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Bench & Bar of Minnesota is the official publication of the Minnesota State Bar Association.

Eyes Wide Open: Optimizing Outcomes through Mediation

Attorneys, courts, and clients alike can benefit when disputes are resolved quickly, amicably, and based on full understanding of the potential risks and costs of litigation.  Mediation, historically focused on preserving parties’ relationships, is evolving to include an evaluative component so participants more clearly understand the costs and risks of going to court.

Whether we agree or disagree with Rabin’s theory as it relates to international diplomacy, as attorneys we understand it in terms of weighing every case and whether we take a chance in litigating or settling. If we can achieve more for our clients in litigation, why risk settling for less? We weigh the pros and cons as well as the expense and time of litigating each case against the possible outcomes. Clients presumably make a similar calculation: those who believe they will “win” in court are usually willing to assume the risk and may resist mediation. Such clients are more likely to participate meaningfully if they appreciate the costs and risks they assume by going to court, including financial expenses, loss of control, an eruption of emotion, and an extended time commitment.

Overcrowded judicial calendars are prompting courts and attorneys alike to consider alternatives to litigation, and mediation has become increasingly popular. In Minnesota, all parties to civil matters are expected to attempt some form of settlement process before appearing at a hearing. Mediation tends to be a popular choice of ADR because parties maintain control in creating their own settlement agreement. Nevertheless, attorneys who have been trained to promote their clients’ causes by engaging in an adversarial process may be discomfited by the idea of a party-controlled settlement agreement.

Attorneys who have had a bad experience with mediation, or who have been hesitant to give mediation a real chance, will be pleasantly surprised to learn that mediation is changing and the change may mean a more effective resolution process. Attorneys who participate in mediation are demanding a more focused, efficient approach that often relies on mediators sharing their experience and expertise to help parties realize the risks inherent in each specific case if it goes to trial. Law Review articles and legal blogs are filled with news of this shift in mediation.1 Mediation is changing to meet the needs of parties who are represented by attorneys, and attorneys are starting to appreciate the value mediation provides for their clients.

Roots of Mediation

Mediation historically has been a dispute resolution process that allows parties to maintain their relationships without entering the adversarial process of litigation. For employers and employees, parents, and companies who will continue to do business together, mediation offers parties a chance to find common ground in resolving their disputes while protecting the fragile relationship they must maintain in the future. Parties to a dispute are encouraged to work together early in the process to come to an agreement rather than to defend adversarial positions as they would in litigation. In family law, some attorneys will schedule mediation before filing with the court. If they bring parties together early, they can file a joint petition and stipulated agreement rather than file as two opposing parties.

The United Nations Guidance for Effective Mediation, printed in September, 2012, states:

Mediation is a process whereby a third party assists two or more parties, with their consent, to prevent, manage or resolve a conflict by helping them to develop mutually acceptable agreements. The premise of mediation is that in the right environment, conflict parties can improve their relationships and move towards cooperation. Mediation outcomes can be limited in scope, dealing with a specific issue in order to contain or manage a conflict, or can tackle a broad range of issues in a comprehensive peace agreement.2

Mediation at its core is an interest-based process of dispute resolution. Lon Fuller wrote mediation allows parties to reorient “toward each other not by imposing rules on them, but by helping them to achieve a new and shared perception of their relationship: a perception that will redirect their attitudes and dispositions toward one another.”3 The mediator’s role is to provide each party’s perspective to the opposing party and bring a new awareness to each side with the goal of achieving an agreement. The traditional focus of mediation is not toward court rules and statutes; rather it is an open forum for parties to be creative in their dispute resolution.

Attorneys who are suspicious of mediation fear time and money can be wasted in mediation if the process of dispute resolution is not focused and if the mediated settlement is not better than their worst-case scenario in litigation.  Evaluative mediation may be the answer for eliminating that fear.

Facilitative v. Evaluative Mediation

From a practical standpoint, what is the difference between facilitative mediation and evaluative mediation? Facilitative mediation is a process in which participants are given an opportunity to be heard, to be understood, and to find resolution to their disputes.  The mediator is expected to guide the parties through an exploration of interests and creative options to an agreement which the parties ultimately create on their own.

The mediator is not expected to offer an opinion on the merits of any particular proposal, the legal legitimacy of the proposed agreement, or the fairness of the agreement. In fact, Minn. Stat. §572.35 prescribes that in order for a mediated agreement to be binding, parties must acknowledge that “the mediator has no duty to protect their interests or provide them with information about their legal rights.”

While a mediator has no duty to provide parties information about their legal rights, in evaluative mediation, the mediator may provide her opinion of the best and worst case possibilities for the parties.  This can help them appreciate the risks and rewards of creating their own settlement agreement rather than leaving it in the hands of a judge or jury. The mediator can offer his opinion on the strengths and weaknesses of each party’s case from a neutral perspective rather than the perspective of an advocate for either side.

Unlike an arbitrator who has the authority to make a binding decision when the parties disagree, a mediator is not authorized to make a decision for the parties, even in evaluative mediation. The mediator can suggest creative solutions where parties might otherwise reach an impasse and attorneys can work collaboratively with the mediator to lead parties to an agreement that maintains their interests.

Practical Perspectives

Michael Quinlivan, of Pearson Quinlivan, Ltd. in Maplewood, who practices in the areas of commercial, tort, and insurance litigation, reports that in his experience, mediators can help keep clients’ expectations realistic.  Mediators with experience in the related area of law are able to draw upon that experience, together with understanding of the parties’ positions and underlying interests, to give parties a realistic, yet impartial perspective on how their interests may or may not be served as they move through discovery, motions, and trial.

Quinlivan says the best mediator is one who draws on her own experience to effectively communicate an assessment in a factual, credible manner that engenders the trust of the parties. In his view, an effective mediator can offer “honest reflection and evaluation on the merits of the party’s position and what is realistically achievable at mediation vs. what is realistically achievable at trial.” Quinlivan notes that even if mediation does not result in an agreement, it is not necessarily a waste of time because a good mediator helps both parties see the realities of their case and the parties leave mediation with a realistic view of the strengths and weaknesses for each party.

Mediation can be an effective resolution even in cases traditionally brought through litigation. Insurance companies in particular would rather pay their attorneys to achieve a faster resolution through mediation than pay the costs of litigation and they tend to be “repeat” participants in mediation. Their focus is minimizing risk and expense. They balance the merits of each case against the costs of settlement, including litigation costs. By contrast, victims in a personal injury lawsuit, who are typically one-time participants in the process, may be more concerned about being heard and achieving justice than obtaining a quick result that balances risk and financial reward.

In the area of employment law, the Equal Employment Opportunity Commission (EEOC) strongly encourages parties to employment-related lawsuits to attempt mediation to resolve their disputes. The EEOC surveyed participants and found 96 percent of respondents and 91 percent of charging parties indicated they would use the mediation process again if the opportunity arose, even where the results of the mediation were different than they had anticipated.4

One employment law practitioner, Tom Jacobson, of Swenson Lervick Syverson Trosvig Jacobson Schultz, PA in Alexandria, says mediators he’s worked with typically do not provide their opinion on the merits of a case during mediation. They will provide an opinion on the process, but only if invited to share their opinion. He has seen growth in the acceptance of mediation as a practical means of settling employment-related disputes.

Judicial Perspectives

The Hon. Janet Cain in the 1st Judicial District, who has seen mediation work well especially in family law matters, says one of the biggest advantages of mediation is the opportunity for clients to get a realistic, objective perspective on what may or may not happen in court. Clients come to attorneys with their own perceptions of what the court will give them in a lawsuit. Judge Cain points out that some attorneys are better than others at breaking the hard news to their clients that they may not get what they want from the court, and of course some clients are better at listening to their attorneys than others.

A mediator can offer a neutral perspective regarding the strengths and weaknesses of each party’s position and assist in creating realistic expectations.  The early neutral evaluation process (ENE) is now available in many counties across Minnesota.  In an ENE, the evaluator provides family law parties a realistic perspective on their case before affidavits are drafted and before temporary motions are filed. Judge Cain points out that the ENE process can save parties time and money and spare them the opportunity to get nasty in taking their respective stands. The ENE is entirely voluntary but judges typically take the time during the Initial Case Management Conference (ICMC) to strongly encourage parties to participate in the ENE process because they know the benefits to parties in family law matters are great.

The Early Neutral Evaluation is a hybrid between arbitration and mediation where the third-party neutral offers a recommendation to the parties but the decision to create an agreement is still left to the parties. For example, a stay-at-home mother might expect to get permanent spousal maintenance based on what she has heard from her friends who have been divorced. If the mother is educated and still has many years to be in the work force, she is not likely to get permanent spousal maintenance.  Her attorney may not be able to help her understand her realistic chances of getting spousal maintenance, or may not know how to tell her. Spousal maintenance is a fact-specific issue in which judicial discretion can make results in each case different. No one can guarantee a client what a judge is going to do, but helping the mother understand her realistic chances may help her avoid the costs of litigation and create a fair settlement that will help meet her financial needs.  A mediator experienced with the court can help clients appreciate the risks in litigation and that insight can inform the parties’ motivation for settlement.

Implications for Practice

When a client walks into your office and you file a lawsuit on her behalf, do you discuss mediation with that client? At what point do you consider whether mediation will be a good use of your client’s time and resources? Advocates of mediation would say every case can be successfully mediated, but attorneys who are passionate about litigation would likely disagree.

Assessing the real and potential risks involved in proceeding to litigation should always be at the forefront of the decision to attempt mediation. Attorneys tend to prefer a more evaluative mediation. Their preference is supported by the empirical findings that cases are more likely to settle when mediators offer their views regarding the merits of a case.5  Attorneys are trained to defend their client’s position in an adversarial process. Adjusting that training to an arena where parties are encouraged to work together through their impasse takes practice and time.

Leonard Riskin and Nancy Welsh observe that attorneys and insurance claims adjusters whose expectations are focused on the risk/merits assessment of each case may lose sight of the nonlitigation benefits of mediation.6 At its best, mediation can address and resolve personal, psychological, relational, and communication issues in addition to achieving the bottom line of a monetary settlement. If the goal of mediation shifts to accommodating the needs of those who demand an efficient settlement process rather than addressing the deeper issues at the heart of the dispute, the benefits of mediation may be lost. A middle ground, where mediation can offer effective settlement of disputes while preserving the integrity of the process, may be found in a hybrid process where a mediator offers unbiased guidance based on her experience in the courts while allowing parties to voluntarily choose their own resolution agreement.

Choosing a Mediator

Abraham Lincoln said, “Give me six hours to chop down a tree and I will spend the first four sharpening the axe.” When you or your client decide to try mediation, choosing the right mediator can make the all the difference. Whether you come to an agreement or not, a good mediator should provide a neutral perspective on the strengths and weaknesses of the case. As an attorney representing a party in mediation, you have the opportunity to suggest or promote mediators who you believe will be effective in resolving your particular dispute.

Mediators in Minnesota are not required to be attorneys or to have any experience in law. In fact, there are no state requirements for a person to work as a mediator. In order to be on the Minnesota Supreme Court list of Rule 114 Neutrals one must complete a certified neutral skills training class, but there is no requirement that he be an attorney or have attended law school. Mediators in Minnesota are therapists, business entrepreneurs, teachers, attorneys, and a wide variety of other occupations. Each mediator’s experience and background may provide unique advantages and disadvantages, depending on the case. Some pro se parties participate in mediation because they prefer not to work with attorneys (shocking?) and they seek out nonattorney mediators to help them resolve their disputes.

Research shows that most attorneys prefer an evaluative process of mediation with mediators who understand the dispute from a legal perspective.  Attorneys are trained to be advocates for their clients in an adversarial process and tend to more comfortable in a process where resolution is focused on balancing strengths and weaknesses of the case and balancing the risks of going to court versus reaching a settlement.7

Attorneys in all areas of law can promote effective use of mediation. Finding a mediator who is appropriate for each client and case is essential. Some clients may have more success in a facilitative process that allows them time to process the intangible issues they must address to reach an agreement, while other clients may need a neutral with a more directed approach to help them weigh the risks and compare potential results likely if they pursue litigation.

Challenges Ahead

Attorneys who are hesitant to buy into mediation should consider the possibilities of an evaluative mediation process. The challenge for mediators and the attorneys who represent clients in mediation is to maintain the integrity of the mediation process while providing cost-effective and efficient dispute resolution. The overriding concern as mediation becomes more evaluative is that at some point it may be nearly indistinguishable from a traditional adjudicative process: that the positioning and legal posturing that occur in litigation may seep into the mediation process, thereby effectively negating its alternative character.

The ultimate goal of mediation is an agreement created by the parties without the adversarial posturing of litigation. While mediation is not litigious, the probability of success increases dramatically when the mediator, the parties, and the attorneys engage in honest and effective evaluation of the risks, benefits, and costs of litigation versus settlement. This evaluation may take place privately in mediation caucuses or together in a cooperative discussion. As more courts require parties take advantage of the alternative dispute resolution process, more clients may be looking for attorneys who are effective in promoting mediated agreements. The more efficiently you can settle disputes, the more clients you have time to represent. As Abraham Lincoln put it, “Discourage litigation. Persuade your neighbors to compromise whenever you can. As a peacemaker the lawyer has superior opportunity of being a good man. There will still be business enough.”

Christine M. Callahan is a family law attorney, mediator, and parenting consultant, practicing as Callahan Law, LLC, in Chaska, Minnesota.  A graduate of the University of St. Thomas School of Law, she is qualified as a Rule 114 neutral by the Minnesota Supreme Court. She can be reached via her website, www.christinecallahanlaw.com.

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