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By Jeffrey L. Marcus*
Introduction:
With the continuing rise in litigation costs, coupled with the
length of time it takes to fully litigate most complex disputes, mediation provides an effective
alternative mechanism for dispute resolution. While many types of alternative dispute resolution
techniques are available (ie., arbitration and special referees), mediation offers the most
flexibility for the resolution of complex disputes.
What is Mediation:
Generally, mediation is a voluntary and confidential process
through which a third-party neutral or intermediary, usually selected by the parties, facilitates
a settlement between or among parties to the dispute. The parties to the mediation control the
outcome. Unlike court trials or arbitration, no one imposes a solution on a party. Simply stated,
if all of the parties do not agree to the result, the dispute remains unresolved and litigation
moves forward.
Contractual Mediation:
As with other forms of alternative dispute resolution,
mediation may be a contractual deal point. After a dispute arises, the contractual mediation
clause is triggered and mediation takes place, usually prior to the commencement of expensive and
protracted litigation. Of course, mediation may also be utilized absent a contractual deal point
provided the parties agree to the process.
Successful Mediation:
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Best time to mediate. Except when there is a contractual mediation clause which dictates
the time to mediate, mediation should take place as early as possible so that valuable time and
money is not wasted. However, not all disputes can be effectively mediated when the parties are
not sufficiently informed of the points and counter points to the claims or defenses that are at
issue. It is sometimes necessary to conduct focused discovery, investigation and legal analysis
so the parties and mediator can be properly informed.
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Select a strong and effective mediator. The goal is to find someone who can talk effectively to
both sides and have enough insight, as well as compassion, to be able to understand and resolve
the dispute. The mediator needs to have prior experience mediating the types of issues in your
case. Both sides need to respect the opinions of the mediator. In my experience, retired judges
and justices garner the most respect and are the most effective mediators.
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Mediate with a goal to resolve the dispute. Be familiar with the claims and defenses in issue
and listen to the other sides' position.
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Creative settlements make successful mediations. Plaintiff’s goal is to get as much money as
possible, while defendant’s goal is to spend as little as possible. In order to bridge the gap,
consider creative alternatives, ie., have settlement monies paid in installments over a period of
time. If necessary, the terms of the payment schedule can be secured by an executed stipulated
judgment. Also, one may offer non-economic terms in lieu of settlement monies.
Conclusion:
Recently, more and more business entities and individuals are
turning to mediation to resolve their differences. Certainly, mediation is an additional cost
component to litigation. However, once the litigation has commenced, and the parties have solidified
their understanding of each other’s positions, it can be a cost effective means to resolve litigation.
Mediation does not always work, however, when a case settles, everyone benefits. One of the best
things about settlement is everyone earns the ability to move on.
This newsletter is published for the interest of friends, clients and prospective clients of the
Law Offices of Jeffrey L. Marcus and should not be relied upon or considered as legal advice.
*Jeffrey L. Marcus, Esq. provides litigation services and transactional advice to the firm’s clients.
He has more than 14 years’ experience in private and corporate practices involving business transactions
and real estate. Mr. Marcus can be contacted at
jeff@marcuslawgroup.com or at the
above address/telephone number.
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