Mediation as used in the state and federal courts is a form of alternative dispute resolution (ADR), and a way of resolving disputes between two or more parties who are stuck litigating a court case. Typically, a third party, the mediator, assists the parties to negotiate a settlement. Parties can mediate disputes between landlord and tenant, between building contractor and building owner, between insured and insurance company, or between feuding investment partners who own an interest in an apartment building.
The term “mediation” broadly refers to any instance in which a third party helps others reach agreement. More specifically, mediation has a structure, timetable and dynamics that “ordinary” negotiation lacks. The process is private and confidential, possibly enforced by law. Participation is typically voluntary, although a Court has the power to order parties to participate in mediation with a specific deadline. The mediator acts as a neutral third party and facilitates rather than directs the process. Mediation is becoming a more peaceful and internationally accepted solution in order to end conflict. Mediation can be used to resolve disputes of any magnitude.
My vast experience with mediation begs the question- what is the key factor that can make formal mediation successful in contested business or real estate damages cases?
In other words, when is mediation a good use of time and money? Here are the factors you should consider to determine whether the mediation will be successful at the end of the day. These are all important legal considerations that are thrown into the murky stew of the mediation recipe, and can impact the process and determine whether the mediation will be successful, or will be a starting point, or whether it will be a waste of time and money at this juncture in the case.
- How effective is the mediator at understanding the issues in the case and persuading parties to step up to the plate to settle the case?
- Can the settlement agreement be put in writing with all terms promptly?
- Will the parties voluntarily sign a written settlement agreement with all terms?
- Will the settlement require complex performance obligations over time – who will monitor compliance with these obligations?
- Will compliance with the settlement agreement require enforcement under Cal. C.C.P. Section 664.6 if one party fails to comply with the terms- so the Court can retain jurisdiction to enforce the terms of the settlement after the case is dismissed?
- Who will bear costs of litigation- or does each party bear their own costs?
- Do the opposing parties have personal animosity or hatred and emotional barriers that are blocking the lines of communication?
- Is there an attorney with an ego problem who is getting in the way of the settlement by wanting to drag out the litigation or by not communicating well with opposing counsel?
- Is the mediator unethical, and wanting to drag out the mediation to earn a larger fee?
- Is the mediator conducting the mediation in an inefficient manner, and trying to rack up fees by talking endlessly chatting with the attorneys and the parties in their respective camps about irrelevant points.
- Are the parties completing mediation in good faith to settle the case, or is the mediation process a bluff and just a means to learn certain facts outside of formal discovery channels?
- Are the parties fed up with the case, and want to reach a settlement and stop the litigation costs?
- Has one party filed a Motion for Summary Judgment?
- Has a summary judgment motion been denied?
- Has one party noticed key depositions as a hammer in the case?
- Is the trial date approaching?
- How good are the expert witness opinions?
The author, Nate Bernstein, Esq., is the Managing Counsel of the LA Real Estate Law Group, a Los Angeles based real estate and business law firm. You can contact Nate at (818) 383-5759 or visit www.larealestatelawgroup.com. The firm serves clients throughout Southern and Northern California. Nate Bernstein is a 22 year veteran Los Angeles real estate and business attorney, transaction and trial lawyer. Mr. Bernstein also has expertise on bankruptcy law, the federal bankruptcy court system, creditor’s rights, and debtor’s bankruptcy options. He previously served as Vice President and In House trial counsel at Fidelity Title Insurance Company, a Fortune 500 company, and in house counsel at Denley Investment Management Company, a large privately held company. Nate Bernstein created www.laquiettitleattorney.com, a leading educational resource on quiet title real estate litigation. Nate has personally litigated more than 40 real estate trials, and has settled more than 200 complex real estate and business cases.