VOLUME 11, ISSUE 4: ARTICLE SUMMARY
Mediation: The “New Arbitration”
By Jacqueline Nolan-Haley
Summary by Elisabeth McClear
Originally published by the Harvard Negotiation Law Review
Read the full article here.
Mediation, once serving as a “refuge from the courts,” has taken on the characteristics of arbitration. More frequent involvement of lawyers and the increasingly evaluative, even adjudicative, role assumed by many mediators formalizes and adds theater to a process that once offered flexibility and self-determination as an alternative to the melodrama and rigidity of the traditional justice system. This corrupted example of the process is “legal mediation.” Arbitration is, in turn, serving as a stunt-double to litigation in a systemic ratcheting of the venue-forms of ADR that limits the options available to parties in dispute without retaining any of the original benefits inherent in mediation: to wit, the opportunity to experience individualized justice as an alternative to formal litigation.
Mediation now stands at a crossroads. The legal community must decide whether to allow this evolution to continue or attempt to restore the process to its first-principles. In the sections outlined below, this article analyzes the history of these changes and advocates the latter option.
II. THE MEDIATION PREFERENCE
While, historically, arbitration has been the most commonly selected alternative to direct litigation, its popularity has been on the wane. This has allowed other forms of ADR, most notably mediation, to flourish in its place. The cost burdens on disputants in arbitration have risen as the process has assumed many of the formal trappings of trial; e.g., a full discovery phase, witness testimony, etc. At the same time, these apparatuses have also served to make the ordeal more time consuming for all parties. Cases that begin in arbitration also often end in court as some jurisdictions maintain expanded grounds authorizing the appeal and vacatur of arbitration awards. Consumers and employees, meanwhile, are increasingly skeptical of the process as almost uniform reliance on adhesion contracts in business and service agreements funnel justiciable claims into arbitration while barring class formation. In some cases, parties are beginning to favor settling their claims in court, but, for many, mediation has come to fill the void.
Mediation has relied on the core principles of “self-determination” and “party participation” as its chief value-adding mechanisms. Its voluntary nature enhances the parties’ ability to engage in constructive problem-solving, freeing them of the need to ply advantage or overstate their positions. The outcomes it produces are generally more conciliatory than vindicatory. Mediation fosters forgiveness and peace of mind and parties exiting a successful mediation often do so with a greater feeling of empowerment and recognition than they may have had if their dispute had been resolved in the more formalistic and directive venue of a courtroom. This benefit derives from the tendency of mediation to provide a forum that permits a greater degree of self-expression or “voice” than does a strictly judicial setting. This can be very therapeutic to parties in dispute. Without the burden of the civil rules of evidence, parties may present their narrative without interference and walk away feeling as though their view of the matter was properly aired.
These attributes, coupled with the benefits of cost-efficiency, likelihood of compliance (when parties have helped to shape the resolution of a dispute they are more likely to abide by it), and the confidentiality and ethical protections of mediation proceedings, have helped to spur the expansion of the mediation model as an alternative to litigation. Today, mediation has supplanted arbitration as the most commonly selected ADR model in the United States at both the state and federal levels.
Mediation’s ascendancy has also extended to international settings. The UN Committee on International Trade, the World Trade Organization, and the World Intellectual Property Organization have all adopted policies and processes featuring, and even favoring, mediation as a viable method of dispute resolution. Many international organizations, notably the International Institute for Conflict Prevention and Resolution and the European Commission, have also adopted mediation codes of ethics to further standardize and integrate the process with existing dispute resolution mechanisms.
Additionally, in response to the waning popularity of arbitration and the growing sentiment favoring mediation, some international arbitral authorities have begun offering mediation alongside their arbitration services. The Center for Effective Dispute Resolution, an international arbitral authority, has even gone so far as to direct its arbitrators to insert into their proceedings a “mediation window,” during which parties may opt into mediation as a method to resolve their dispute before the arbitration is fully underway, and also directing them to penalize in their awards parties who refuse this opportunity.
III. LEGAL MEDIATION MOVES TOWARD AN ARBITRATION MODEL
While gaining in popularity, mediation has not remained true to its roots as a process aimed at creating a voluntary, confidential, and non-adversarial alternative to direct civil litigation. On each of those points, the new “legal mediation” has begun to undermine the mandate of the dispute resolution system that spawned it. This is particularly so in non-family court-annexed mediation scenarios, where the whole process takes on an air of compulsoriness and the parties have no interest in maintaining continuing relationships post-mediation of the kind that incentivize cooperation in family and more voluntary settings.
The impact of legal representation in mediation is equally undermining in this regard, as lawyers are not so much interested in bringing parties together to work constructively towards mutually agreeable solutions as they are in zealously representing their clients and in the efficient resolution of disputes. They can also make it more difficult to separate the “interests” of the parties from their “positions,” as lawyers will tend to focus on the latter as applies to their client. This tendency also leads many to approach the process with the same degree of formality as an arbitration proceeding, frequently submitting position-briefs based on points of law, rather than aiding in the shared search for equity and conciliation that the mediation process invites and encourages.
The author conducted a survey of mediators in the greater New York area, asking them to describe how often lawyers representing participants considered a number of factors in their submissions during the pre-mediation phase. The factors were: “(A) the client’s interests and needs; (B) the opponent’s interests and needs; (C) potential solutions other than money; (D) submitter’s perceptions of their litigation strengths and weaknesses and (E) barriers to settlement.” Perhaps unsurprisingly, while the study found a “problem-solving approach” evidenced in the responses to most of those factors, only 29% admitted to considering factor (B), the opponent’s interests and needs, in preparing their submissions, indicating one possible way in which lawyer participation undermines the atmosphere of collaborative, mutual, problem-solving mediation is supposed to engender.
91% of respondents also reported that instances of parties making a full apology to the other party accounted for only between 1 and 10% of cases where attorneys were involved, further underscoring the chilling effect lawyer participation may have on the conciliatory atmosphere the mediation model is meant to create. Responses to the survey also indicated that lawyer demeanor during mediation exacerbated the problems outlined above. Lawyers maintained an adversarial attitude throughout the proceeding, refused to acknowledge the concerns of the opposing parties, and in general treated the proceeding “as if a motion or trial.”
This behavior may be symptomatic of inconsistent messaging within the legal community in preparing lawyers for representation in mediation. The field of representation in these contexts has grown very quickly, but there appears to be no consensus in practice or academia as to the precise aims of an attorney representing their client in mediation, how to balance the responsibility of zealous representation with the collaborative goals of mediation, or whether such a balance is even desirable. While some urge lawyers to act as an aid to problem resolution, others focus on “winning” the mediation or attempting to “spin” the mediator in their client’s favor. The inconsistencies of this message have led to many instances of bad-faith practices being employed by attorneys in mediation, from hardball negotiation tactics to outright deception and conduct that verges on the unethical.
While there have been calls for higher ethical standards for representation in mediation, the ABA Standing Committee on Ethics and Professional Responsibility has thus far demurred when offered the chance to expand upon the ethical responsibility of attorneys. The committee disregarded the recent fundamental transformation of the mediation model, still describing mediation as a voluntary discussion overseen by a neutral third-party without decisive powers over the issue: i.e., what the system was intended to be. Instead, both mediation and mediators have become increasingly directive and compulsory with the advent of court-annexed mediation and the evaluative mediation style. In overlooking this fact, the committee passed on a chance to respond to this shift in the legal community’s treatment of the process.
Another problem arising from attorney representation has been its deleterious effect on the confidentiality of the mediation process. Many advocates now use the mediation stage as a “fishing expedition,” allowing them to gather intelligence on the opposing party for use at trial. Others still deliberately misuse explicitly confidential communications arising out of the mediation session in trial settings and, while a highly litigated problem in the mediation process, this behavior often does not face reproach from the courts and is frequently ignored, allowing violation of mediation confidentiality to become routine. This clash of cultures between advocacy and mediation is unsurprising and was predicted over 25 years ago by scholars like Leonard Riskin.
The transmogrification of mediation into arbitration has been aided by the rise in evaluative mediation. Evaluation on the part of the mediator is a significant risk whenever lawyers are employed in that role. This risk exists because, even with training in the facilitative method, lawyers have a tendency to assess the legal merits of the case on their own and that assessment may become apparent to the parties if the mediator is not careful. Some mediators, however, intentionally adopt an evaluative mindset in handling the mediation and will frankly offer their opinions to the parties. This practice has been viewed by some as a mere substitute to arbitration.
In response to this, with the knowledge that cases have a greater chance of settling when the mediator offers their views on the case, many lawyers whose clients are referred to court-annexed mediation will seek out mediators of this type. The evaluative environment incentivizes the parties to attempt to convince the mediator of the merits of their position in the case. This poses a problem, because, unlike arbitration, there are no ethical requirements that parties be truthful in their statements to a mediator. More explicitly hybridized ADR methods such as med-arb present many of these same problems.
Also worth noting is that the more compulsory participation in these processes becomes, the more compliance issues arise. One of the chief virtues in facilitative mediation is that its voluntariness helps to ensure compliance when an agreement is reached. Because parties have a say in the form of that agreement, are at the negotiating table willingly, and feel free to be honest with the other party, they are much more likely to accept the result. This benefit goes away as mediation sessions become less the product of mutual consent and more the result of judicial imposition. As a result, mediation may run into enforcement issues of the kind arbitration awards have faced in the past.
Arbitration awards in their early history were generally enforced in a communitarian fashion. Agreements would be honored because each member of the community relied on the good faith of the others. As time went on, this reasoning became insufficient to ensure compliance and the federal government was forced to act. It did so in the 1925 Federal Arbitration Act. Similarly, mediated agreements were at one time enforced by prevailing socio-cultural mores, but have begun to require direct intervention by judicial authorities, putting many of these court-annexed settlements right back in the courtroom in enforcement proceedings.
IV. WHY MEDIATION IS SHIFTING TOWARD AN ARBITRATION ZONE
Methods of dispute resolution are ultimately informed by the culture that forms the context of the dispute. The legal culture has always been an adversarial one. It could be argued that the smaller facilitative culture of mediation is merely being absorbed into the larger adversarial culture of the legal system, or that the increase in court-annexed programs has stripped the process of its voluntariness (a feature which incentivized collaborative, agreement-seeking behavior). However, the shift may also be reflective of western culture at-large, and its approach to disputes. The prevailing cultural tendency in the United States is to place emphasis more on justice and the vindication of personal rights than on the facilitation of agreement and collaborative problem solving. This tendency has therefore remade mediation in its image, creating an adversarial atmosphere where each party is most concerned about seeing their rights respected, not so much coming to an agreement.
V. CONCLUSION: MEDIATION AT THE CROSSROADS
The impact of our adversarial culture on mediation is significant. Ratcheting dispute resolution processes to increasing levels of formality and adjudication leaves the bottom rung of the ladder empty. Parties have nowhere to go that facilitates problem-solving and compromise and are left instead with several different varieties of adjudication from which to choose. This leaves no place for the concepts of interest-based bargaining and self-determination in a landscape of dispute resolution options that are increasingly just variations on a theme rather than alternative paradigms for problem-solving. The differences in opinion as to the purpose behind the various dispute resolution models raise important questions for both the practical and ethical training of legal professionals. Corrective measures should be taken. Instructors and policy-makers should take action to create guidelines that preserve the cooperative purposes behind mediation and rein in the slide of ADR models away from their intended purposes into mere surrogacy for trial litigation. Right-minded mediators should endeavor to set mediation back onto its facilitative moorings in their personal practice. Evaluative mediation should be restrained to those discreet circumstances where such evaluation is desired by both parties and should be modest in scope. The rules of professional conduct should be amended to require candor from advocates in the claims they make to mediators during caucus sessions. Finally, mediators and advocates should come together to create guidelines and affirm an understanding that the process is not meant to be advocate-driven and adversarial, but facilitative of negotiated agreement, stewarded to completion by the mediator.
Posted in: Volume 11, Issue 4