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How to prepare for mediation

by Chris Crowe on 23 Jan 2014

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A change of mindset is a daunting assignment, especially when umbrage has been taken and hostile emotions exist. Think of the Cold War and the entrenched enmity between the United States and the USSR. Relations took nearly 50 years to warm up and even today they remain tepid at best.

At the height of the Cold War, former US President Richard Nixon declared: ''The cold war isn't thawing; it is burning with a deadly heat. Communism isn't sleeping; it is, as always, plotting, scheming, working, fighting.'' Even with the threat of a nuclear war, Americans could see no way of calming the ingrained hostility.

 The same kind of sentiment is often brought to bear in a typical commercial dispute. There is a natural tendency to fight, to seek justice by defeating the opponent in court. It takes time and often a lot of money.

In mediation, disputants are advised to ditch the natural instinct to clash and attempt to calmly analyse the reasons behind the quarrel. It’s not an easy step to take for warring parties, let alone many lawyers who are naturally programmed to battle.

At the heart of mediation is an emphasis on the intentions and needs of the disputants, unlike in litigation where the focus naturally moves to legal rights and obligations. Jane Player, a London partner in King & Spalding’s disputes group remarks: “People often prepare for mediation as if it were litigation and they exchange submissions which are little more than pleadings. In reality, it is better to ask them to submit a short document on their view of the commercial aspects of the deal and what they are most upset about, and what they are keen to resolve. It is not a formal legal document and this often takes a lawyer out of their comfort zone but, if drafted well, can stimulate a creative resolution conversation.”

She adds: “Don’t come along to a mediation with a lawyer who bashes the table and shouts about historical wrongs done to his client. Instead, bring a lawyer who knows the law is just one factor of this dispute and a Principal in the business who can explain the commercial issues at stake and what might provide an acceptable solution.”

A successful mediation requires detailed preparation. Unlike in court proceedings where the barrister or counsel might buy time through skilled advocacy and sheer intellect, the same cannot be said for mediation proceedings.

Alexander Oddy, a partner in the disputes division at Herbert Smith Freehills says that preparation is imperative because the proceedings are designed to be short and to reach a quick resolution. ‘Almost all of the important work takes place in the days, weeks or months before the mediation. What you say or do on the day can be quite constrained by comparison,’ he explains.

Oddy indicates that clients need to be carefully briefed on the dynamics of a mediation and that there are only a ‘finite number of moves’ in the negotiation. He believes that picking an appropriate starting position can be crucial in achieving a satisfactory result.Derisory opening offers often lead to the parties running out of steam when there is too much of a gap between them,’ he explains.

The mediation process equally rewards disputants who are willing to put their cards on the table. Holding something back for a potential trial is contrary to the spirit of mediation. Furthermore, the Civil Procedure Rules in the UK actually encourage early disclosure.

Though mediation may not have the traditional cut and thrust of the courtroom, it should not be viewed as an easy ride for the disputants. In a court trial, they simply watch the proceedings unfold. In a mediation they are placed in the front line. ‘It is potentially a much more confrontational process than being in court,’ Oddy comments. ‘That just involves the clients spectating at the back of the room. In a mediation, clients will be looking each other in the eye and will be confronting difficult issues. One needs to prepare them for a confrontation on difficult issues and any underlying emotions that could form part of the process.’

Disputants must also examine the potential cost of a dispute that runs to trial and whether giving some ground in a mediation would have some commercial and financial benefit. Again, preparation on this point is key as Player remarks: “You might resolve a dispute two years earlier than you might have otherwise and you might retain a relationship with the company that you are in a dispute with. There is a management cost and a business cost that comes with a full-blown dispute and this is often not calculated before the mediation.”

It’s an approach that the Americans might have taken during the Cold War. The development of more cordial relations with the USSR might have lessened the huge cost of building and maintaining its immense nuclear arsenal.

This post was written by Chris Crowe who is a freelance journalist. He can be contacted at chris@crowemedia.co.uk

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Topics: Mediation

Chris Crowe

Written by Chris Crowe