“I don’t recommend that people negotiate to the point of wanting to have a mediator’s proposal. Ideally you and your clients are able to control your own negotiations, control your own outcome without needing that, but it's a wonderful tool to be able to be used when appropriate and when necessary.” In this episode, Jean Lawler–commercial + insurance mediator and arbitrator–draws from her experience as a mediator to provide an overview for attorneys of the “mediator’s proposal”. Questions answered during this episode include:
- What is the mediator’s proposal?
- How to use the mediator’s proposal in mediation?
- Should you use the mediator’s proposal in mediation?
To connect with Jean Lawler, follow her on LinkedIn or find her at LawlerADR.com
To read the full episode transcript please see the Podcast Website.
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JEAN LAWLER:
Well, hello. It’s so nice to be here with you today. Welcome to ROADS TO Resolution ~Closure and ~Certainty. I am Jean Lawler, and I’m your host today. I am a mediator, and as a mediator I am honored to be invited into other people’s lives for a few hours. Lives, that like all of our lives, are shaped by the many roads that have brought us to our “today”, roads leading to the unexpected, and roads holding the promises of “tomorrow”.
So, that said. These roads and the leading to the promises of tomorrow…Usually you will see this in a mediation–if someone can resolve a lawsuit, then it frees them up, probably lets them sleep better at night, and lets them get on with the rest of their lives. So that said, the “mediator’s proposal”. This is something that people talk about a lot. It's not necessarily all that well understood. Sometimes people…They think of it, that it's the be-all-end-all.
So let’s talk about the mediator’s proposal. What is it in the first place? Basically, it is a mechanism by which a mediator would provide the parties with a settlement number based on what the mediator believes the case can settle for. The number that’s provided is not a number that is an evaluation of the case, or the liability, or exposure of any particular party. So it's important that the clients know that it is a number that is reflective of the negotiations that have taken place–where the parties are in terms of settlement offers/demand, what the–as I call it–the “dance floor” is looking like at that time, how far apart people are, and based on what the mediator knows from having spoken to the parties, from just intuition and experience.
So what the mediator will do is provide each of the attorneys with a proposed settlement number, a dollar amount number, and maybe some terms that are–generally there would be some terms there as well. And it would be open for them to accept or reject for a certain amount of time. It may be a day or two, it may be a week where people need to go back, they need to talk, they need to do whatever it might be. And then the attorneys who receive the mediator’s proposal, they then respond separately and privately back to the mediator, telling the mediator whether they will accept–their client accepts or rejects the mediator’s proposal.
If both parties accept, then there’s a settlement, and the mediator will let the parties know that. And so then the parties, both counsel, they’ll know that the other one’s accepted. If both parties reject, or if one party rejects, then the mediator tells both parties that there is no settlement, does not say what the other party did or did not do. So if you’re the party that is rejecting it, you will not know if the other side accepted it or rejected it. If you are the party who accepted it, but are told that there is no settlement, then logic would dictate that it was the other side who rejected it, so there is no settlement. But someone who has rejected it will not know what the other side has done. So that’s what a mediator’s proposal is.
So, how to use it? It really needs to be used at the point where negotiations don’t seem like they can continue any further, that you’re really at the “end of the day”, so to speak. They should not be too early. Again, depending on how the negotiations have gone, and both sides need to agree that they would like the mediator to provide them with a mediator’s proposal. And that can break an impasse. There are many ways to break impasses though. This is not the only one. And there are some people who do not like to use mediator’s proposals–both counsel and mediators–who don't like to use them.
So, should you use it? Well, it has its pros and its cons. One is: Depending on how the negotiations have gone, the mediator may be able to successfully peg a number that will make both sides have to stretch, but it's within their realm of stretching–if you will–and they may settle the case and then the case is resolved. On the other hand, a mediator’s proposal–if it's not accepted–it ends the negotiations so many times. There can be discussions, of course, later on, but it's not a sure thing that that’s going to happen. So they need to be used with care, and with caution, actually. I would not just, I don’t recommend that people negotiate to the point of wanting to have a mediator’s proposal. Ideally you and your clients are able to control your own negotiations, control your own outcome without needing that, but it's a wonderful tool to be able to be used when appropriate and when necessary.
So those are my thoughts, and those are some of my comments to you on mediators’ proposals, and all the best to you on that.
Thank you so much for joining me today. It’s my pleasure to be with you. So please follow me on YouTube, ROADS TO Resolution ~Closure and ~Certainty. Follow me, or connect with me on LinkedIn, and my website is LawlerADR.com. Thanks so much. Bye bye.
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