Mediation Impasse: Reality or Fallacy? (Part 5)


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Continued from Part 4:           

Here, we will break the process down into five stages, and look at what a good mediator must do, and what a good attorney can do, to forge better outcomes in mediation, and have fewer of those long drives home with a less-than-satisfied client.

Convening. (covered in part 2)

Preparation. (covered in part 3)

Communication. (covered in part 4)

Negotiation.

             Most of the rest of the reasons for impasse occur as a result of the negotiation process.  The primary reason for impasse here is that the mediator played too passive a role in the negotiation process.  Mediators need to act as orchestra conductor here, bringing up the strings and down the percussion and keeping everyone together in the same rhythm as best they can.  Too many mediators cast themselves as observers in the negotiations, demonstrating no skills, expertise or finesse in helping to keep the negotiation moving in the way it needs to in order to reach a settlement.

            The first thing that seasoned mediators know is that the negotiation stage of the mediation begins during the convening stage, as we negotiate together who will attend, when and where the mediation will be held, and what authority will be needed in the room to bring about a complete settlement, and the negotiation continues until agreement is signed.  Experienced mediators understand that every demand by counsel, even as early as the convening stage, is part of their negotiation strategy.

            Another negotiation challenge is the mediator buying into the bluff.  When one party says, “That is our bottom line”, what they often mean is that they have not yet been convinced, or given enough information, to change that final position.  That statement is heard by the seasoned mediator as, “Knowing what I know now, about the case and about the other party(ies), I am not willing to move from this position.”  It might also simply be a negotiation tactic to attempt to scare their opponent.

            What can be learned from this perspective is that a “bottom line” is usually just another strategy in the negotiation process.  This is not to say that people are not being truthful when they announce a bottom line.  Sometimes they are.  This is not to say that mediators should not believe people when they say that a particular number is a bottom line or best and final offer.  The seasoned mediator knows that this means that this is how they are evaluating the case under the present circumstances as they see them.  The key to working through this barrier is to help them see things a different way.

            Knowing that this bottom line objection may occur is what occasionally prompts some experienced mediators to keep a key case fact or mediator observation in their back pocket.  Holding back a useful piece of information in anticipation of such a moment can help everyone.  It is a fact that people don’t change their minds, but given new information, they are free to make a new decision.  This is another way of allowing people to save face and back down from that “final offer” statement by helping them have a legitimate reason to move a little further.

            While everyone in the room may be responsible for knowing, understanding and discussing the facets of the case (facts, law, cases, legal climate, and settlement marketplace), there is only one person in the room who is responsible for the big picture.  That is the mediator.

            The reason that the mediator is in sole charge of this is simple:  psychologists would say that the other participants are in a state of conflict.  When people’s amigdala gets triggered, it literally reroutes brain function from the logical, rational part of the brain into the part that processes emotions.  It puts people into fight or flight mode. 

            When people are embroiled in a conflict, their stress level is high and that can put blinders on them, often without them realizing it, seeing nothing but the conflict.  They can lose their peripheral vision which would otherwise allow them to see how this litigation or conflict fits into their everyday lives, their time, their budget, and their stress level.  In days of old, attorneys were removed enough to give their clients this perspective.  Today, some still are.  But today’s legal marketplace can demand that attorneys become just as embroiled in the case as their clients are.

            What some lawyers gain in intimate knowledge, passion and advocacy effectiveness, they can lose in their ability to remain detached and able to see the big picture.  The mediator is hired to be the one who is not in a state of conflict, and who is charged with remaining clear and mindful of the big picture, and helping the participants remain that way, throughout the negotiation.  Some mediators call it going to the balcony.  I think one needs a larger perspective than that.  A good mediator needs the ability to see the big picture of the case, the negotiation, and the big picture of the parties’ lives and how this case impacts them, their families and their businesses.  Injecting this perspective is one way that a case can be made to look different, and bring more of reality into the negotiation.

            The key to the mediator helping the parties avoid most negotiating impasses is for the mediator to see them coming.  This is the other reason it is critical for the mediator to have a perspective of the negotiation that more resembles that of a helicopter at 5,000 feet.  If the negotiation steps by each party are not going to lead to a point of intersection or agreement, the mediator has to see this by the third or fourth move and help to choreograph the negotiation to foresee the potential for impasse and avoid it well in advance. 

            Mediators can only do this if they understand the science of the math in a negotiation.  Each number telegraphs a message.  Your mediator should be carrying more than just a number from one caucus room to the other.  I call that a naked offer, when it’s not draped in the context, the meaning, or the explanation that is vital to its complete understanding.  Too many mediators leave participants guessing what a number means, and given the conflict they are in, can tend to paint it with the worst of intention and with the most skeptical eye, unless the mediator brings a different message to accompany it.

            Additionally, there is still much more going on in the mediator’s mind – namely calculating whether the parties are on track to get to an agreement.  The mediator must have his or her eye on the finish line at every moment of the process.  That finish line, of course, is an agreement containing all parties’ signatures.  Remember, the deal is not done when there is agreement on a number.  The negotiation must include all of the settlement terms, including payment terms, confidentiality (if applicable), release language, and other terms that are important to the parties, in addition to the standard California Civil Code Section 1542 waiver and Code of Civil Procedure Section 664.6 for enforcement.

            This requires the mediator to be multi-tasking.  Your mediator must be simultaneously at ground level, toe to toe with the parties, being compassionate and a good listener and discussing specifics about the case, while also stepping back metaphorically to question whether the present conversation is going to help everyone get to the finish line, and then rising up higher yet to lift high above the conflict to see the big picture of the negotiation strategies the participants are employing.

            The mediator must be calculating and extrapolating the progress of the negotiation numbers, as well as understanding the impact of the non-economic terms that need to be discussed, when to introduce those terms into the negotiation, and what impact they will have.  The mediator must also be mindful of each parties’ big picture – their real life and the rest of their business outside of this case, and when to bring those perspectives into the conversation.

            Another negotiation impasse that can occur is one I call “Looking Sideways.”  This occurs when participants in a multi-party mediation are paying more attention to what another party is getting, or paying, than whether an offer is in their own best interest.  This frequently occurs when there are multiple parties on one side of the table – either multiple plaintiffs who will divide a settlement in some fashion, or multiple defendants, such as in construction defect and product liability claims where there can be dozens of defendants contributing to a global settlement.  In this instance, one co-defendant will stake out a position that is completely dependent on another co-defendant’s offer.  For example, one subcontractor will say, “I will pay whatever so-and-so pays, but not a penny more.”  Or one co-plaintiff will object to a global settlement offer from the defendant(s) because they don’t like the distribution of the settlement fund.  This isn’t a cause for impasse either, it’s just the next challenge that needs addressing.  It means that someone has a need that has to be met, and considered before an agreement can work for everyone.

            Looking sideways can also describe when a defendant becomes more concerned with the windfall to a plaintiff, rather than whether the settlement makes economic sense for them.  This can sometimes be remedied by including non-economic terms or by paying part of a settlement to a third party, such as a non-profit organization.

            When parties are looking sideways, instead of at their own best interest, the mediator has to use an “above the fray” perspective to help that party keep their eye on the ball and decide whether their individual share results in a fair settlement to them, without regard for what others are doing.  For example, if a case is settling for a global settlement of $300,000, and one plaintiff feels like they deserve more than an equal division of those funds, the mediator’s question to them, keeping the big picture in mind, is whether they are satisfied with their settlement amount when compared to their expectations coming into the mediation, or perhaps whether they’re satisfied with their settlement amount as a percentage of the whole, rather than compared to each other co-plaintiff.  One last approach is to ask them what they’re going to do with the settlement money when the case is done, turning their focus to spending the actual, tangible money, rather than quibbling over abstract numbers as though it was Monopoly game money.  These approaches may make their individual settlement amounts seem fair and relevant to them, allowing them to explain it to others (spouses, parents, adult children, etc.), if that is necessary.

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Lee Jay Berman
Lee Jay Berman began as a full-time mediator over 22 years ago, and has successfully mediated over 2,100 matters. As a respected trainer, he founded the American Institute of Mediation, leaving his position as Director of Pepperdine Law School’s Mediating the Litigated Case program after seven years. He is also an ADR thought leader and avid blogger at Eye on Conflict: www.eyeonconflict.com