How to Mediate Insured Claims and Other Monetary Disputes.

Mediators fantasize about converting fierce opponents into genial joint problem solvers. However, in the real world of personal injury and other lawsuits for money, mediators must help parties who hear the first offer and shout, “That’s insulting! Don’t they realize. . . ?”

Mediator J. Anderson Little shared his strategies for facilitating resolution of such disputes in his book, “Making Money Talk: How to Mediate Insured Claims and Other Monetary Disputes.” Little’s ideas are useful to both mediators and advocates who negotiate civil lawsuits over money.

Have a plan, work the plan, and revise the plan.

Little’s primary message is, Have a plan for movement. Before attending mediation, consider where you will to start and end the negotiations. Plan the moves you will make to achieve settlement within your authority. During mediation, consider what message you communicate with each offer and how to avoid miscommunication.

Reactions to Unrealistic Offers.

A large part of a mediator’s job is to help the parties process their negative reactions to unrealistic offers. Usually, one party will open with a unrealistic offer. The mediator can discuss with the offeror the reasons for the too-high (or too-low) offer and identify the benefits and risks of such an offer. If, nevertheless, the party wants the mediator to present an outrageous offer, then the mediator must help the other side control their negative reaction. One approach is to talk through the pros and cons of the following options: (1) get up and leave, (2) make a counteroffer that is similarly outlandish, (3) or, in effect, ignore the outrageous demand. Pretend that the initial offer was reasonable, and counter with what you would have offered, anyway.

Movement Breeds Movement.

“The greatest motivation of the parties to settle is the perception that the case can settle. And the greatest impediment to settlement is the perception that the case will not settle,” observed Little. If parties begin negotiations on opposite planets of, say, $800,000 and $8,000, then they feel discouraged from making offers in a “real” range. One common response is to make small moves — $780,000 and $8,200 — thereby trying to pull the other side toward a real range and trying to avoid a signal that you’re willing to split the difference. Small moves breed small responses. On the other hand, a big move will often motivate the other to make a significant move, too. “The solution to getting better movement then, is counterintuitive. The way to get movement is to make movement,” says Little.

There’s a time in most mediations when litigants get discouraged about the chances of resolution. “We’re not getting anywhere!” Or “We’ve made our best efforts.” As litigators, the optimism with which we began the day has soured into fatigue, frustration, and anger that the other side is so pigheaded. However, from my own experience as a litigator, it is during this last phase of the mediation that we can best serve our clients. Everything before was just the preliminary ritual. Now, the real negotiations begin.

Conclusion

Little’s book, “Making Money Talk” reminds us that before attending mediation, litigators and their clients need to consider what they are willing to pay or accept, their opening bids, and how to move through their range of acceptable outcomes. Money does talk; litigants derive meaning from offers. A mediator’s job includes trying to help the parties interpret the offers and respond. Before concluding any mediation, the mediator should help the parties reevaluate their positions and help them determine additional strategies for movement. Only then can the parties measure the true distance between their positions and decide whether they can bridge the gap.

Jeff Merrick
Merrick Mediation
Copyright 2012

Jeff Merrick