As I have mentioned previously, I mediate ‘lemon law” automobile/recreational vehicle cases. That is, a consumer, having recurring issues with her vehicle, believes that the alleged repairs by the dealer have not fixed the “problem” and so sues seeking to have the automobile repurchased or replaced. Many times, neither occurs; the manufacturer offers a sum of money which the plaintiff consumer accepts and agrees to keep the vehicle.

 In these mediations, I often feel that there is unequal bargaining power between the plaintiff consumer and the defendant manufacturer. This is especially so when I learn that prior to the mediation, the defendant manufacturer has assessed or evaluated the case, possibly even having conducted a round table discussion about it, and has placed a value on it, setting a monetary sum on how much it is willing to offer in settlement. This occurs more often than not! Through experience, I have learned that very rarely will the defendant manufacturer agree to go much higher than this pre-determined limit; maybe $1,000 but usually not more! Thus, I sometimes feel like I am tilting at windmills!

So, here am I with plaintiff, in a mediation whose result almost feels pre-determined. The defendant manufacturer has a set amount in mind: plaintiff can take it or leave it.

Recently, I read an article on www.mediate.com by Jeffrey Krivis entitled “How Did They Price The File?” which notes that a plaintiff’s situation may not be as bleak as I have painted it. Mr. Krivis suggests that by doing some “prequalification” work, plaintiff or her counsel can greatly improve the situation at mediation. Just as a consumer provides a financial institution with a lot of information in order to prequalify for a loan, Mr. Krivis suggests that prior to the mediation, plaintiff’s counsel should essentially do the same thing: share with defense counsel what are plaintiff’s goals and objectives, how she values the case and why, and otherwise share as much information with the defense as possible to insure that the defendant “prices the file” correctly.

Conversely, Mr. Krivis suggests that the defendant do the same with plaintiff: share information regarding the criteria it uses to value the case; is it standard criteria and/or is it something special about this case that causes certain value to be placed on it?

So that the mediation is successful, Mr. Krivis notes that this informational exchange should occur well prior to the mediation and perhaps even with the help of the mediator in a telephone conference call to discuss objectives and expectations. Or, this information can be exchanged in non-confidential mediation briefs; but again, well in advance of the mediation.

Where necessary, plaintiff should, prior to the mediation, discuss large monetary demands with the defendant so that the defendant has ample time to present it to the upper levels of the organization (i.e. “up the chain the demand”) for discussion and/or approval.

In short, the key is sharing information, goals and objectives with the other party well prior to the mediation. By doing so, a plaintiff will have input on how defendant “prices the file” so that when she walks into a mediation, she will not feel as though the ultimate resolution has been pre-determined by some supervisor at some corporate headquarters somewhere else in the country.

Similarly, I, as a mediator, will neither feel as though my hands are somewhat tied as defendant has already determined how much or little movement it is willing to make, nor that my input will have little weight as the evaluation has already taken place!

. . .Just something to think about!

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On August 19, 2010, the Second Appellate District of the California Court of Appeal issued an opinion in which it upheld mediation confidentiality. In Radford v. Shehorn (Case No. 2d Civil No. B216323) ( Radford v Shehorn), the court held that it was error to admit the declaration of a mediator into evidence on a motion to enforce the settlement but that the error was harmless. Consequently, the appellate court affirmed the trial court’s ruling to enforce the settlement.

Suzanne C. Radford and Melina Shehorn are sisters and also beneficiaries of a trust created by their parents in which Shehorn was the sole trustee. After their parents died, Shehorn as sole trustee, distributed the assets of the trust. Radford filed a petition in probate court  challenging the distribution. The court ordered the parties to mediation.

During the mediation, the parties settled. They entered into a two-page settlement agreement. The first page was a printed form provided by the mediator, which included a release and also stated that the agreement “. . .is binding on the parties pursuant to [Code of Civil Procedure] §664.6. . . and is admissible in court as set forth in Evidence Code §1123. . . .”  This page 1 was signed by Shehorn and her attorney but not by Radford and her attorney. It was marked “Page 1 of 2.” (Id. at 2).

The second page, marked “Page 2 of 2”, was entirely handwritten, containing the substantive terms of the settlement. It was signed by both parties and their attorneys.

Thereafter, Radford took the position that she was not bound by the agreement. Shehorn filed a motion to enforce the settlement submitting separate declarations both from her attorney and the mediator, each stating that the agreement consisted of two pages, not just the second page as Radford claimed. In opposition to the motion, Radford contended that she never signed page one and was of the impression that there would be no settlement until a final typewritten agreement was signed by the parties. She further stated in her declaration that she did not receive page one until about a week after the mediation when her attorney sent it to her.

At the hearing on the motion to enforce the settlement, Radford objected to the mediator’s declaration. The trial court overruled the objection, determined that the settlement agreement did, indeed, consist of two pages and held it to be enforceable. In doing so, it relied on the declarations of the mediator, Shehorn and her attorney.

The appellate court affirmed, although it determined that the trial court should not have admitted the mediator’s declaration into evidence. Because the trial court, relying solely on the other two declarations (i.e., Shehorn’s and her attorney’s), would have still reached the same result, the appellate court found the error to be harmless.

In reaching this ruling, the appellate court cited California Evidence Code §703.5 which provides in part, that no mediator “. . .shall be competent to testify, in any subsequent civil proceeding, as to any statement, conduct, decision or ruling, occurring at or in conjunction with the prior proceeding. . . .” The court also relied on Evidence Code §1121 providing that a mediator cannot submit to a court a report, assessment, evaluation, recommendation or finding. . . unless the parties agree otherwise. Further, the court cited Evidence Code §1123 which provides that a settlement agreement reached at a mediation may be admitted into evidence if the parties agree that it is admissible or subject to disclosure; or binding or enforceable or words to that effect. (Id. at 4-5).

Finally, relying on prior decisions of the California Supreme Court, “ “. . .broadly [applying] the mediation confidentiality statutes and . . .severely [curtailing] courts’ ability to formulate exceptions” ” (Id. at 5), the appellate court determined:

“The mediation confidentiality statutes prohibit a mediator from testifying to anything about the agreement, including the number of pages it contains. The trial court erred in admitting Hadden’s [mediator’s] declaration into evidence, but the error is harmless.” (Id. at 5).

As those in California may be aware, the Second Appellate District has routinely been finding exceptions to mediation confidentiality and just as routinely, has been reversed by the California Supreme Court. Indeed, two of its decisions (in which it decided that mediation confidentiality did not preclude evidence to be admitted of what occurred during a mediation in a subsequent legal malpractice suit)  are pending review by the California Supreme Court. In sum, its batting average is well below the Mendoza line.

So. . . perhaps this time, the Second Appellate District Court got it right – probably because there was a clear statute in point: Evidence Code §703.5 prohibiting (in clear and precise language) a mediator from testifying in any subsequent civil proceeding about anything that occurred during the mediation.

The question I have – is why did the mediator even agree to submit a declaration in the first place? As a mediator and a retired judge – didn’t he know that he was not competent to testify under Evidence Code §703.5?

. . .Just something to think about!

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Each week my friend and colleague Maria Simpson, Ph.D. writes a Two-Minute Training tip. Although her August 10, 2010 topic, “Nine Steps For Successful Negotiations,” allegedly takes three minutes to read; it is well worth the extra minute. In essence, she sets out how to participate in a successful mediation:

“1.      Plan. Most of us plan by figuring out generally what we want, but that’s about it. Other things to consider are:

• • What the other side wants. You can’t make an acceptable offer if you don’t have an idea of what is desired and valued.
  • What you are willing to give up, what “concessions” you can make. List what you want in order of priority and then determine what is lowest on your list. This might be the item you can most easily give up, especially if it is something the other side wants. What has no value to you might be very valuable to someone else.
  • What your high and low boundaries are. What is the least you are willing to accept on a particular issue, and what is the most you are willing to give up on an issue? Even if these boundaries move a bit during the negotiation, having a sense of what they are will help you evaluate demands and offers from the other party.
  • What package you want at the end. How many times have you thought that you would never have agreed to A if you had known what B was going to be? And how many times have you thought you couldn’t renegotiate A now that B was known? Think of the outcome as a package, not as a list of discrete items.

2.      Allow people to tell their stories. Not only does this indicate respect for the other party, but it can provide valuable insight into what is important to the other party and what the basis of the agreement might really be.

3.      Surface the underlying issues. A negotiation is not only about what resources or tangibles will be divided up, but about what drives the need for these resources or tangibles and especially the quantities of these items. “What needs to be divided up,” the stuff being discussed, is the “what” of the negotiation. The underlying issues are the emotional part of the discussion, the why, and indicate what drives people to take the positions they present. Knowing why something is being asked for will help to determine how strong that desire is and how much room for negotiating there is. It might also indicate what else might be introduced into the discussion that might present a new alternative.

4.      Bargain appropriately. Don’t make offers that will automatically be rejected as frivolous or insulting by the other party. The purpose of negotiating is to continue the process until resolution, not to end the discussion, and an insulting offer will end it quickly.

5.      Know when to walk away, but don’t walk out too quickly, either. Sometimes just hanging in there for a little while longer will demonstrate a seriousness of purpose that will move the process along or raise an important but not previously considered position that has to be addressed. On the other hand, staying too long when there is clearly no hope of agreement is a waste of time. Consider carefully what will happen if you leave, and then decide.

6.      Write the agreement. It is always best to have the parties write the agreement jointly, while they are still in the room, rather than to have one party draft it and the other party respond. The party that drafts the agreement has control over the language, and the discussion will become a series of challenges to, and defenses of, the language instead of a discussion of the issues. If possible, have a neutral third party draft the agreement based on conversations with both parties.

7.      Consider the package as a whole. Do the elements balance? Did you get at least much of what you wanted? Is the other party reasonably satisfied or will the agreement fall apart in a few months? Until the agreement is signed, you have time to re-consider. Just be sure that new issues are serious enough that they must be raised even if you think the whole agreement might fall apart.

8.      Stay flexible. Be prepared to change your understanding of the situation and of each party’s needs based on new information, and therefore, to change the elements of the agreement if necessary. New information can provide a new direction and a better agreement.

9.      Be mindful of future relationship issues. Don’t force an agreement that makes the other party resentful and angry. Help them save face, or the agreement won’t last and you will have to go through the process again. It will be more difficult to renegotiate than to negotiate thoughtfully the first time.”

I cannot emphasize enough how important it is to prepare and plan ahead of time. “Winging it” will lead to disaster which, unfortunately, I have seen all too often. The same way that athletes “visualize” what they are about to do, so should a negotiator. Think it through; “visualize” how you want the negotiation or mediation to proceed. Doing so will improve immensely your chances of reaching a resolution.

. . .Just something to think about!

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On July 17, 2010, the Southern California Mediation Association (“SCMA”) held its annual Townhall. As president, I had the honor of choosing the topic for discussion. I chose “rights v. resolution”, based on a presentation given by the Honorable Wayne D. Brazil, United States Magistrate Judge in the Northern District of California at the American Bar Association (“ABA”) Dispute Resolution Section’s Conference in New York City in April 2009.

This notion juxtaposes the rights given to litigants in the civil justice system, especially  the Seventh Amendment right to a jury trial with the use of the alternative dispute resolution (“ADR”) process to resolve a dispute. In short, is the mediation community causing litigants to forego their “rights” in court by encouraging (manipulating?) them to “resolve” their disputes at mediation?

Through three different panel discussions, our Townhall focused on this issue from the perspective of the judiciary, the plaintiffs and defense bar and the ADR professional and trainers. Needless to say, the discussion was quite spirited, provoking much comment and thought.

I turn to this topic of “rights v. resolution” because last week, I opened the latest issue of the ABA’s Dispute Resolution Magazine (Vol. 16, No. 4, Summer 2010) to see that Judge Brazil once again addresses this notion in his article, “Rights v. Resolution in Mediation; Our Responsibility To Debate The Reach of our Responsibility.”

According to Judge Brazil (as well as the panelists at our Townhall), this issue – rights v. resolution –

“. . . has taken on considerable added significance with the apparently increasing marginalization of our courts [and] . . .[t]he growing disproportion between transaction costs and case value…. [As a result], . . . many cases of modest economic value and many litigants of limited means have been effectively priced out of the court system. So, more and more people must look to something other than the adjudicatory process to address their problems. ” (Id. at 9).

Indeed, Judge Brazil notes that only the “close ones” i.e. “the ones in which rights are most difficult to determine” are going to trial and that more and more cases in federal court at both the trial and appellate levels are being handled by the actual party, without the assistance of a lawyer. (Id. at 9, 10).

So, given that more and more mediations are occurring, Judge Brazil queries what is the role or responsibility of the neutral in insuring that this “rights v. resolution” tension does not tip more one way than the other?: that is, that outcomes do not overtake legal entitlements? (Id. at 10). Judge Brazil queries what is “the extent of our responsibility for the alignment of outcomes with legal entitlements?” (Id. at 10).

How, can I, as a neutral, insure that this balance is maintained? Especially, when the parties come to mediation unprepared or not knowing all of the facts, and/or not knowing all of evidence. Often times, they have not conducted any discovery so as to contain costs, hoping that an early resolution is available. Or, they come to mediation with the expectation that I, as a neutral, will provide them with guidance on issues that they know more about than I do (even though, it is their case, not mine.) Or, it is a matter in which they have not divulged everything to me and/or opposing counsel and/or is one in which they are attempting to manipulate me and/or the other parties. Or, the matter is one in which one party has much more leverage than the other and thus  the situation makes one party much more vulnerable than the other. Or, it is a matter in which all parties and counsel, except for the plaintiff, are repeat or institutional players going through the motions of a mediation, knowing pretty much what the outcome will be, before the mediation even starts. (Id. at 11). Only the actual plaintiff is a “one-shot” player with no inkling that the mediation and its processes are pretty much scripted out already. In all of these situations, what is my responsibility to insure rights do not overtake resolution or vice versa? (Id. at 10-11).

And then, Judge Brazil points out “the indeterminacy of civil litigation. (Id. at 11). Does the fact that litigation seems to take “forever” to get resolved provide a convenient excuse to end it now at mediation? This notion was especially raised at our Townhall given the fiscal crisis of California’s state courts causing courtrooms to be shuttered, and employees to be either laid off or furloughed. How important is expediency over constitutional rights? Should it even be? (Id. at  12.)

As you might surmise, Judge Brazil concludes that the responsibility of a neutral to insure that resolutions do not overtake rights must be viewed on a mediation to mediation basis.  Even the same neutral must take a different approach to this issue from one mediation to the next, depending on the parties, the subject matter and the type of dispute. Is it a civil case? A family law matter? A class action? Are the parties sophisticated? Institutional or repeat players? Or, the opposite? Is the ADR process private? Or court-ordered? Is it mediation? Arbitration? Early Neutral evaluation? Et cetera. All of these issues and more must be considered by the neutral in her attempt to insure that the proper tension between rights and resolution is maintained. (Id.)

In sum, there seems to be a lot more to being a mediator than just mediating. While I am very much interested in having parties settle their cases, I must be mindful that settlement is not the end all, be all, or the sole and only goal in mediation; resolution cannot be achieved at the expense of litigants’ “rights” under our system of jurisprudence. And, as hard as I try, I am not always sure where the line exists between these two notions in any given mediation. It is a difficult task to find this balance  and insure that it is maintained but I will keep looking. . .!

. . .Just something to think about.

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In its July 27, 2010 guest blog, Scientific American published an article by R. Douglas Fields entitled, “Of Two Minds: Listener brain patterns mirror those of the speaker.” In it, Mr. Fields discusses a study (published in the July 26, 2010 issue of Proceedings of the National Academy of Sciences) showing that simply by speech, a speaker “. . .can project her own brain activity onto another person” such that the neural activity of the listener will closely mirror that of the speaker. (Id.)

Using functional magnetic resonance imaging or fMRI, the researchers examined both the speaker’s and the listener’s brain activity patterns while they communicated with each other. What they found was that:

“. . . when two people communicate, neural activity over wide regions of their brains becomes almost synchronous, with the listener’s brain activity patterns mirroring those sweeping through the speaker’s brain, . . .with a short lag of about one second. If the listener, however, fails to comprehend what the speaker is trying to communicate, their brain patterns decouple.” (Id.)

The researchers found that “the better matched the listener’s brain patterns were with the speaker’s, the better the listener’s comprehension. . . .” (Id.) Thus, if a listener truly comprehends what the speaker is saying, her brain imaginary will mirror the speaker’s. If, on the other hand, the listener hasn’t a clue about what the speaker is saying, her brain imaginary will show that as well: there will be absolutely no mirroring.

The researchers also found that when a listener is fully comprehending what the speaker is saying, her own neural activity preceded that which was about to occur in the speaker’s brain. That is, she anticipated what the speaker would say next!

As explained by the lead investigator, Uri Hasson, “communication is a joint activity, by which two brains become coupled.” (Id.)

This research intrigues me because one of the basic concepts in mediation is “active listening” (which means to listen carefully to what the speaker is saying and how it is being said and then use various techniques such as paraphrasing or restating the speaker’s remarks to make sure the listener understands what is being said. It is a continuous and interactive process of listening and providing feedback.) This research confirms that there really is an “active” in active listening: when we truly listen to someone and comprehend what she says, our neural activity will closely mirror the speaker’s to the point that our own neural activity may well mirror what is about to occur next in the speaker’s brain. We can anticipate what the speaker will say next.

And, I have learned that mirroring or mimicking is one of those great tools that can lead to agreement. If one mirrors or mimics the body language of another, that other person will tend to become more receptive to you, albeit, subconsciously. That is, the more similar you are to someone, the more agreeable she will become. And the more agreeable a person is, the more likely a resolution will be reached.

So,. . . there really is something to “active” in active listening: it epitomizes a joint activity through which resolutions can be reached.

. . .Just something to think about.

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