There has been a marked shift in the past twenty years to facilitate settlement through Alternative Dispute Resolution (ADR). Mediation or facilitation (used interchangeably here) is a non-binding form of ADR as opposed to arbitration, which is fully binding and case evaluation, which is quasi-binding.

Since so many cases are settled ahead of time or even referred to mediation, it is important for attorneys to investigate the background of mediators and select one who is qualified to handle the type of case being facilitated.

What kind of mediators are there? These are the typical varieties:

1. The retired judge. Nearly every retired judge becomes a mediator and many of them are very effective. However, most of these mediators have not been formally trained – rather, they use their status as a retired judge to establish a rapport with the parties and coax them into settlement.
2. Formally trained attorney mediators. Many attorneys have spent years refining the art of facilitation. They have likely gone through the training offered by the American Arbitration Association or ICLE and possess certifications from these organizations.
3. Untrained but experienced attorney mediators. Many of these mediators are very effective, especially if they are practitioners in the area of law that the case involves. For example, construction lien cases involve very unique issues of mortgage and lien priority which are implicated by extensive statutory and common law. Only certain mediators are qualified to handle complex construction lien cases and many of them are neither former judges nor certified by an association.

How much do mediators cost?

Different mediators have different fees. Your costs will depend largely on the complexity of your case, the level of experience and knowledge that you believe a mediator will need to have, and how lengthy the mediation will be.

You will likely not need a powerhouse mediator that charges $400 per hour to settle your $15,000 District Court collection action. Rather, all you probably need to do is get the parties together in a couple of conference rooms and send numbers back and forth. There are plenty of inexpensive mediators that may not fall within the above categories but will serve the purpose of settling your smaller case.

A warning (from experience): Selecting the wrong type of mediator just to save a few bucks or for other less important reasons is a bad idea. If you agree to a mediator to help facilitate the resolution of a commercial contract dispute and you find an affordable mediator, but one who primarily has experience in personal injury law, the process may not be as effective or efficient and may actually cost you more money and time.

Typically during the status conference of a case, the judge will distribute a list of recommended mediators to the attorneys. When I receive this list, I sit down with the opposing counsel and identify three mediators that we both recognize and are willing to pursue. I then consult with other trusted attorneys to find out about their experiences with the identified mediators.

After I have properly researched and investigated the mediators, I meet with my client regarding the mediators’ fees and my recommendations.

Mediation is used so frequently that it is in everybody’s best interest to engage the right person to mediate your case, one who is fair, knowledgeable, and effective.

By Adam Kutinsky, Member, Dawda, Mann, Mulcahy & Sadler, PLC

The post Choosing the Best Mediator for Your Case appeared first on Dawda PLC.

The legal profession’s push to facilitate (nearly every case filed in Michigan’s state circuit court is not only assigned to case evaluation under Michigan Court Rules 2.403, but frequently ordered to facilitation) has had some negative consequences. These have included:

• Additional fees and costs associated with facilitation if the case is not appropriate for facilitation.
• Loss of trial skills among young lawyers.
• An abridged timeline for preparation. The business court docket now requires early facilitation for all cases within 90 days of the first court conference (local administrative orders). This means that as soon as you file your lawsuit, the Court calls the parties in for a scheduling conference and orders the case to facilitation before any significant discovery has been taken place.

Mediation and facilitation should be distinguished from case evaluation and arbitration. Case evaluation is mandatory for all lawsuits other than those that are only equitable in nature. Case evaluation is governed by the Michigan Court Rules and is only binding when all parties to the evaluation process “accept” the evaluation award. If any party “rejects” the award, the case proceeds to trial as normal.

There is a risk of sanctions in rejecting an award in the form of attorney fees and costs from the date of rejection through verdict. Conversely, arbitration is a binding ADR proceeding conducted like a bench trial, but not governed by evidentiary rules. Rather, either a single arbitrator or panel of arbitrators presides over the proceedings and makes decisions concerning admissibility of evidence, usually under the American Arbitration Association rules. The arbitration award is then entered as a judgment following the proceedings.

Why Choose Mediation?

Each case is different; not every case is appropriate for mediation. Timing is also important to consider. The business docket for example orders every case to early facilitation, which means that the parties are engaged in ADR before significant discovery has been conducted. This can be very ineffective because parties tend to be entrenched in their positions early on in cases, because discovery has not yet revealed weaknesses in their case.

Nevertheless, small business disputes, such as commercial collection actions, can benefit greatly from early facilitation.  This is is because small disputes typically involve parties that are reasonably concerned about excessive attorney fees, the bulk of which are incurred during the discovery period.  Additionally, in small disputes, the economic damages are more easily measurable without extensive discovery.

On the other hand, I do not recommend submitting a case to early facilitation where the parties lack the details necessary to make a reasonable settlement offer or demand. In other words, if you require discovery to understand the range of economic damages or validity of the opposing parties’ defenses, it makes no sense to submit the case to facilitation early on in the lawsuit. Since facilitation is much more time consuming than case evaluation, an ineffective mediation session can anger a client since he is not only spending his time away from work and paying your fees, but he is also paying for the facilitator.

When called into the judge’s chambers and asked whether early facilitation is appropriate, do not hesitate to say no if the case requires discovery before facilitation can be effective. In my experience, facilitation after discovery is much more effective in nearly every case, since by that time the parties possess sufficient information to evaluate the strengths and weaknesses of their cases.

Another benefit of facilitation is that you can use it to avoid case evaluation. Case evaluation can be frustrating, requiring the attorney to summarize a complex dispute in five minutes for three mediators who have a large docket to get through on that day.  So, usually when the judge asks whether facilitation is warranted, I will ask that as part of the order to facilitate, he remove the case from case evaluation.

In future posts, I will discuss choosing the right mediator, preparing your client for mediation and drafting a mediation summary.

By Adam Kutinsky, Member, Dawda, Mann, Mulcahy & Sadler, PLC

The post Mediation: What is It and When Should it be Utilized? appeared first on Dawda PLC.