Recently, someone asked me, “When should I mediate my dispute? Should I wait until the lawsuit is filed? Should I wait until depositions are taken or motions for summary judgment are filed and/or heard? When IS a good time to mediate?”
To me, it is always a good time to mediate, no matter where a dispute may be in the timeline of litigation. But, I also recognize that different parties will decide to mediate a case at different times depending on the nature of the litigation, the parties involved, the issues and what is at stake. For example, some parties will seek to mediate very early on- within weeks after the answer is filed- or even pre-litigation –before the lawsuit is filed- in an effort to save costs. This is especially the case when a contract provides for the prevailing party to recover attorney fees only if pre-lawsuit mediation occurs (e.g., California Real Estate Purchase Contracts) or where the attorneys’ fees are recoverable by statute (e.g., The Song-Beverly Consumer Warranty Act, California Civil Code Section 1790 et. seq.). Generally, the earlier the mediation is conducted, the more the parties can save in attorneys’ fees and costs. Where there is a fee shifting statute involved such as Song-Beverly, defendants want to mediate early to avoid having to pay large sums in plaintiff’s attorneys’ fees.
In other situations, the parties believe that they need to conduct a certain amount of discovery for the mediation to be meaningful. I have conducted mediations early in the life of a case, only to have the parties determine that more discovery is needed for the parties to reach a meaningful compromise. Thus, a second session may be required. The first session, though not ending with a settlement, is still productive as it highlights the issues to be explored so that the parties can attempt to resolve their disagreement and settle under a “win-win” scenario.
Sometimes, the parties have advised me that a particular matter revolves around legal issues. Thus, the plaintiff or defendant believes that the filing and hearing of certain motions are a necessary pre-requisite to attending mediation. A defendant may want to have a motion for summary judgment heard BEFORE mediating to gain leverage. But, at the same time, I have conducted mediations in which both parties believed that the best time to mediate is when a motion for summary judgment has been filed and briefed but not yet heard; each party feels it has leverage in awaiting the outcome; the uncertainty provides an incentive to settle.
Besides the litigation time table, there are also emotional factors to consider. At the outset of the case, emotions can run high. As the case wears on, so does the psyche; especially if a party is tired of seeing monthly attorneys’ fees bills in the thousands of dollars and/or having to spend unproductive time on the case rather than being able to work and earn a living. The case goes from being one based on “principle” to one that is getting too expensive and time consuming and the party wants “out!”—she does not care what it takes to reach this goal.
At the same time, where the case is an emotional one, those feelings may harden as the case progresses. The attorneys may wage the equivalent of a “take no prisoners” or “scorched earth” war so that as the litigation progresses, the parties get more hardened in their respective positions. Thus, an early mediation would be better—well before the parties become too invested and entrenched in their positions and do not want to “lose face” by compromising.
Thus, while to me it is always a good time to mediate, to a party in a dispute, timing is everything!
by Phyllis G. Pollack
Also available at http://www.pgpmediation.com/2012/11/30/when-should-i-mediate/