Saturday, July 17, 2010

Does ADR threaten litigants' rights?

At a Southern California Mediation Association meeting I attended today, we heard a version of a talk that Presiding LA Superior Court Judge McCoy has been giving around the county about the effects state budget cutbacks are having on our local courts.  These cuts could increase the time from filing to trial of civil cases from about 18 months currently to two or more times that long. One might think that court delays would increase the demand for alternative dispute resolution, but while that might hold true for arbitration, it does not seem to increase the demand for mediation.  If we are going through a transitional period where the lag time for civil cases is increasing, that means parties have more time to complete discovery, and a longer wait before facing the pressure of a trial date.  That may mean less pressure to mediate the resolution of those cases.  Thus, as delays continue to increase, that may actually lead to fewer opportunities for negotiated settlements.

The theme of today's meeting was whether mediation threatens the rights--particularly the right to jury trial--litigants have in court.  Not surprisingly, none of the speakers (who were all proponents of mediation) believed that mediation presents a significant threat to litigants' rights.  (The argument that ADR threatens our rights is also discussed in another post I did last month.)   Judge McCoy's presentation suggested that far from a threat, there is actually a symbiotic relationship between ADR and the courts.  When the courts work to guarantee the right to jury trial for all who demand it, and especially when the courts are able to set meaningful trial dates, more opportunities are presented for alternative forms of dispute resolution.  Mediators should therefore not be hostile or antagonistic toward the courts; they should instead be fighting to protect the right to jury trial. Preservation of that right actually fosters a climate that encourages parties to settle.

Another presenter, well-known mediator Lee Jay Berman, made the related point that mediators should generally shy away from criticizing the court system as an argument to induce parties to settle.  We don't need to cast doubt on how well the justice system produces justice.   In fact, the court system may do a very good job of that, but its results will vary based on a whole range of factors: which judge is hearing the case, what the judge is influenced by during the trial, the composition of the jury, the way the case plays out on a particular occasion, etc.  Mediation can produce a better result than litigation, not because the court system gets it wrong, but because a negotiated settlement eliminates the costs and risks of litigation.  Mediators should make clear that disputants always retain their right to proceed with their case all the way to trial; that makes it more clear that any settlement the parties may enter into is done by choice, not out of fear or loathing of the court system.

(Lee Jay also mentioned a really interesting program he is hosting this coming Friday, where he is bringing together two adversarial Arizona legislators, not to debate the recent controversial Arizona immigration statute, but to engage in a mediated discussion about it.  People say they are disgusted with the partisan, confrontational, hysterical nature of many of our political debates lately.  I hope a lot of people turn out to hear a program that offers a much more positive alternative.)

(B. Hampton photo from Flickr)

Friday, July 16, 2010

Phoning it in

Whenever an attorney involved in a mediation asks me if their client can be available by telephone, I am usually reluctant to agree.  If the case is important enough to require my personal attention, should it not be important enough to the parties to compel their presence?  After all, it's their case.  It also seems intuitively obvious--though I'm sure there are studies to back this up--that mediation is more likely to be successful if people take it seriously enough to attend in person, and if they have the opportunity to communicate face-to-face at least with the mediator and preferably with the other side.  Or maybe I just feel that phone mediation, like phone sex, can never be as satisfying as the real thing.

My worst experience with a telephone conference mediation came in a case where all the parties and attorneys participated by conference call.   I went along with it because the parties and attorneys were operating from scattered distances, and one of the participants was not feeling well enough to travel.  After an initial conference call with the attorneys, I tried to convene a caucus with one party and his attorney.  But as soon as I described how the other side viewed the case, the party hung up the phone and refused to participate any further!  I have had people try to walk out of mediations before, but at least in a face to face meeting, I can  run after them and haul them back to the conference room.  But having someone hang up made me feel a bit more powerless.  (By the way, I'm sure it was mostly my fault that my way of expressing the situation caused the party to hang up.  But that just illustrates the problem in telephone communications.  It is a lot harder to judge the effect your words are having on the person you are talking to if you cannot see the expression on their face.)

In other situations, however, the telephone format has proven more successful.  In cases covered by insurance, we can sometimes dispense with the claim rep's presence, as long as the plaintiff's side agrees and the insurance carrier can gain a full appreciation of the case without listening to the plaintiff tell their story in person.   Another advantage of mediation by telephone is that it can sometimes save the parties time waiting for the other caucus to end.  I had a mediation this week which would have required at least some of the parties to appear by telephone only.  For various reasons, we decided to excuse everyone's physical presence, and began conducting the mediation through a series of telephone calls.  This format may have saved everyone time, and also allows the mediation to continue over a series of days, giving the parties some needed time to think about the other side's latest offer.

In general, I and I think most mediators still prefer that parties treat a mediation as an important event, that they prepare for, attend in person, and to which they devote their full attention.  That seems to be the best formula for success.  On the other hand, flexibility must also be a watchword of mediation, and if we make good use of technology like audio or video conference calls and email, we can still accomplish a lot.

Monday, July 12, 2010

Second Guessing

Attacking proposed arms control agreements is a time-honored political game.  Virtually every major arms control treaty between the US and the Soviet Union was subjected to fierce criticism from hard line Senators.  Either the deals were too generous to the other side, or they did not provide adequate verification, or they limited US freedom to develop important weapons systems.  This feature of Cold War politics has now been revived by Mitt Romney, past and presumptively future Republican Presidential candidate.  No doubt hoping to burnish his foreign policy credentials, Romney has come out strongly against the proposed START treaty with Russia, in an article in the Washington Post.  I'm not going to get into a detailed point-by-point discussion of Romney's attacks on the treaty.   (For that, readers can take a look at this piece in Slate or this one in the LA Times.)  The issue that is relevant to this blog is whether critics like Romney have fully considered the alternative to a negotiated agreement.

It is easy to second guess.   Whenever a diplomatic team brings home the fruit of their labors, their superiors can always complain that they did not get as good a deal as our side might have wished for.  Outsiders such as Mitt Romney can always score political points by claiming that the US was out-negotiated, and that the proposed deal is too favorable to the Russians.  Such critics never seem to have to demonstrate, however, how they could have obtained a better deal.  I see nothing in Romney's piece that suggests that the US arms control team was incompetent, or that they did not have in mind all of the interests he claims we should be trying to protect.  Therefore, I would be inclined to start from the assumption that they negotiated the best deal they could get, unless the contrary can be proven.   

Given that assumption, the only relevant test for deciding whether or not to ratify this treaty should be whether it is better than no treaty at all.  This is where critics such as Romney fall far short.  They never seem to take the trouble to compare what each side is allowed or restricted from doing under the proposed treaty with what they are allowed or restricted from doing under no treaty.  So for example, if a treaty critic complains that the treaty does not sufficiently limit the number of warheads that Russia is allowed to field, perhaps they ought to be required to explain that if there is no treaty, the Russians might be subjected to no limits at all.   

Mediators are generally familiar with the concept of BATNA (Best Alternative To a Negotiated Agreeement) from Fisher and Ury's book Getting to Yes.  In arms control negotiations, however, the alternative to a negotiated agreement may be war, or at least an expensive arms race.  In the context of litigated disputes, rejecting an agreement is likely to lead to depositions and motions and trials and appeals.  It is difficult to view these alternatives as "best."

For many disputes, the parties need not be concerned so much about the best alternative to a negotiated agreement, as they should consider the range of possible alternatives over which they do not have complete control.  We could call this the Uncertainty of having No Agreement or UNA.  (Others have suggesting dividing the alternatives into categories like BATNA, WATNA and MLATNA, for best, worst and most likely alternatives.)  In evaluating the advisability of accepting any negotiated agreement, parties have to think about all of the possible scenarios that could develop if the proposed agreement is scuttled.  If they are considering choosing UNA, they might want to assign a range of probabilities to all of the alternative scenarios that choice entails, ranging from victory in whatever contest the parties are engaged in, to the possibility of obtaining a more favorable settlement, to stalemate, and to defeat.  Only when the parties have fully considered all of the potential alternatives to a proposed agreement are they in a position to judge whether to reject the deal on the table.

(Still from the classic film Dr. Strangelove, where the president tells the Air Force General and the Soviet Ambassador that there is no fighting allowed in the War Room.)

Thursday, July 8, 2010

Secrecy in Negotiations

Many people are just not comfortable with face-to-face negotiations.  Even when parties to a mediation are willing to meet for a joint session to discuss the circumstances of the conflict, they generally prefer to break into separate rooms when it comes time to negotiate a settlement.   Sometimes I wonder why people don't behave in the opposite way.  You might think they would be reluctant to reveal their trial evidence, or talk about personal issues in front of the opposing party and counsel.  Instead they are more likely to wish to get these aspects of the dispute out in the open, while preferring secrecy when they are ready to make a deal.  Perhaps that is because people doubt their skills as negotiators, and are afraid they will be out-negotiated, as in the amusing example below.  Or perhaps they just need time to discuss their strategy privately with the mediator, who might be able to provide insight as to the other side's receptivity to their proposals.  

For the most part, however, I think parties to a mediation prefer not to communicate offers and counter-offers face-to-face because they do not want to expose themselves directly to the other side.  Making an offer can be seen as an act of bravado (if it is an aggressive offer), or it could taken as a display of weakness or vulnerability (if it is a conciliatory offer).   Like asking someone for a date, making any kind of offer invites rejection, and people hate rejection.  In addition, making an offer reveals the offeror's thought processes to the other side, in the same way that a poker player placing a bet on the table  tells the other side something about the strength of his hand.  Even if the poker player is hiding behind his best poker face and his darkest sunglasses, the amount he puts on the table is still a revealing gesture.

Perhaps this desire not to show one's hand explains the advent of online negotiating tools such as Cybersettle, which allows offers and counter-offers to be communicated online, without either side knowing the amount of those offers.  Cybersettle only informs the parties of their numbers if they are within a set range of each other, thus allowing parties to close a deal only when they both know that a deal is within reach.  It seems like a useful tool for parties who have already decided they want to settle, and just want to make sure that they do not offer more or less than they need to to close.  The most important part of mediation, on the other hand, is the part that prepares the parties to enter the deal-making phase.  Only after the parties have identified their interests and the business or personal issues that may be driving the dispute, and after they have fully considered the costs and risks of resolving the dispute in the courts, are parties ready to consider resolving a dispute by negotiated agreement.  At that point, if the parties have reached the state of enlightenment that we all hope for, it should be relatively easy to make a deal, whether face-to-face or from separate rooms.  But often, there is still a lot of negotiating work to do, and I don't begrudge the parties a little separation from the opposing party if that is what they prefer.