Tricks Of The Trade – Part 1 – Problems v. Issues

By Dov Silberman

Every trade and profession has their own tricks of their trade, and mediation is no exception.

I hope to present occasional pieces to give you some insight into what practices a mediator can bring into play to facilitate two or more arguing disputants to look at their problem differently so as to come up with a solution themselves.

I also want to show you that mediation is different from just sitting two people (and their advisors) down and chairing what would be otherwise called, a round-table conference.

To get the ball rolling, I made a deliberate error in describing above what I hope to achieve. I used the word “problem”.  That word is a no-no.   In mediation-speak, we never use the word “problem”.  People do not have problems, they have “issues”.

The reason for that is clear. We are here to solve something that has brought two people into conflict. Very rarely is one person absolutely wrong, and the other absolutely right. Indeed, very often, without any moral blame by any or all of the participants, an unforeseen and unavoidable event created the current set of circumstances.

A problem is negative. It implies that there is something wrong that needs to be fixed, something we don’t want, something we want to go away.  We get hung up on moral judgements, our own self – righteousness, and the evilness of the other side.

But it doesn’t help to find a solution if the other side feels exactly the same about us as we feel about them.

An issue is an independent topic, something that has different valid aspects and not an integral part of the participants’ lives.  It has much less emotional connotations, and allows the participants in a dialogue to seek a constructive answer to resolve it.  An issue sounds so much smaller and much less threatening than a problem.

How people deal with a situation depends whether they view it as  a problem or as an issue.

Mediators try to take the “heat” out of disputes by framing the disputes to facilitate solutions.

Also on what I said at the beginning, we should point out that round table conferences are usually not held at round tables.  Most offices have rectangular shaped conference tables.  It is natural that each side will gravitate to opposite sides of the table, leaving the neutral mediator at the head.  This has the effect of not only demarcating the parties and emphasising their differences, but can easily lead to each party metaphorically shouting directly across at each other. Think of how long people have been at the bargaining tables at the Demilitarized Zone in Korea.

Korea DMZ Sentry

A South Korean sentry near the demilitarized zone (Imjingang). Photo by Johannes Barre

It is also difficult for one party when speaking to address both the other side and the mediator simultaneously by facing both at the same time. You have to face one, and move your face about 45° to face the other.

Try it at home around the (rectangular) dinner table.

Yet by considering the persons (such as parties and advisors) turning up and by skilfully using the type of table available  –  better still if it can be custom provided for the occasion required – Square, Rectangular, Round, Oval, and even Triangular –  at the beginning or during the mediation, the mediator can set the tone for the discussions, or modify it later.

In my next post on this topic, I hope to expand on tables and seating arrangements, and how they can facilitate discussions between the parties.

What Is Med-Arb?

By Dov Silberman

Mediation – Arbitration, or “Med-Arb” for short, is a process by which section 27D of the various state Commercial Arbitration Acts allow for an arbitration to turn into a mediation, or for a mediation to turn into an arbitration.

As I have pointed out before, current judicial thinking is to turn away from viewing the litigation process as a cut and dried impersonal dispute solving mechanism to one facilitating a dispute resolution system.

One proposed method is where the parties can utilise two common forms of dispute resolution procedures, mediation and arbitration, each with its unique advantages, using the same person as both the mediator and the arbitrator.

If the process started with a mediation and is unsuccessful,  then you save time and money by having the one person already familiar with the issues and personalities ready to adjudicate immediately.

If the process started with an arbitration, then if during the proceedings, it appears that a mediation is called for so that the parties can settle their conflict themselves (the most desired outcome), then you have someone who knows the  issues and personalities ready to start mediating right away  –   to strike while the iron is hot, so to speak.

However, with all the good intentions in the world, there are at least two major problems with this, both concerned with natural justice:

  • A major reason for success in a mediation is because a mediator engages in private discussions with each party to find out what their real issues, desires and needs are, and to see if s/he can facilitate an open discussion based on these confidential revelations. However, if the parties know that the mediator may become an arbitrator, then they will be less than frank about revealing their real position, or what their weaknesses are,  or their bottom line, or their views of the other party or the other party’s actions, for fear that the mediator turned arbitrator may even unconsciously use it against them later on.   Further, natural justice requires that a party must be able to answer all allegations made against it in the presence of the other party.  But private and confidential sessions negate that.
  • If the mediator lets slip their view of a particular aspect, or even if s/he says that the other party appears to have a point without even saying how strong that point is,  then the arbitrator could not only appear compromised as indicating a view on the issue, but also that there would be a claim of undue pressure to settle. Natural justice requires that a decision maker be unbiased. A mediator is not a decision maker, so this aspect does not arise. But if a mediator becomes an arbitrator, then in such a case, which is more than likely to arise, there would definitely be a perception of bias.

Section 27D(4) of the Act attempts to deal with these issues by insisting that  the parties consent in writing before the arbitration continues.  This means the parties cannot thereafter complain just because the arbitrator acted as a mediator.  Any party can consider what was done at the mediation, and if there are any concerns, they simply do not agree to continue the arbitration.

Nevertheless, this does not cure the evils discussed, quite apart from the extra time and money now required to appoint a new arbitrator.  If a party has been openly honest in private discussions and painted itself in an unfavourable light, or revealed certain unfavourable elements, then the obvious position it should take is to refuse to allow the arbitrator to continue.  This course of action effectively emasculates the whole procedure.

Not only that, but because each party will not know what the other party has told the arbitrator privately, it cannot know if there could be an element of bias which needs to  be addressed, or some allegation which may not come out in public later and which could unconsciously affect the arbitrator’s neutrality. The obvious course of action is likewise to refuse permission for the arbitrator to continue, but that also effectively stifles the whole process.

Section 27D(7) attempts to cure these problems.  The arbitrator must disclose to the other party “so much of the information as the arbitrator considers material to the arbitration proceedings”.

But this places the mediator/arbitrator in an unenviable position.  For this to work to obviate the problems above, the information must be given before the parties consent, so they can make up their minds to agree, else the appropriate decision is to withhold consent.

But the mediator is now revealing confidential information (and query how much is appropriate) to the other side, who can then say, “thank you very much for that”, and refuse to continue with the arbitration just then, having gained a huge advantage of knowing such confidential formation.  The whole exercise has been one large scale fishing expedition, with outcomes worse than a regular mediation, where confidential information should never be disclosed.

This does not mean that med-arb is never suitable.  There will be cases where these problems will not occur, and it will be useful then.  For example, where the parties can by themselves, with the assistance of a mediator,  maintain their ongoing business relationship, and only require an arbitration on a very specific aspect e.g. the quantum to be paid, without adjudicating on the rights and wrongs of the case.

Confidentiality – a real case in Melbourne why it is so important

By Dov Silberman

The Age this morning ran a report about a racist incident involving two under 15’s football clubs.

Reservoir Colts captain Mohammed AWO, of Somalian heritage,  claimed he was racially taunted and assaulted by his opponents team, Hurstbridge, players and officials.

It was reported that  Northern Football League (NFL) “chief executive Jeremy Bourke confirmed Hurstbridge made ‘some admissions’ of guilt at a mediation session in June 2011.”

That was 2 years ago!

If correct, then such comments by anyone, let alone a chief executive of a sporting association, cause concern for the integrity of any mediation process.

What is said at a mediation must remain confidential so that parties can freely talk and put their cards on the table in order that the real issues can be openly dealt with, without fear of compromising their legal rights or exposing themselves to ridicule should the mediation fail.

In many cases, and I suspect that this is the case here, one of the parties wants to hear a heartfelt apology and a strong and genuine commitment that steps will be taken to educate the young players about what is and what is not acceptable.  I also suspect that the other party (or the adults at least) are genuinely mortified by what has happened and do want to ensure that their team will be able to play without such a stigma hanging over them.

But mediations are not always successful.  I hope that Hurstbridge will be confident enough to participate in the planned mediation without fear that what they may say will not come back to haunt them, not only now, but in years to come.

Why Mediate – part 2 – What’s right with mediation.

By Dov Silberman
The advantages of mediation are also well known and documented:

  1. Prior negotiations have failed. Negotiations will already have been attempted by the parties or their lawyers, including maybe round table conferences.  For various reasons, they were unsuccessful.  An independent mediator, a different process of discussion and private sessions during the mediation, can overcome the inherent problems of normal negotiations such as trust, secrecy, giving away your case etc.
  2. You control the flow of information. You can say things to the mediator which the other party will not hear. You control what is said and revealed to the other side. Whatever is said or revealed cannot be used in court.
  3. You get a chance to say what you feel. You can say what you feel in a safe and non-threatening environment.  A skilled mediator will allow you, and the other side, to  release personal feelings in a way that leads to resolution, rather than escalation, of the conflict.  The other side will, often for the first time, really internalise where you are coming from.
  4. The real issues will emerge. A skilled mediator will uncover the real issues of the dispute, which are often non- legal and non-monetary.
  5. Mediation is innovative. It focuses your attention and energy on coming to grips with the real problems of the dispute.  The more information, not necessarily legal, on the table, the better the  settlement prospects.  It encourages you to negotiate creative and  acceptable solutions and agreements not normally found within the litigation process.
  6. You are in control of the process and outcome. You go through the mediation at your own pace.  You and the other side are always on the same page. Both of you ultimately are in control, not only of the outcome, but also the process, so you have to be emotionally comfortable with how it advances. That is why prior arrangements are made so each party is comfortable with the setting, time etc. The mediator does not impose, or even suggest, settlement terms.
  7. Cheapness and cost effectiveness:-
    • Mediation is designed to be short (half to a day)
    • Mediation promotes an early resolution
    • Your litigation expenses, business disruption and emotional traumas are dramatically reduced.
  8. Additional benefits. If appropriate, your valuable business and personal relationships can be preserved or enhanced by skilful mediators.
  9. Mediation is low risk. You can voluntarily accept or reject any settlement. The mediator does not impose, or even suggest, settlement terms.
  10. Preparation for the future. If all else fails, you can still go to court. If the case  does not settle now, then you should know why it hasn’t settled, what the likely future costs will be, and can plan for court and outcomes accordingly

Why Mediate – part 1 – What’s wrong with litigation?

By Dov Silberman

Why does the government and courts want you to mediate?

You are in, or can see yourself getting into, a legal dispute.

The other side is obstinate and pigheaded, completely wrong, and refuses to see that you are right.  You cannot stand the sight of the other person who makes you sick just thinking about him/her, let alone facing that other person.  If you are both in the same room, then you’ll just at the best, get into a slanging match.

Better just to let the justice system take its route, and have a judge decide.

Well, I have news for you – the legal system nowadays forces you to engage in some form of mediation prior to hearing the case.  Only in a few sorts of cases, mainly where the time and  costs of a mediation is not proportionate to the amount of the money in dispute, will a court or tribunal not insist on mediation.

There is one practical reason and one social reason why the government and judges want mediated settlements rather than court imposed judgements in commercial and matrimonial disputes:-

  1. The court’s resources (ie the taxpayer’s dollars) are saved – the government can spend the money on other things. Research around the world and in Victoria (including the seminal 2009 256 page report into Mediation in the Supreme and County Courts of Victoria) show that a huge majority (77- 85%) of cases referred to mediation settle.  Time and resources can now be more effectively utilised
  2. Mediation helps repair the social and inter-personal fabric that has been damaged and torn apart by conflict.  Preserving social cohesiveness is one of the primary purposes of a democratic government. Both parties (taxpayers and their extended contacts – family and friends) ultimately are unhappy with court imposed orders – Justice is a very blunt instrument to solve a dispute. The judge will usually have to award 100% to one side, even if the other side has some valid reasons for acting the way it did.  Thus there will be at least one side that will still be unsatisfied with the decision (leading to the distinct possibility of appeals – thereby incurring more costs and not allowing closure), and the other side will have lost out in unrecovered time, emotional costs, and non-recoverable legal fees.

The disadvantages of litigation are well known and documented:-

  1. Financial Costs.  The huge pre-trial and trial legal costs;
  2. Time. The time it takes to get to trial – years in many instances;
  3. Publicity. The lack of confidentiality, and its sidekick, publicity, during the trial and judgement;
  4. The outcome. The decision is left to a third party, whom you may feel does not fully appreciate your position;
  5. Rules of evidence. Rules of evidence may exclude or limit many things that you think are important;
  6. Loss of control. You personally have little or no say in the process of getting to trial, which can be frustrating to a non-lawyer, or someone not used to the court system; and
  7. Other costs to you. There are huge costs in time, emotions, non-recoverable legal costs and the inevitable diversion of your focus from other parts of your life/business

I will enumerate the advantages of mediation, also in point form, in the next post.