One of the more memorable movie lines is from Forrest Gump (1994) when Gump comments “My momma always said, “Life was like a box of chocolates. You never know what you’re gonna to get.” ”

            Mediations are like that, too; as a mediator, I never know what to expect. I say this because I had two mediations  recently that turned out far differently than I expected. Both involved automobiles. In the first, the plaintiff – I will call her Jane Doe –purchased a used vehicle from a dealership – I will call it ABC Dealership – which sold both new and used cars. Ms. Doe had a continuous problem with steering – it was quite difficult to turn the steering wheel and when she did so, it whined. She took it back to the dealership seven (7) times for repair. . . and it was still not fixed. Believing that enough is enough, she sued. Under the particular statute involved, she was entitled to diminished value i.e. the difference in the value of the vehicle as represented (i.e. without the steering wheel problem) and the vehicle as it was in actuality (i.e. with the steering wheel problem). This sum probably amounted to a few thousand dollars. But, at the mediation, the owner of the dealership proposed an “out of the box” solution to take her car in a generous trade-in, for a new vehicle (that has a generous manufacturer’s warranty) at a reduced price, giving plaintiff incentives and the best financing obtainable in light of Ms. Doe’s credit. While no doubt, ABC Dealership will probably make some money on this deal (i.e. What’s In It For Me!), it will probably cost the dealership more than the few thousand in cash representing the diminution in value. It will also engender goodwill as it is far more than what the statute requires. Clearly, the owner of ABC Dealership was looking for a way to resolve this matter to plaintiff’s satisfaction – one that would not leave a bad taste in Ms. Doe’s mouth.

            In contrast was my other mediation – again involving an automobile. The plaintiff – whom I will call Sally Roe – leased a vehicle for three years. During that period, she brought it to the dealership for different things; one  or two of her complaints were at issue twice. At the end of the lease, she decided to purchase the vehicle. Soon thereafter, she brought the vehicle into the dealership once more to have other issues resolved. At this point, the vehicle was outside of the manufacturer’s warranty and so Ms. Roe did not bring it to the dealership anymore. Approximately 18 months after she purchased the vehicle at the end of the lease, she sued the manufacturer claiming the car to be a “lemon”, alleging defects that were complained of to the dealer once or perhaps twice, years ago.

            Part of my job as a mediator is to provide doses of reality and to manage expectations. So, I discussed the jury instructions that would be used at trial and the fact that a jury may question her credibility and/or motivation since she voluntarily purchased the vehicle at the end of the lease. (i.e. If the vehicle was so bad, why didn’t she simply walk away from it at the end of the lease?)

            My doses fell on deaf ears. Evidently, her attorney had counseled her that this was a good case to take to trial, and if the manufacturer was not willing to repurchase the vehicle, then the matter should be left for a judge and jury to decide. Thus, when I proposed the manufacturer’s cash offer to Ms. Roe, her response was simply that it was time to go to trial, and the mediation was over. She would not counter or negotiate for anything less than a repurchase.

            Two strange mediations, neither ending the way my training and experience would have led me to believe.

            The teachable moment is so obvious that it sometimes escapes me: Mediation is “like a box of chocolates, you never know what you’re gonna get.” Or, be flexible and ready to go with the flow!

            . . .Just something to think about.

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              Recently, I posted blogs on the necessity of “dancing” and on “difficult people”. This past week, both topics collided in a mediation! What an experience!

            The matter was a simple automobile accident in which defendant admitted liability. So, I thought to myself prior to the mediation (and after reading the briefs), this should be easy – just going back and forth between the parties trading monetary amounts as damages – medical expenses, pain and suffering, miscellaneous expenses, etc.

            I was wrong! The plaintiff’s attorney turned out to be impolite and a bully. After introducing myself, I outlined the facts and issues as I understood them from her brief, asking if I understood the facts and issues correctly. She said I did. I asked both the attorney and the plaintiff if either would like to share anything with me. Both said “no”. I asked the plaintiff’s attorney what monetary amount did she wished to demand. She responded that as she had obtained a default judgment (that had later been set aside), the defense was aware of the amount, and so she was waiting for a response. When I asked again, she then gave me an amount (which turned out to be higher than the default judgment amount).

            I then met with the defendant’s insurance adjuster and counsel and conveyed the demand. Noting that the amount now sought was higher than the default judgment, defense counsel provided me with a counter-proposal which I took back to plaintiff’s counsel.

            When I conveyed it to the plaintiff’s attorney, she rejected it, noting that the amount proposed was less than the actual alleged medical expenses. I asked for a counter-demand. The plaintiff’s attorney then informed me that her initial demand was a “take it or leave it” demand. (In essence, she did not want to “dance”.) I told her I would convey this to the defense.

            After meeting with the defendant’s insurance adjuster  and her counsel for a bit, they decided neither to bid against themselves nor to accede to plaintiff’s counsel’s bullying tactics. So, they requested that I go back and convey that they were not prepared to pay the amount demanded. I did and also mentioned that the defense would be willing to entertain a demand for a lesser amount, but was not prepared at this time to pay the requested amount.

            At this point, plaintiff’s counsel was in a dilemma: Does she walk out of the mediation in light of her “take it or leave it” demand or does she stay and lose credibility?

            Suddenly, the plaintiff’s attorney wanted to meet with defense counsel. She did not want to leave and lose the opportunity to settle a case. In doing so, she lost credibility, all leverage and got out bullied or out maneuvered.

            However, in the meeting with defense counsel, plaintiff’s attorney continued to be rude which, thankfully, both defense counsel and I ignored. Neither of us took the bait by responding to her belittling comments. She finally made a demand for an amount that was approximately the same as the amount of the default judgment. When  I asked her to explain the amount, i.e. what were each of the sub-totals (i.e., medical expenses, pain and suffering, miscellaneous expenses etc.) and how had she arrived at each subtotal, her demeanor changed – being forced to engage her “right” brain by analyzing each subtotal and explaining it, her “left” brain or bullying side disengaged. Not only did it help me understand the case from plaintiff’s perspective, it also helped defense counsel to understand the basis for the demand, and thus   be able to explain it to her client – the insurance adjuster – and allow them to justify and document their counter-proposal in the file for audit purposes. The entire tenor of the mediation changed when I asked for the factual basis behind the total amount demanded. It went from emotional to analytical. While plaintiff’s counsel was rude to me once or twice more, I continued to ignore it.

            But, at the end, the bully became meek and accepted the amount that the insurance company was willing to offer even though it was less than her second demand. Miraculously, the matter settled.

            There are two morals here: (1) when negotiating, do not make the initial demand a “take it or leave it” one as it requires either walking out (which is not what one wants to do), or losing face and leverage; and (2) if someone is being “difficult”, do not accede to it, or take the bait, but rather meet it head on and/or ignore it. More importantly, force the “bully” to “analyze” the issues or facts thereby switching to her “right” brain and away from the “left” brain!

            Real life certainly does add flavor to what articles and trainers talk about!

            . . .Just something to think about! 

              The other day, I found a new online magazine in my e-mail box. It was the very first edition, Vol. 1, No. 1 (October 2011) of ADR Times Perspectives on Dispute Resolution.According to the message from the Editor – Ms. Mikita Weaver – this publication started out as an interactive blog, gradually shifting to this very first edition of ADR Times.com covering negotiation, mediation, arbitration, diplomacy and peace.

            Reading the publication, I found that many of the articles covered the fundamentals rather than the arcane. For example, Scott Van Soye discussed “The Negotiation Dance: Five Reasons Not to Sit Out” (at pp. 4-5). I have been in many mediations where counsel wanted to speed up the “dance.” Often, my response is that you can’t; if you do try – you will lose that magical something in the process of “dancing” and the negotiations will fail. Mr. Van Soye puts it more concretely, providing five reasons why the parties must dance!

            The first reason, as identified by Professor Peter Robinson (co-director of the Strauss Institute for Dispute Resolution at Pepperdine Law School) is that most agreements are reached at about the midpoint between the first two reasonable offers. To get to this midpoint, social pressure is placed on each party to share the burden of conceding. “Without a pattern of concessions, sometimes called the “negotiation dance”, this mutual pressure is gone.” (Id. at p. 5).

            The second reason is because it is normal to negotiate; “. . .failing to negotiate leaves your counterpart frustrated, angry that you are being “stubborn” or “unfair” and doubtful that you are really at your bottom line.” (Id. at p. 5). Consequently, without the “dance”, even the best deal may not be acceptable.

            The third reason is that a “take or leave it” approach greatly limits your ability to negotiate as well as  your credibility. If your first proposal is your bottom line, if it is not accepted – you must walk away to maintain credibility. If, instead, you offer something else, your credibility is gone.

            The fourth reason is that the “pattern of the dance significantly impacts the ultimate amount agreed upon.” Studies show that the first move in a negotiation strongly influences the other party’s estimate of value. (Id. at p. 5). By anchoring your first demand at a higher (lower), but reasonable amount, the agreement ultimately agreed upon will be higher (or lower). By being the first to make the proposal, you can set the level (or playing field) of expectation.

            The fifth reason involves “the value of aspirations or optimistic goals.” (Id. at p. 5). “Those with high hopes routinely do better than those with more “realistic” ones. Of course, this assumes that the demands are within the realm of possibility. Ridiculous demands will be ignored. (Id.)

            In sum, if you refuse to “dance”, you will definitely be at a disadvantage in any negotiation. You must “dance” to get the most out of the negotiation: it is that plain and simple.

            . . . Just something to think about!

            Routinely, most local rules of court require that persons with the ultimate authority to settle a matter be physically present at a court settlement conference or mediation. While it does not take much thought to understand the rationale behind this requirement, it may take a bit more thought to appreciate the consequences of not honoring it. I mediated the consequences of not abiding by this requirement the other day.

            It was an employment dispute. Present at the mediation were; (1) the attorney for the defendant; (2) the attorney for plaintiff; and (3) the plaintiff. Both counsel were young associate attorneys, practicing law for less than three years. Both had partners at their respective law firms to whom they answered and who were monitoring the negotiations during the mediation. Further, no representative of the corporate defendant was personally present; I was told the representative was available by telephone.

            After discussing the facts and issues of the case for a little while, the plaintiff’s attorney  conveyed his initial demand to me. However, it was approximately more than twice as much as his previous demand to defense counsel. (For example, if plaintiff’s previous demand was $20, his new demand was $50). When I tried to warn him that this strategy would not go over well, he resisted, insisting I convey it.

            I did, and it was not at all well received. Defense counsel refused to make a counteroffer. So, I held a joint session with both counsel in an attempt to discuss “real” amounts. Slowly, it came to light that plaintiff’s counsel was negotiating as he was instructed to do so by the partner back in the office and was only able to accept a certain amount if it was within a certain range. However, the defense attorney believed that range to be unrealistically high and had already rejected what his client believed to be an excessive demand. Nevertheless, defense counsel had been instructed to keep within that range (even though previously rejected.)

            When I attempted to discuss damages in terms of hypotheticals (e.g. if defense counsel is able to obtain authority to offer $30, will plaintiff accept it?), I quickly found that this tactic was fruitless. Since the amounts were not within the range given to plaintiff’s attorney by his boss, he could make no commitment. Instead, he wanted defense counsel to make a firm offer that he could then discuss with his boss by telephone. However, defense counsel did not “want to go out on a limb” to obtain this increased authority, if it was not going to be ultimately accepted by plaintiff. Each was waiting for the other to make a firm commitment that they could then take back to their supervising partners for approval.

            At this point, I felt like either Vladmir or Estragon waiting for Godot (Waiting for Godot by Samuel Beckett), since each attorney was waiting on the other to make the first move and neither could do so because of the instructions they were given by their respective supervising partners.

            Needless to say, the matter did not settle. The sad part is that both counsel wanted to settle the matter and clearly recognized that the matter should be settled rather than tried. But their negotiations were not their own: they were mere puppets.

            It was a frustrating experience not only for the attorneys and plaintiff but for me as well. There was nothing I could do to help them settle the case as the parties with the authority to settle simply were not there! I was mediating with empty chairs. There was nothing in my toolbox that could help me other than to tell them to go home and keep negotiating via their supervising partners.

            So – this is why the courts require those persons with the ultimate settlement authority to be physically present at a mediation. Without them, the mediation is fruitless: we are simply waiting for Godot.

            . . .Just something to think about.

             People come to mediation to settle their disputes. Or, so they claim! But, do they really want to settle? In her monthly column, One Minute Negotiation Tips, published by the Los Angeles County Bar Association (Vol. IV, No. 9, October 2011), Ms. Linda Bulmash asks this fundamental question: Is Your Client Sure That He/She Wants To Settle?

            The reason for the question is that most people base their answer on whether they think they will be happy or upset with the proposed settlement. As Ms. Bulmash explains:

“At the core of most people’s decisions regarding whether to take an offer is whether they believe they will happy if they get it or how upset they will be if they don’t get what they want. But studies have shown that people are usually wrong when predicting how happy/unhappy they will be … this has been termed “miswanting”. Attorneys and mediators are in a unique position to help their clients anticipate what their future feelings will be.”

     To meet this challenge, Ms. Bulmash suggests that the following steps be taken:

 “1. EDUCATE. Explain the phenomenon of “miswanting” to your client. As an example, you can point out that studies have shown that after the initial excitement, lottery winners are no happier than they were before they won.”

“2. HELP YOUR CLIENT IDENTIFY A DEFAULT HE/SHE CAN LIVE WITH.”

“3. USE FRAMING STRATEGIES. Remember that decision makers are strongly influenced by how information is presented. Since we tend to prefer a “sure thing” to a potential gain, frame the settlement as safer than a trial.”

“4. TIME OUT. Insist your client takes a cooling off period before making the final decision. Time away from the bargaining table makes it easier for people to control their emotions. Take your client for a walk.”

“5. HELP YOU CLIENT TO FOCUS ON THE FUTURE AND NOT THE PAST INJURY OR HURT. Ask your client to imagine waking up tomorrow having not settled and what the day would feel like. Now have him/her imagine what the day would feel like if he/she had settled.”

“6. RECOGNIZE THAT SOME CLIENTS HAVE A DIFFICULT TIME LETTING GO OF THE FANTASY OUTCOME. In some respects, settling is a mourning process. Your client has fantasized about the outcome of this dispute for a long time. The reality of settlement does not compare to the fantasy. Allow your client to express feelings about this.”

            By doing so, a settling party will be more accepting of the settlement and not feel that she was forced into agreeing to it. She will not have regrets or remorse afterwards, having dealt with such issues beforehand!

            . . .Just something to think about!