How To Get The Most Out Of The Mediation Process

In summary

Mediation remains one of the most effective tools for resolving complex disputes—but achieving successful outcomes requires far more than simply attending on the day.

Drawing on decades of combined experience, the panel of four experienced mediators shared practical insights into preparing for mediation, managing negotiations and maximising the prospects of resolution. The discussion explored what experienced mediators, advocates and insurers consistently see as the factors that contribute to successful outcomes.

Key takeaways

• Decision-makers must attend: Mediation should include key decision-makers and advisers to maintain negotiation momentum and avoid delays caused by lack of authority.
• Insurer involvement is important: Having insurers present helps all parties understand case strengths and weaknesses and humanizes the insurer to opposing parties.
• Preparation and strategy are crucial: Effective mediations require clear client instructions, defined negotiation strategies, and well-crafted position papers that communicate each party’s stance.
• Face-to-face mediation preferred: In-person sessions foster better negotiation dynamics, allowing parties to read body language and manage tensions more effectively than online mediations.
• Agree on settlement terms beforehand: Parties should prepare and agree on settlement terms in advance, focusing mediation on the settlement amount to enhance efficiency and likelihood of agreement. Disclosure of insurer backing or financial capacity is also advised.

In depth

Mediation is a human experience. It involves the parties coming together to discuss the issues in dispute whilst guided and assisted by an experienced mediator. Many legal practitioners glance over the purpose of mediation, not merely a required court ordered process, but an opportunity to negotiate, to explore the issues in dispute, reflect on prospects of success, and consider the possibility of resolution.

Moderated by Mark Attard, the panel discussion at the Financial Lines Symposium which involved four experienced mediators highlighted how to get the most out of the mediation process.

Although it may seem obvious, the mediation should be attended by the key decision makers and advisers of each party. The panel have many times seen a mediation grind to a halt because a junior lawyer with no executive decision-making ability attended a mediation and has had to constantly seek instructions on the next steps in negotiations. A mediation is about rhythm and process, and when a party is unprepared, it acts like a circuit breaker in the mediation process.

The presence of any insurer is also advisable, for the benefit of everyone; the insurer will get a better understanding of the issues in dispute and t the strengths and weaknesses in their insurerd’s position and they will hear and be able to respond to the mediator’s comments. It is also important for the opposing party to see the insurer as a human rather than some abstract entity.

The panel weighed in on position papers, which sometimes tend not to be useful, however a good position paper is one were the party sets out what they want and makes the opposition understand their stance.

The most important thing to prepare for a mediation, is a strategy. This means a strategy for negotiations and an offer strategy. The most successful negotiations occur when the parties attend with a clear strategy, have clear instructions from their client/s and are aware of their offer strategy. This limits surprises and allows parties greater flexibility to pivot or reconsider their position. Strategies need to be flexible as the mediation is a dynamic environment.

Mediations rarely satisfy everyone, however, most participant prefer to hate the outcome, rather than continuing the litigation.

The panel discussed how having mediations fact-to-face is to be encouraged. It also parties an insight into their opposition from body language and tone. Tensions are also harder to manage with online mediations. Parties are more willing to engage in the process if they are removed from the distractions of their home or office environments.

Mediations should begin with a joint session. This allows parties to understand each other’s position and consider the history of the case. Greater understanding better informs a party’s comes reasoning and thinking about the dispute and its possible resolution, and that is always helpful in facilitating the conversation and the subsequent negotiations. The more time spent in joint session and in exploring the issues that divide the parties, the greater chance that subsequent negotiations will be successful.

It is recommended that in a party’s opening addresses, that concessions be made to the opposing side. This is to be preferred to an aggressive, “winner-take-all” approach. Displaying vulnerability encourages engagement and sees the other side listening and being more receptive to your message. While runs contrary to the adversarial nature of disputes, it creates an environment where negotiations are conducted with goodwill and discourages entrenched position-based bargaining.

In a similar vein, the panel recommended that the parties share their willingness and intention to make an offer to settle the dispute. Controversially, they also recommended that the involvement of an insurer should be disclosed. Such openness will encourage engagement.

In the name of efficiency and greater prospects of success, the panel advised that the parties should prepare and agree on a set term of settlement so that the mediation is limited to reaching an agreement on a settlement sum. A lengthy negotiation of terms after a lengthy negotiation on the settlement amount should be avoided. Bad decisions usually follow late night discussions where the parties are fatigued.

Ultimately, to prepare for a mediation is to have clear instructions, strategy and be flexible and understanding of the issues in dispute.