Saving Time & Money Through Mediation
by Guy O. Kornblum, Esq.
"The odds of a plaintiff's lawyer winning in civil court are two to one against. Think about that for a second. Your odds of surviving a game of Russian roulette are better than winning a case at trial-twelve times better. So why does anyone do it? They don't. They settle. Out of 780,000 trials, only 12,000 or 15.4 percent ever reach a verdict. The whole idea of lawsuits is to settle, to compel the other side to settle. And you do that by spending more money than you should, which forces them to spend more money than they should, and whoever comes to their senses first loses. Trials are a corruption of the entire process and only fools who have something to prove end up ensnared in them. Now when I say prove, I don't mean about the case, I mean about themselves."
-Lawyer Jan Schlictman (played by John Travolta in the movie A Civil Action)
Anyone who has been involved in a lawsuit to resolve a dispute knows how laborious and often mysterious it can be. Thankfully, the resolution process is changing. The public is demanding a more user-friendly system that encourages litigants to enter into early discussions about resolution to avoid the time, expense, and emotional drain of protracted litigation.
A settlement is the best economic day for a client, considering the value of money in hand-that is, the client has the use of funds now rather than the hope of some recovery later-and the cost of taking a case into the pre-trial and trial states (and possibly through appeal). The costs of litigation are often surprising to clients, particularly if expert testimony from physicians or technical experts are needed. The fees for these experts are quite high, usually several hundred dollars per hour. Considering the amount of time that experts need to prepare, testify at deposition, and then appear in court, several thousands of dollars can be incurred quickly by just this aspect of the case.
The public has become intolerant of the notion of the trial lawyer as a "warrior" or "combatant," but instead are looking to litigation lawyers as problem solvers who can penetrate the process and assist in resolving a dispute, not perpetuating it.
In my view, settlement is the ultimate victory. It takes the decision-making away from a third party-a judge or jury-and puts it in the hands of the two entities directly involved. Settlement results only from consent, so a case is settled when the parties have retained control over the outcome and have carved out a result for themselves. It doesn't happen unless there is concurrence.
Studies have shown that the parties in a dispute experience better results if they take a reasonable opportunity to settle than if they go to trial. Said another way, studies of hundreds of cases in which negotiations have been conducted but the parties have not settled reveal the odds that the party rejecting an opportunity to settle often does even worse at trial.
To create a settlement, the parties can directly negotiate, or they can use an intermediary. The latter process is mediation. The intermediary, a mediator, can be a sitting judge, an attorney who acts for the courts as a settlement facilitator, or a private mediator from outside the courthouse whom the parties retain-a retired judge, attorney, or, in some cases, a person who has special expertise in the subject matter. Mediators work in all aspects of litigation: complex civil cases, personal injury, professional negligence, complex insurance disputes, and family law matters, particularly divorces and custody matters.
Thankfully, over the last several years, mediation has become the more popular means of resolving disputes. Even so, it is often-mistakenly, in my view-overlooked by lawyers in the beginning stages of litigation when it can lead to an early, and appropriate, settlement.
To note, there is often confusion as to the difference between arbitration and mediation. They are both alternatives to outright litigation as dispute resolution. (Court systems are now designed to make sure that parties are advised about these options. Many court systems have developed programs for early resolution, including the federal court in San Francisco, which has been a pioneer in promoting and engaging this process.) However, in arbitration an arbitrator actually decides the case and can issue an opinion, called an award, which resolves the matter.
Mediation is much different, as the mediator-who is skilled in helping parties to talk and exchange views in an attempt to resolve their differences-oversees supervised negotiation, away from the courthouse; any resolution comes only when both parties agree. In a mediation, neither party can be forced to accept a decision.
A mediation can last anywhere from a few hours to several days (not necessarily in succession). Often the parties exchange "briefs" on their position before the mediation.
Very important to note is that a mediation is confidential. By law, what takes place during a mediation cannot be used as evidence in the lawsuit.
My experience is that the mediation process works best if certain conditions are met. First and most fundamental, the parties must be prepared to mediate. To do this, they must know their case well, have discussed their position with their lawyer, and set some realistic goals for settlement discussions. Second, the parties must go to the mediation with a good faith desire to resolve the case. Third, the chosen mediator needs to be the right person for the case-someone whose approach to mediation fits the type of case and the parties who are involved. If the case is volatile, then someone with a low-key style who employs more diplomacy than persuasion may be the right choice. Or, if the parties are at odds, it may take someone with stature (such as a retired judge of some preeminence) to bring the parties together. And lastly, the mediator must be willing to work-he or she must be ready to persevere until all settlement alternatives are explored. The basic rule is to keep the parties talking. So long as the parties are willing to communicate, there is a chance for a negotiated resolution.
As time goes by, our judicial system will rely more and more on courts and counsels directing litigants to mediation as an alternative to litigation. I say, the earlier the better.
Guy Kornblum is the principal in the 30-year-old law firm Guy Kornblum & Associates, which specializes in representing clients in mediations, trials, arbitrations, and appeals. Guy has taught law at local law schools and has co-authored three legal texts He and his wife, Victoria, are long-time residents of Pacific Heights, where they raised their two now adult children.
