2. Select the acceptable mediation behavior:
(a) Do not make a non-negotiable demand in the joint session and threaten to walk out if your demands are not met.
(b) In any mediation always demand that the other side pay your client’s car payments and all mediation expenses.
(c) A demand set to rhyme such as “I want my way or I hit the highway” worked for Johnny Cochran and it will also work for you.
Answer: (a) Making non-negotiable demands at the joint session, according to Mr. Davidson, is totally inconsistent with the reason for mediating. The “take-it or leave-it” approach may be a good negotiating tactic in some situations; however, especially at the beginning of mediation, it will very rarely facilitate a dialog leading to a resolution.” Mr. Davidson notes one may draw a line at some point during the mediation but drawing it at the outset more often than not ensures the failure of the process.
3. Which of the following is a correct statement of the use of demonstrative exhibits at mediation:
(a) At many successful mediations, counsel used demonstrative exhibits to great effect.
(b) Shadow hand-puppets tell a story effectively.
(c) A Power Point presentation without background music is a waste of time.
Answer: (a) Mr. Blitman notes “Sometimes the facts become clearer when they are seen rather than heard.” Graphs, charts, timelines, photographs, “whatever will demonstrate the facts in a compelling way can be used.” Mr. Davidson suggests bringing crucial documents to the mediation provides the mediator with the ammunition needed to persuade the other side of its weaknesses.
4. When presenting your position at mediation:
(a) Provide legal support rather than advance arguments supported only by your logic.
(b) Always rely on California case law.
(c) Making up case authority from the Sixth DCA is not only creative but effective and fun.
Answer: (a) Mr. Davidson notes mediation is a form of mini-trial and legal issues should be presented. Can attorney’s fees be awarded? Which law is controlling? What is the statute of limitations? Give the mediator case authority that will enable him or her to resolve a divisive issue. “If you continue to argue in the abstract you enhance your chances for an impasse and, therefore, a failed mediation.”
5. Which of the following is the proper mediation technique?
(a) Everyone at the mediation should dress for success.
(b) At mediations, clothing is optional, but you can’t go wrong with a Hulk Hogan T-shirt.
(c) Narrow ties and wide lapels project you as an authority figure.
Answer: (a) As silly as it may sound, Mr. Blitman states how the parties and counsel dress may affect the outcome of mediation. A well-groomed party and a professional appearance by counsel will mean the party and the attorney may be taken more seriously. “Effective advocates know their clients and present them in the most favorable light possible at mediation.”
6. An effective mediation ingredient is:
(a) All counsel are prepared.
(b) Trial by combat.
(c) During the joint session intentionally refer to opposing counsel and parties by the wrong name or as “Bozo” and opposing counsel as a “Hoot”.
Answer: (a) According to Mr. Blitman, the mediation has no chance of success in any sense of that term if counsel for either side is not prepared. Mr. Davidson notes lack of preparation makes settlement unlikely in that counsel may reject a reasonable offer if unprepared or may be persuaded to accept a resolution where you pay too much or receive too little.
7. Which of the following contributes to a successful mediation environment:
(a) A neutral, comfortable site with facilities to meet the professional needs of the participants.
(b) Coffee selections including Mocha Settlementcino and Vente Compromiso Latte.
(c) Make sure there is no food available and no restrooms: The other side will always cave if you can tough it out.
Answer: (a) Many mediation participants do not recognize the benefits of a neutral site. Insisting on holding a mediation at the office of one of the parties or the office of one of the attorneys often is perceived as maneuvering for leverage. A site that is too small for the parties, does not have breakout rooms and does not meet the physical comforts and needs of a party (work tables, bathroom facilities, snacks, drinks, etc.) often leads to one or both sides losing patience and a premature end to the mediation.
SCORE: Give yourself 10 points for each correct answer. If you missed any of the questions, you may want to give serious thought to reading the above-referenced “Handbook on Mediation” and checking yourself into a clinic with Britney Spears (minimum of one week). In the alternative, consider attending an upcoming CLE seminar “Astrology and Mediation: How to Avoid the Capricorn-Pisces Impasse”.
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Published 5/2008 in EJCBA Newsletter, The Forum Eight
By: Chester B. Chance and Charles B. Carter
MEDIATION, PROBABILITY AND MATHEMATICS
If you are looking for a semi-humorous quiz or a mediation allegory on fruitcake consider setting this article aside and opting for Comedy Central. This month's article requires thinking-caps be donned and buckled.
In 1988, John Allen Paulos wrote a book entitled "Innumeracy". He wrote the book to address a perceived need for the average Joe/Jane to better understand concepts of probability and numbers. Paulos suggests that when people have to make decisions regarding “numbers” and “probabilities” their responses and choices, in part, are determined by how the problem or question is framed. You are thinking to yourself that the Paulos book on mathematics and probability has little to do with mediation. But, you would be as wrong as you were in believing you would follow through on your New Year's resolutions. You would also be guilty of allowing your math phobia to affect your need to understand concepts vital to a successful mediation. Read on.
Paulos discusses and illustrates a seemingly irrational aspect of "innumeracy" which characterizes many of our most critical decisions. The illustration is in the form of a question:
Imagine you are a general surrounded by an overwhelming enemy force which will wipe out your 600-man army unless you take one of two available escape routes. Your intelligence officers explain that if you take the first route you will save 200 soldiers. If you take the second route the probability is 1/3 that all 600 will make it out alive and 2/3 that none will. Which route do you take? Quick, decide!
75% of people choose the first route, since 200 lives can definitely be saved whereas Paulos notes the probability is 2/3 that the second route will result in even more death. Psychological studies conclude people tend to avoid risk when seeking gains.
"So far, so good" says Paulos. Now, the next question. You are a general once more forced to decide between two escape routes. If you take the first one, 400 of your soldiers will die. If you choose the second, the probability is 1/3 that all of the soldiers will make it, and 2/3 that all 600 will die. Which route will you choose? Hurry-up and decide since the Spartans are coming!
80% of people in this situation will choose the second route, reasoning that the first route will lead to 400 deaths, while there is at least a probability of 1/3 that all will get out fine if they take the second route. Men and women choose risk to avoid losses.
Too much math? Hang in there and consider this: The two questions are identical. "The differing responses are a function of how the question is framed, whether in terms of lives saved or of lives lost", notes Paulos. Remember: people tend to avoid risk when seeking gains, but, choose risk to avoid losses.
Another example from Paulos: Choose between a sure $30,000 gain or an 80% chance of winning $40,000 and a 20% chance of getting nothing. Most folks will take the $30,000 "even though the average expected gain in the latter choice is $32,000 (40,000 x .8)." Why? Again, people tend to avoid risk when seeking gain.
Consider this question: Would you accept a sure loss of $30,000 or an 80% chance of losing $40,000 and a 20% chance of losing nothing? In response, most people will take the chance of losing $40,000 in order to have a chance of avoiding any loss, even though the average expected loss in the latter choice is $32,000 (again, 40,000 x .8). Why? Folks choose risk to avoid loss.
Need another example? I’ll put two stacks of envelopes by the door as you are leaving your office. You can choose to pick an envelope from only one stack. All the envelopes on the left side contain $20 bills. Three out of four of those on the right are empty, but one in four contains a $100 bill. Which one would your choose? The choices were framed as “gains”. People tend to prefer the sure bet ($20). “This risk aversion means people will give up a higher-value but riskier option to ensure they at least get something”, according to Timothy Hedeen, Ph.D.
How about a final example? On the way into your office two people will be standing on either side of the door. In order to get in you will have to pay one of the two people. The gatekeeper on the left will let three of four people enter for free, but will charge one in four $100. The gatekeeper on the right will charge everyone $20. Which gatekeeper would you choose? This choice was framed in terms of “losses”. People tend to select the risk (the chance of paying nothing). According to Timothy Hedeen, Ph.D., this loss aversion is a form of risk tolerance in which people are willing to take an irrational risk in order to avoid a definite loss.
How does a dusty book from 20 years ago on probability relate to your law practice? How does this play into mediation or how does it determine what deductible you select for your car insurance? How does it flavor your perception of whether the glass is half full or half empty? Well, simply put: how a question or statement is framed involving issues of gain, loss and risk greatly determines how someone responds to it. That is why the role of a mediator is to reframe issues. To reframe a concept is to change how people perceive it or how they think about it.
Mediation involves analyzing gain, loss and risk. How the attorney and the mediator frame that risk decision to a party is a big factor in what the party chooses to do in terms of settlement and resolution.
Your homework assignment:
Role-play two mediation scenarios involving:
A. Your client has to make a decision as to whether to accept an offer from the other side.
B. Your client has to make a decision as to whether to pay an amount to the other side.
How will you frame this decision to your client in terms of your new found knowledge that people tend to avoid risk when seeking gains, but, choose risk to avoid losses? The risk is trial.
Submit your answers in essay form. Pop quiz next month on Chapter 2: Mediating the Middle East Crisis (determine whether you need to reserve a half-day or a full day for the mediation).
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Published 6/2009 in EJCBA Newsletter, The Forum Eight
By: Chester B. Chance and Charles B. Carter
MEDIATION: THE START AND FINISH LINE
Many of you may know Richard and Jane Hiers. Richard was a respected professor of religion at the University of Florida and a graduate of the U. F. Law School. Their daughter, Rebecca H. Hiers published an article in the Rutgers Law Review entitled, “Navigating Mediation’s Uncharted Waters”.
Ms. Hiers raises many questions involving mediation issues, including what she characterizes as “Beginnings, Endings and In-Between”.
These questions include: For purposes of a mediation privilege: When does mediation begin? Are communications between sessions protected? When do mediations end? Are all topics protected?
In Florida, many of the questions raised in the Rutgers article are addressed by the statutes and court rules dealing with mediation.
When does mediation begin? Section 44.404(1), Florida Statutes states a court ordered mediation begins when an order is issued by the court. In all other mediations, the mediation begins when the parties agree to mediate.
When does mediation end? Section 44.404, Florida Statues states mediation ends: (1) when a partial or complete settlement agreement is signed by the parties; (2) when the mediator declares an impasse by reporting to the court the lack of an agreement; (3) by agreement of the parties.
Thus, the Florida Statutes define the start and finish lines for mediations.
What is protected and subject to the privilege of confidentiality? According to Section 44.405, Florida Statutes “all mediation communications shall be confidential”. This begs the question: what is a “mediation communication”?
Luckily, in Florida, Section 44.403(1) Florida Statutes defines a “mediation communication” as an oral or written statement, or non-verbal conduct intended to make an assertion by or to a mediation participant made during the course of mediation, or prior to mediation if made in furtherance of a mediation.
Section 44.405(2) Florida Statutes defines a “mediation participant” as including a mediation party or a person who attends mediation in person or by telephone, videoconference or other electronic means (I-pod?).
The Florida Statutes seemingly address issues raised in other states which are discussed in the Rutgers article, including:
(1) Are discussions with the mediator before the mediation conference begins (including arranging for the mediation) privileged? (Apparently they would be if made prior to the mediation but in furtherance of it. See Section 44.403(1) Florida Statutes).
(2) Are communications between sessions protected? Probably “yes” if one assumes a mediation process continues until the “end” as “end” is defined in Section 44.404 Florida Statutes. “During the course of a mediation” includes statements made in furtherance of a mediation and seems analogous to language found in the statutes of other states referred to in the Rutgers article including language which protects communications “in connection with the mediation” or “in the course of the mediation process”.
Who may assert the privilege and the issue of whether all communications at mediation are protected (Are threats of violence protected, and, when does something become a threat?) will have to be the subject of another article. It is good to note Florida appears to have statutes, which assist participants as they navigate mediation’s uncharted waters.
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Published 1/2009 in EJCBA Newsletter, The Forum Eight
By: Chester B. Chance and Charles B. Carter
STATISTICALLY, SETTLING IS BETTER THAN GOING TO TRIAL
Many of you have been kind enough to send us an article which was published in the New York Times in August 2008.
The article previewed a study published in the September issue of the Journal of Empirical Legal Studies. The study was done by analysts who have a consulting firm that advise clients on litigation decisions.
According to the co-author of the study, Randall L. Kiser, “The lesson for plaintiffs is, in the vast majority of cases, they are perceiving the defendant’s offer to be half a loaf when in fact it is an entire loaf or more”. The conclusions from the study of civil lawsuits found most of the plaintiffs who decided to pass up a settlement offer and went to trial ended up getting less money than if they had taken the offer.
The study notes the vast majority of cases settle (somewhere between 80% to 92% by some estimates according to Mr. Kiser). In the cases that did not settle, plaintiffs ended up getting less than the last defense offer in 61% of the cases that went to trial. Defendants made the wrong decision less often, i.e., in 24% of the cases according to the study. In 15% of the cases that went to trial the defendant paid less than the plaintiff had wanted but the plaintiff got more than the defendant had offered. The study notes the mistake of rejecting a settlement proposal was made more often in cases in which the lawyers are paid a share of whatever is won at trial (contingency fee). Other studies (see Lawyer Negotiation by Jay Folberg and Dwight Golann) suggest the tendency to be optimistic and overconfident becomes stronger when the person making the judgment acquires a personal stake in the outcome.
The study suggests 61% of plaintiffs ended up getting an average of $43,000 less than the defendant’s last offer prior to trial. Defendants, even though they were less often wrong in proceeding to trial (24% of the time), when a verdict was entered for more than what the plaintiff had demanded for settlement, the verdict was on average $1.1 million dollars more than the last demand.
The findings suggest to the authors of the study that lawyers may not be explaining the odds and risk of proceeding to trial to their clients or the clients are not listening to their lawyers. The authors of the study note law schools do not teach how to “handicap” trial nor does law school help develop the skill of telling a client that a case may not be a winner (noting clients do not like to hear such news).
“Most clients think they are completely right . . . . A good lawyer has to be able to tell clients that a judge or jury might see them differently . . . . Part of it is judgment and part of it is diplomacy” according to attorney Michael Shepard of San Francisco.
The study found factors like the years of experience of a lawyer, the rank of a lawyer’s law school and the size of the law firm were not helpful in predicting the results of a decision to go to trial. The most significant factor was the type of case, i.e., poor decisions by plaintiffs to go to trial are associated with cases in which contingency fee arrangements are common. Also, the study found on the defense side, errors more often occur in cases where there is no insurance coverage.
A separate study done 30 years ago by Gerald R. Williams interviewed attorneys in cases that went to trial. The attorneys were asked their opinion of why the case proceeded to trial. Fifty-three percent (53%) of those asked said the reason was the failure by one party to agree to the terms recommended by their own attorney. Williams comments that the usual emphasis in legal negotiation is upon the process by which attorneys reach agreement with one another. However, Williams suggests the more important focus should be upon the process by which the disputing parties themselves move from conflict to agreement.
The authors of this column conjecture most of the cases going to trial in the study are cases which involve strong liability issues. The study notes in the 61% of the cases where plaintiffs did worse by going to trial the defendant had offered an average of $48,700 and the plaintiff had demanded $565,800. The average final award to the plaintiff was $5,700. That suggests a lot of “defense verdicts”.
In the 24% of cases where the plaintiff did better by going to trial, the average plaintiff demand was $770,900, the average defendant offered $222,400 and the final average award was $1.9 million. This again suggests cases in which the defendant was gambling on the liability issue. Perhaps the motivating factor for plaintiffs in these situations is the old adage, “if you ain’t got nothing, you got nothing to loose”.
In only 15% of the cases which proceeded to trial, the jury award was somewhere between the plaintiff’s last demand and the defendant’s last offer.
Clearly this study suggests going to trial is risky for both parties. The majority of the time the plaintiff will do worse than the last offer. The defendant will do worse less often than the plaintiff, however, the monetary risk is much higher for the defendants in those situations.
It appears that when defendants feel there is no liability, more often than not the jury agrees with the defendants. Only 24% of the time will the plaintiff “ring the bell”. Over 60% of the time the case will proceed to trial and result in a defense verdict or a low verdict.
The study has enough information to give pause to both sides and to give comfort to those who have resolved and settled a case at mediation, i.e., take comfort in the fact that statistically, they made the right decision by settling.
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Published 2/2009 in EJCBA Newsletter, The Forum Eight
By: Chester B. Chance and Charles B. Carter
NEGOTIATION IN GOOD FAITH
At the mediation conference a representative of the defendant’s insurance carrier appears at the conference. The representative discusses the underlying facts and circumstances of the case. In addition, the insurance representative states there has been insufficient time since service of process to take a discovery deposition of the plaintiff or to do an independent medical examination. She offers $1,000 to settle the case. After several caucus sessions, the mediator reports to you that the defendant steadfastly refuses to increase the offer under the circumstances.
You argue that although the case is a soft tissue injury, a chiropractor gave your client a disability rating of 5% to the whole body. You argue the defendant’s policy limits are $10,000. You assert the defendants and their insurance carrier appeared in mediation with unclean hands and not in good faith and move for sanctions seeking attorney’s fees and costs.
Will you prevail?
In Avril v. Civilmar, 605 So.2d 988 (Fla. 4th DCA 1982) the court noted Rule 1.720(b), Florida Rules of Civil Procedures allow sanctions only for failing to appear at a duly noticed mediation conference. The appellate court determined plaintiff’s only basis for requesting sanctions “. . . is merely that the defendants were unwilling to make an offer of settlement satisfactory to him. The mediation statutes however, do not require that parties actually settle cases”.
The court referenced Chapter 44 of the Florida Statutes including the definition of mediation as an informal and non-adversarial process with the objective of helping the disputing parties reach a mutually acceptable and voluntary agreement. “It is clearly not the intent to force parties to settle cases they want to submit to trial before a jury. There is no requirement that a party even make an offer at mediation, let alone offer what the opposition wants to settle”.
SIGNING THE MEDIATION AGREEMENT
Elizabeth Collins has forwarded a November 12, 2008 opinion from the Third District Court of Appeal in Mastec, Inc. v. Rolando Cue. The case involved a personal injury lawsuit which was mediated and the defendant alleged the parties agreed to a settlement at mediation. However, it was undisputed the mediation agreement was not reduced to writing and signed by the parties. The trial court denied the Motion to Enforce Settlement. The appellate court determined the lack of a written agreement signed by both parties was more than a mere technical deficiency and the alleged mediation settlement was unenforceable.
The Mastec decision references Jordan v. Korden Adventist Health System, 656 So.2d 200 (Fla. 5th DCA 1995) which determined the absence of a writing containing an attorney’s signature is a technical detail which the court may ignore. In Jordan, the parties reached a settlement after extensive negotiations and a preliminary agreement was reduced to writing and signed by the parties but the agreement was not signed by counsel. Because Rule 1.730(b) FRCP requires that a mediation agreement be signed by the parties’ counsel, one of the party’s argued the preliminary agreement was unenforceable. The Fifth District Court held a party could not avoid the agreement by relying on this “technical detail”.
The appellate court also referenced Gordon v. Royal Caribbean Cruise, Ltd., 641 So.2d 515 (Fla. 3rd DCA 1994). In Gordon the defendant sought to enforce a mediation agreement against a client/party who did not sign the agreement although the party’s counsel did sign it. The Third District Court held the signatures of the parties are necessary and an attorney’s signature alone, even in the presence of his client, is wholly insufficient. In Gordon, the court distinguished cases involving settlement agreements which were not reached during court ordered mediation.
In summary, a mediation agreement appears to be enforceable if signed by the parties but not by their counsel and a mediation agreement signed by counsel but not by the parties is not enforceable.
Thanks to Elizabeth Collins for providing this updated case law.
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Published 3/2009 in EJCBA Newsletter, The Forum Eight
By: Chester B. Chance and Charles B. Carter
COMMON ERRORS IN MEDIATION ADVOCACY
Tom Arnold is the author of “20 Common Errors in Mediation Advocacy”. Mr. Arnold notes how trial lawyers who are unaccustomed to being mediation advocates often miss important opportunities to resolve cases. He discusses several common errors in the mediation process and suggests ways to correct them.
PROBLEM: OMITTING CLIENT PREPARATION. Mr. Arnold urges lawyers to educate their clients about the mediation process and the likely questions and issues, which will be discussed. This includes a discussion of the opposing party’s position.
PROBLEM: FAILURE TO USE ADVOCACY TOOLS EFFECTIVELY. Arnold suggests preparing materials for maximum persuasive impact including exhibits, charts and copies of relevant cases or contracts with key phrases highlighted. Video showing key parts of depositions if straightforward and to the point along with a readable-size copy of an important document with relevant language underlined “can pack a punch”.
PROBLEM: THE BACKWARDS STEP. A party who offered to pay $300,000 before the mediation, but, arrives at mediation willing to offer only $200,000 “ . . . injures its own credibility and engenders back feelings from the other side.” Obviously, a party who offered to accept $200,000 prior to mediation and then demands $300,000 produces the same bad results. “Without some clear and dramatic reasons [for the change in position] it can be hard to overcome the damage done.”
PROBLEM: LACK OF PATIENCE AND PERSEVERANCE. At mediation the negotiation process is described as a “dance” which takes time. Good mediation advocates, according the Mr. Arnold, have patience and perseverance.
PROBLEM: CLOSING TOO FAST. Mr. Arnold suggests a party who opens with a demand of $1 million dollars and moves immediately to $500,000 “ . . . gives the impression of having more the give.” He suggests the other side will not accept the $500,000 offer because they expect more give. He explains, by contrast, moving from $1 million to $800,000 to $700,000 to $625,000 to $580,000, $550,000, etc. sends no message of yielding below $500,000 and may include a $500,000 proposal that can be accepted. Again, if the “dance” is described as part of the communication. “Skip the dance, loose the communication, and risk loosing settlement at your own figure.”
PROBLEM: HURTING, HUMILIATING, THREATENING OR COMMANDING. Arnold admonishes not to poison the well from which you must drink to get a settlement. “You can be strong on what your evidence will be and still be a decent human being. All settlements are based upon trust to some degree. If you anger the other side, they won’t trust you. This inhibits settlement.”
PROBLEM: FAILURE TO IDENTIFY PERCEPTIONS AND MOTIVATIONS. Arnold suggests brainstorming prior to mediation to determine the other party’s motivations and perceptions. He goes so far as to suggest preparing a chart summarizing how your adversary sees the issues. He emphasizes how part of preparing for mediation is to understand your adversary’s perceptions and motivations.
PROBLEM: WRONG MEDIATOR IN THE ROOM. When do the parties need an expert as a mediator? When do they want an evaluative mediator, or someone of relevant technical experience who can engage the parties in meaningful discussion on the merits of the case and alternative settlements? The wrong mediator may fail to get a settlement another mediator might have. “ . . . The wrong mediator may fail to get a settlement another mediator might have finessed.”
PROBLEM: FAILURE TO LISTEN TO THE OTHER SIDE. One of the common errors Arnold emphasizes is how lawyers and clients seem incapable of giving open-minded attention to what the other side is saying.
The authors of this article certainly echo Mr. Arnold’s observations and suggestions. Preparation is a key component for mediation success and lack of preparation is a key component of mediation failure. Failure to discuss the process and issues with your client does a disservice to your client and the process itself. Failure to identify the other side’s perceptions and motivations means you have only done half of your preparation. As Arnold states: “a dispute is a problem to be solved together, not a combat to be won.
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Published 9/2008 in EJCBA Newsletter, The Forum Eight
By: Chester B. Chance and Charles B. Carter
NON-BINDING ARBITRATION: WHO, WHAT, WHEN, WHERE, WHY
Section 44.103, Florida Statutes addresses court ordered, non-binding arbitration. Although there were recent amendments to this statute effective October 2007, Chapter 44 of the Florida Statutes (addressing mediation and non-binding arbitration) has been around a long time (since 1987). It may surprise many to learn that the non-binding arbitration provisions of the statute have existed as long as the mediation provisions, i.e., since 1987. Likewise, Rule 1.700, Florida Rules of Civil Procedure addresses “Rules Common to Mediation and Arbitration”. It has also been around a very long time (since 1988). In fact, Rule 1.700 has always discussed both mediation and non-binding arbitration timeframes. For years attorneys have been familiar with Chapter 44 and Rule 1.700 in the context of mediation although the arbitration provisions have been overlooked.
Therefore, non-binding arbitration is nothing new. It is beginning to be utilized for several reasons.
In addition to mediation, non-binding arbitration is a second form of dispute resolution. Although many if not most cases resolve at mediation, unfortunately some do not for a variety of reasons. The reasons may include lack of preparation by parties or attorneys or unreasonable expectations of one or both parties. Moreover, there is no immediate ramification for the failure to resolve a dispute at mediation.
What kind of cases are most appropriate for non-binding arbitration? Do you have a case with an attorney or a party who is rarely prepared? Lack of preparation may undermine the prospects for success at mediation. Lack of preparation is not a viable option at non-binding arbitration. At arbitration, the facts and issues must be organized and identified. The relief requested and corresponding defenses must be determined and presented. Regrettably, mediation is sometimes used as a form of discovery. In contrast, a party must be prepared in all aspects of the case in order to present the case for non-binding arbitration.
Do you have a client or opposing party who is unrealistic or has unreasonable expectations? A decision by an arbitrator or panel may serve to bring a party down to earth. If you have selected an arbitrator or a panel based on their knowledge and experience, and you have confidence in their decision, how can you logically disregard their decision?
Moreover, if you do disregard the decision, the October 2007 amendments to Section 44.103 Florida Statutes bring some risks, i.e., the same risk inherent in failing to consider a proposal for settlement.
Finally, if mediation is unsuccessful, the parties may be willing to give non-binding arbitration a chance. Perhaps mediation failed because one or both parties were unprepared or unrealistic or because (unlike non-binding arbitration) there was no incentive to give consideration to the outcome.
Thus, non-binding arbitration seems most appropriate to several types of cases: where mediation has been unsuccessful; where a party or an attorney is unprepared and need an incentive for preparation; cases where one or both parties are unrealistic. Although appropriate for any type of case, these cases may be especially suited to non-binding arbitration. Since mediation involves an aspect of compromise, if you strongly believe your client is not liable to the plaintiff, or, if you strongly believe the defendant has no defense to a claim, non-binding arbitration may be a better alternative than mediation.
Why is non-binding arbitration so expensive? The answer: It is not. Mediators in this area charge on average between $225 and $300 per hour. A mediation itself can last four to six hours on average. Presently, many arbitrators in this area voluntarily abide by the optional attorney fee cap for non-binding arbitration set forth in the statute. This rate is less than 80% of the average hourly cost of mediation. An arbitration may take 1-1/2 to 2 hours (anywhere from 25% to 50% the time of an average mediation). Considerations of hourly rates and time mean non-binding arbitration costs much less than a mediation. If fact, the cost of a three-member panel may be equivalent to the cost of an average mediation. Even in complicated or multi-party situations non-binding arbitration will arguably cost less than mediation in the same case. In “small” cases, non-binding arbitration can be extremely cost effective when the overall cost is compared to mediation and in turn compared to the settlement value.
Which comes first: Non-Binding Arbitration or Mediation? Many people think the parties should have a chance to resolve things initially through mediation. However, if the factors described above exist (attorneys or parties unprepared or unrealistic, genuine liability disputes, small case value, etc.) then non-binding arbitration may be your first choice.
In summary, non-binding arbitration has been around as long as mediation in the statutes and rules. Arguably, it is not expensive and can be appropriate for many types of cases.
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When he retired as an area circuit judge, Chester Chance said he was proud of his efforts to make mediation a part of the court system, but disappointed with the lack of progress in reducing the length of court cases.
