Mediation

Introduction

Highly popular in the US and the UK, mediation remains seldom utilised and barely known about in many other countries. This is the first in a series of articles offering practical ideas for those considering mediating their disputes.

Companies that have lived through the US litigation system are familiar with jury consultants; those with experience in international arbitration are well aware of the due diligence and analysis that goes into appointing the right arbitrator for the dispute. Having as much input as possible into the identity of the individuals who are going to determine the dispute is just common sense. Despite not ruling on the merits of the dispute, the mediator may have significant influence on the outcome of the case and the mediator’s selection deserves attentive consideration.

What, then, should a party considering a mediation do to place itself in the best possible situation going into the process and, above all, to ensure that the right mediator is appointed for its dispute? Three basic rules apply.

Consider the profile of the mediator as it relates to the dispute

First, the party needs to consider exactly what type of mediator it wants for the case. Parties with limited experience in international mediation often overlook the two broad categories or types of mediator who render services in international matters.

Broadly speaking, mediators can be brokers (that is, skilled individuals who help bring the parties together irrespective of who is right and who is wrong) or neutral evaluators (that is, experienced litigators and case adjudicators who, upon summary information, can tell a party the strengths and weaknesses of its case and the advantages and disadvantages of settling it in a certain way). A small minority of experienced mediators can do both things (broker an arrangement after neutrally evaluating the case), but most mediators tend to be either predominantly brokers or predominantly case evaluators. This is a significant distinction the parties need to be aware of so that they can shape their strategy accordingly.

An experienced broker can help the parties reach a settlement, but typically will not be of benefit to a party convinced that it is absolutely right in every claim and that it is not worth making any significant concession or giving away any rights in exchange for a prompt resolution. A good case evaluator, by contrast, may give the parties an honest and trustworthy opinion on their case but lack the negotiation skills to bring the parties closer together. However, in disputes that often have international arbitration as the final method of dispute resolution, it can be difficult to assess how the arbitration tribunal will rule. By comparison with domestic disputes, international arbitration rulings tend to be more difficult to predict owing to the different legal systems, cultural backgrounds and natures of the parties and arbitrators involved.

This is where time spent in researching the background and levels of previous experience of the international mediator is most valuable. Before offering any names to the other side, or replying to any offer to have a certain person appointed as a mediator, the party should consider whether it predominantly needs a broker or a case evaluator, and then identify only names and profiles of candidates who fall into the desired category.

Understand how the appointment will take place and exercise your rights

Second, it is necessary to be fully cognisant of the mechanism that will be followed for the appointment of the mediator. Typically, the mediator will be the person the parties agree on. But party agreement seldom occurs – and when it does not, it will fall to a judge, the mediation-administering institution or a third-party nominating authority to appoint the mediator. Not all of them will approach the appointment of the mediator in the same fashion, and the parties need to recognise what mechanisms, rules, principles and motivations each of them may follow, for these may vary significantly. Where parties cannot agree on a specific individual, they should at least seek to agree on the mediator’s basic profile.

If the parties, despite their best efforts, are unable to agree on a type of mediator, the party will then need to consider whether it can or should explain to the appointing authority orally or in writing what criteria it considers the mediator should meet. A submission in this vein should be attempted if it is allowed. Its advantages are obvious. With it, a party can make the appointing authority aware of any significant qualifications the mediator should have, such as language proficiency, legal background, area of residency, years of experience or industry expertise. However, there is usually no guarantee that the appointing authority will take these issues into consideration (especially if the parties are not in agreement on the issues).

Another key decision for the party is whether to offer the appointing authority some specific names of suitable candidates. No one-size-fits-all solution exists here. On many occasions, the fact that a certain name has been offered by a party may be enough incentive for the other party to reject it, thus delaying the process. Also, the more names that are considered and discarded before the institution makes an appointment, the smaller the pool of candidates that the institution can eventually choose from. Thus, if a party has a significant desire that a certain candidate be appointed, it may be better to refrain from offering the name to the institution and to the other party straightaway (thus avoiding the risk of the name being ‘burnt’). Instead the party should simply limit itself to requesting that the mediator eventually appointed fit a profile compatible with that of the party’s desired candidate.

The next question the party needs to ask itself is what procedure is to be followed to appoint the mediator. Certain institutions, such as the ICDR, CPR or JAMS, have mediation rosters from which the mediator, in the absence of party agreement, is ultimately appointed. Parties are advised to become familiar with the candidates on the roster, consider whether there is anyone listed they would prefer to see appointed, and try to anticipate which of the roster members would appear best equipped to resolve the dispute. Not all institutions, however, appoint mediators from a pre-existing roster. The ICC, for instance, does not.

Additionally, it helps to know whether the institution making the appointment will follow the ‘list method’ to appoint the mediator. As a general rule, the ICDR, CPR and JAMS follow this practice, meaning that, where there is no party agreement, the parties receive a short-list of candidates selected from the institution’s panel of mediators. The parties can then strike and rank those candidates in the list, in such a way that the most highly ranked by both will receive the appointment. If no common candidate emerges, the institution can appoint someone directly from its panel of mediators.

(By contrast, in its mediations, the ICC can dispense with the list mechanism if it considers this to be warranted and appoint the mediator directly.)

The list system can often lead to the appointment of someone other than a party’s preferred candidate, but it still gives the party a say in the identity of the appointee, an opportunity not afforded by a direct institutional appointment in which no candidate names are provided.

Be strategic

Third, the party must approach the mediator appointment process with realistic expectations, a flexible attitude and as much information as possible. It is always unrealistic to have just one mediator candidate and to stick with that name through thick and thin – the odds are that the other party will not agree to that candidate. It is always wise to identify in advance a number of candidates with whom the party would be comfortable.

Also, the mediator obviously needs to be independent and impartial; efforts to appoint a mediator who undoubtedly would not survive a challenge are usually nothing but a waste of time.

As part of the effort to identify qualified mediators, a party and its counsel should not hesitate to draw from their own experience, talk to colleagues and peers, and review publicly available information about the mediator – articles, prior rulings (if the mediator candidate comes from the bench or has issued public arbitral awards) etc. Also, many mediator candidates have published CVs that indicate what type of mediation they prefer (brokered or case evaluation) and the protocols that person’s mediations tend to follow.

Some mediators prefer protracted mediations, with written submissions and oral presentations, while others merely summon the parties to a joint session where the case is presented to the mediator for the first time.

Different cases call for different types of mediator; therefore parties are well advised to do as much research as possible to determine whether the candidate they are considering is indeed the person they need for this particular matter.

A question that frequently arises in practice is whether mediator candidates can be interviewed prior to their appointment. Because most cases are mediated by just one mediator as opposed to three, the answer is typically that mediator candidates are not usually comfortable being interviewed unless both parties are present, and even then the mediator should usually, and generally will, refrain from addressing the merits of the case during the interview. One issue, however, that parties – or the appointing institution, if need be – should try to discuss with any mediator candidate is the timeframe of the mediation. (How busy is the mediator? When can a mediation session realistically take place?)

Lastly, it is important to remember that, to a degree largely unknown in court litigation and in arbitration, the effectiveness of a mediation is strongly influenced by the mediator’s personal touch, personality and even charm. A good mediator can convince parties who are worlds apart to settle a dispute if the mediator shows them that settling is in their best interest. In other words, as part of any due diligence on mediator candidates, it is always useful to consider the mediator’s personal style and ability to create consensus in the mediation session.

Selection and timing

Significant time, money, and effort can be saved by the appointment of an effective mediator. Yet, choosing the right mediator requires a good understanding of one’s own case, analysis, due diligence, strategy and even persuasion. It is not a decision that can be rushed, and it is one that should ideally be prepared before the mediation is even proposed, let alone commenced.