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The Importance of Timing and Preparation for Mediation

January 12, 2016

The most recent civil disputes I’ve mediated involved a division of assets but on the day of the mediation the absence of key information caused a blockage for the parties who were otherwise moving toward their chosen form of settlement.

The discomfort of the lawyers was tangible. How could they advise in a partial evidence vacuum? This is not a criticism of lawyers. They are looking after their client.

Avoiding the costs, time and stress involved in litigation are powerful reasons to mediate early. Until the nineties when new rules led to early disclosure and exchange of information in litigation the parties often didn’t focus until immediately before trial. By then substantial costs had been incurred and the parties were more entrenched than ever. Nevertheless, many settlements occurred  (literally or metaphorically) at the doors of the court building. Why? Because only then had the parties become sufficiently aware of the strengths, weaknesses and risk involved in proceeding.

How can parties settle if key information is not to hand? I suggest that this is where lawyers see danger signs in providing advice (not least, a risk to their PI insurance). Litigation lawyers operate in an adversarial process and require two essential ingredients; law and evidence. They have the law but sometimes at an early stage and at mediation there has been no ( or little)exchange of document and witness evidence.

In some recently mediated estate disputes and shareholder disputes, the parties have sometimes begun a mediation without obtaining independent valuations of the real property. Such valuations do not have to be agreed before mediation but they give a point of reference for the parties and the lawyers. This can help the parties resolve difficult issues such as one party wanting to keep real property and avoid sale and how to figure out how the other’s interest will be bought out. They can consider different structures for a settlement.

I’m pleased to say that the parties’ genuine desires to reach settlement in most cases has meant that even if the settlement has not been reached on the day of mediation they have been able to agree terms of settlement in principle and to record that so that they have settled in full when the  necessary information has been obtained.

My view is that early mediation is still best. Early, it has the potential to avoid the entrenchment, stress and enormous cost involved in litigation. But clearly, mediating early is not without risk and this is where preparation is important.

Parties and their advisers should try to identify issues early and consider what evidence might be required to properly address those issues. It might not be the best evidence at an early stage but some evidence is better than none. Tell the other party what you think are the issues so that they can bring their evidence (or even agree some of  yours). Finally, remember that mediation is not the same as Trial. The parties can decide to settle without the full adversarial testing of evidence.

Written by Keith Hardington – Managing Partner.

For help and advice relating to mediation or any dispute resolution issues, please contact Keith Hardington via or 01756 700200.

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