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Monetizing Risk

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Personal Injury Risk Evaluation is a multi step process. But the ultimate result of that multiple step process is to put a dollar value on the risk – monetizing the risk. The first step is to identify each issue that will be presented to the jury on a jury verdict sheet. So let us look at a frequently occurring verdict sheet – a rear end motor vehicle accident.

Here are the essential facts of our practice case.

REAR END

SOFT TISSUE DAMAGE

UNDER $1,000 PROPERTY DAMAGE

$4,000 MEDICAL TREATMENT

$2,000 MEDICAL DIAGNOSTIC

$8,000 PHYSICAL THERAPY

$1,000 WAGE LOSS

5% PERMANENT DISABILITY

 

Verdict Sheet

1.Was the Defendant negligent? Yes___ No___

2.Was the Plaintiff negligent? Yes___ No___

3.In what amount do you asses damages?

Loss Wages___________

Medical Expenses____________

Pain and Suffering____________

 

In order for the jury to consider damages the plaintiff must get a yes to the first question and a no to the second question.

 

The process of evaluating a case needs to be disciplined and organized. You want to accurately identify all RISK factors that will affect your recovery. There are positive and negative risk factors. Positive factors increase the value of your case, while negative factors decrease the value of your case. Both are important and you do not want to miss any. And then there are factors which would on the surface appear to affect the value but do not — the red herring factor. A word of CAUTION. You cannot — I repeat cannot – properly evaluate  a case until you know all of the facts which are relevant to the issues of liability and/or damages.

 

Liability factors should be evaluated first. The goal here is to determine what your chances are of getting a plaintiff’s verdict. Is it 25%, 50%, 75% or 100%? If it were less than 100%, prudence would dictate that you reduce the amount for which you would settle the case. In our practice case a rear end accident you can say that you have a 95% chance of a verdict on liability. Why not 100% – because you can lose that battle or rare occasions.

Now lets us look at our practice Case.

 

Liability. There is no evidence that the this rear ended was caused by other than the defendant’s negligence. So we can say that the plaintiff has a 95%- 100% chance of a verdict on liability.

 

Damages. The only question on damages is how much the claimant will be awarded for pain and suffering. Tracking jury results would reveal that in 8 out of 10 verdicts the pain and suffering award for this type of case would be about equal to the medical expenses or $14,000. So the range of a verdict would be $26,000 to $20,000. With regard to the permanency rating juries and judges generally are not persuaded that this type of collision causes a permanent injury even when a doctor gives a permanency rating.

 

Does it matter whether the case is tried in a  liberal or conservative jurisdiction? Generally there is very difference with 80% of the verdicts. The exceptions (the 20%) however break against the plaintiff in the conservative jurisdiction but against  the defendant  in the liberal jurisdictions.

 

Personal Injury Jury Trial Risk Evaluation

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Personal Injury claim formPersonal injury jury trial risk evaluation begins as a claim for personal injury is processed through the claim process with the insurance company.During this process a lawyer begins to evaluate the strengths and weaknesses of the claim. This process is mostly directed at finding accurate information about the claim – eyewitnesses, medical expenses, medical opinions and the like. When a claim matures to the point that all the relevant information is known a process of evaluation begins – what is the claim worth. Generally speaking a claim is worth what a jury will award the claimant.

Trying to figure out what six folks – the jury – will do seems so impossible that it is not worth the effort. After all we do not even know who the six jurors will be. Will they be young or old, conservative or liberal, employed or unemployed – it is just not known until the final six are in the jury box and the case begins.jury

My quest for this type of knowledge began in 1967 , the year I graduated from law school, when I began clerking for Judge Ralph W. Powers and Judge J. Dudley Digges in the Circuit Court for Prince George’s County, Maryland.

Every trial lawyer wants to know what a jury might do in her next case – and a client desires to know to a greater extent.After clerking for Judge Powers and observing many jury trials I began to represent clients and actually try cases – some successfully and some not so successful. I was appointed as a Judge in 1982 and began trying cases in my courtroom. The Circuit Court for Prince George’s County had a very active settlement conference practice which I participated in – 5-7 conferences each day. Fortunately I had three much more experienced colleagues to guide me through this process – Judges McCullough, Blackwell and Levin. Every day at lunch we would discuss the day’s docket and I would ask them a thousand questions. Patiently, they would detail their collective experience.

Then in 1986 I began to record each verdict of our court – 13 judges( now 23) – several hundred verdicts each year. Over the years I have recorded over 5,000 verdicts and reported many of them to the bar.See Maryland Trial Verdicts.Very soon after I began this recording process it became very obvious that certain liability scenarios and personal Injuries were comprising the vast majority of the verdicts.

On the liability side these types were frequent – left hand turns, lane changes, snow and ice , slip and fall. On the injury side these types were frequent – sprains and strains, neck/back, pre existing conditions, knees/shoulders, broken bones, death.

Because these various types were frequently occurring it became pretty obvious that there were patterns of results. The patterns then served as a guide when trying to figure out how to avoid losing a case by entering into a good settlement. In future posts I will go into some of those patterns in detail.

Good lawyering also becomes a material part of the evaluation process. I often tell lawyers asking my advice on lawyering skills that usually  a bad lawyer cannot screw up good facts/law and a good lawyer cannot rescue bad facts/law. All though the great lawyers occasionally break this rule of thumb.

Recently the Grandson of one of those great lawyers appeared in a settlement conference and I told him a story of his Grandfather that occurred while I was clerking for Judge Powers in 1967.His Grandfather was trying a premises liability case where there was no evidence of actual notice to the landlord of a dangerous condition that caused the plaintiff to fall and be injured. During the trial a great deal of time had been spent describing the circumstances surrounding the condition that caused the fall. Circumstances such as how long the liquid had been on the floor, how visible the liquid was, how many people passed the liquid before the fall. At the end of the plaintiffs case the defendant moved for a directed verdict on the grounds that there was no evidence that the landlord knew that the liquid was on the floor – there was no actual notice. Judge Powers was about to grant the defendant’s motion and the plaintiffs lawyer from Baltimore, Marvin Ellin, pleaded with Judge Powers that while the current law favored the defendant the correct law was that of constructive notice. It was late in the day and Mr Ellin pleaded with Judge Powers to give him the overnight recess to provide a legal memorandum supporting his position. Reluctantly, Judge Powers agreed.

When I got into the courthouse before 7 AM the next day Mr Ellin was there in the hallway waiting for the door to be open with his freshly typed 20 page memorandum. Judge Powers arrived shortly and when he returned to the courtroom the defendants motion was denied. Later in the day a $50,000 plus verdict was returned for the plaintiff. Now that is great lawyering. It was several years later that the Court of Appeals of Maryland ruled that the doctrine of constructive notice was applicable in premises liability cases. (Regretfully, Marvin Ellin recently passed away)

How to Value A Personal Injury Case

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Senior Judge Arthur M. Monty Ahalt

On January 23 , 2020 Charles “Ben” Peoples and I made a Webinar presentation to over 100 lawyers and adjusters regarding how to value personal injury claims. During the presentation, the audience was surveyed regarding different issues. 

The principles, which were set out , are based upon Judge Ahalt’s 52 years of experience as a trial lawyer (15) and judge (37). As a Judge on the Circuit Court for Prince George’s County, Maryland, he tried over 1,000 jury trials and handled over 10,000 settlement conferences. For many years, he has tracked all verdicts in the Circuit Court for Prince George’s County and published those verdicts to the bar. The verdicts now can be found on the links at the top of the page. The reason that Judge Ahalt originally went to the effort of tracking verdicts was to give the bar a frame of reference as they evaluated cases. Additionally, Judge Ahalt regularly talks to his colleagues in Prince George’s County, and around the state and region in an effort to know if the results in Prince George’s County differ. As discussed in more detail below, they are not markedly different. Judge Ahalt also was very fortunate to have very experienced mentors, colleagues and evaluation experts in Judge Albert Blackwell, Judge Jacob Levin and Judge William McCullough. 

You can access and read the entire article here


National Academy of Distinguished Neutrals – MdMediators.org

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The National Academy of Distinguished Neutrals is pleased to announce the launch of its Maryland Chapter – the “Maryland Academy of Mediators & Arbitrators” (MAMA) – online at www.MDMediators.org. 

Just 8 attorneys and former judges have been recognized as Charter Members of the Maryland Chapter, including most of the state’s most widely-accepted ADR professionals. The MD Chapter has an appointed Executive Committee which includes 3 leading local ADR practitioners: Jonathan Marks (Bethesda), Judge Steven I. Platt (Annapolis) and Sean Rogers (Leonardtown). 

Include the availability of the following neutrals:

 All Maryland Calendar Members



Non-Calendar Members:

The Academy’s new website is designed to “make life easier” for local attorneys, counsel, adjusters and legal support staff. www.MDMediators.org allows firms to quickly find a suitable neutral by identifying preferred practice criteria or dispute types, navigating straight to a roster of trusted local mediators and arbitrators. A majority of the Academy’s members also publish their availability calendars online for the benefit of clients. This allows the selection of a neutral and the scheduling of appointments to be greatly expedited for all parties involved. 

MDMediators.org is connected to the Academy’s national www.NADN.org database, already in wide use by attorneys across more than 30 state bars, including Alabama, Arizona, California, Colorado, Florida, Georgia, Louisiana, Mississippi, New York, New Jersey, the Carolinas, Tennesse & Texas.

In 2013, NADN was named Neutrals Database Partner to the national defense bar association (DRI) and the national plaintiffs bar (AAJ, formerly ATLA), providing these association’s 40,000+ litigators with vetted biographies of the nation’s top-rated mediators and arbitrators, via the DRI and AAJ websites. Only ADR professionals widely respected by local defense and plaintiff firms are invited to submit bio materials for review by NADN and state committees. 

“We’re delighted to welcome these top-rated neutrals to form the Maryland Chapter of the Academy,” commented Darren Lee, Executive Director of NADN. “We’re confident that the NADN database will prove as useful to litigation firms in Maryland as it has to other state bar communities in recent years.”

The National Academy of Distinguished Neutrals (NADN) is an association whose membership consists of mediators and arbitrators distinguished by their hands-on experience in the field of civil and commercial conflict resolution. As of June 2014, the association has over 900 top-tier ADR attorneys and judges confirmed as members in each of the 50 states, making it the largest free online roster of vetted civil mediators and arbitrators in the nation. Membership to the Academy is by invitation-only, with a strict peer-nomination vote and extensive client-interview vetting procedure, intended to ensure that only the top 5-10% of civil ADR practitioners in each state are invited to join the association. For more info, please see www.NADN.org/about

For further info regarding the National Academy of Distinguished Neutrals, please contact Rose-Anne Raies (roseanne@nadn.org) or visit www.NADN.org/about

THE NATIONAL ACADEMY OF DISTINGUISHED NEUTRALS 104 Churchill Way, W. Palm Beach FL 33411 • Tel: (813) 600-5678 • Fax: (866) 257-4698 • www.NADN.org

In-Depth Biographies and Calendars Now Available At www.MDMEDIATORS.org

National Member Directory online at www.NADN.org/directory

USING EVALUATIONS IN MEDIATION

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USING EVALUATIONS IN MEDIATION 

Dwight Golann [1] and Marjorie Corman Aaron [2]

 

  1. Introduction

Evaluation is a controversial issue. Some mediation theorists believe that the technique has no place in “true” mediation, a purely facilitative process in which parties are left free to make their own judgments about the merits of a case without interference from the mediator. [3] We hold a different view. Evaluation is a legitimate weapon in the mediator’s arsenal, one that can be either effective or explosive depending on how and when it is used.

 

  1. Evaluation Defined

What is evaluation? It is a process in which a neutral expresses an opinion as to the likely outcome or value of a legal claim or defense were it to be adjudicated. Evaluation can focus on either a single issue or on the overall result in a case. It can be expressed in ranges (“the damages could range from $25,000 to $75,000”); numeric probabilities (“40% chance”); or as a precise number (“a $100,000 case”). An evaluation can be expressed with certainty (“The plaintiff will win … “) or studied vagueness (” I have some doubts about… “). Evaluation is sometimes hard to distinguish from “reality testing.” Almost all mediators are willing to reality test-that is, to question disputants about the strengths and weaknesses of their cases. In this role, a mediator acts as a devil’s advocate, pushing the disputants to become more realistic without completely revealing his or her personal opinion about the merits. However, as mediators become more and more familiar with the facts and arguments, it is almost inevitable that they will form views about how a court would rule on a case. Parties, not expecting mediators to be potted-plants, are aware that the judgment-formation process is going on.

 

Mediators may be less successful than they think at hiding their opinions about the merits. Reality testing is a spectrum in which the line between mere testing and evaluation is not always clear. For example, a phrase such as “What are your thoughts on the causation issue?” is unlikely to be controversial. But such commonly-asked questions as “Do you think there’s a problem on causation?,” “What would you say in response to their argument on causation?,” “Don’t you have a causation problem here?” or “You don’t think that’s an issue?” are increasingly likely to be interpreted as evaluative opinions. Even if the language used by a mediator is scrupulously neutral, his or her feelings about the strength of an argument may well show unconsciously in facial expressions and body language. It is likely that litigants perceive evaluation going on in many situations where a mediator would describe behavior as “reality testing.” The fact that evaluative input of this nature is common in mediation makes it important for mediators to understand how to do an evaluation properly, and for lawyers to know when to request that such techniques be applied.

 

III. Benefits and Dangers 

Like most other tactics, evaluation has both potential benefits anddangers. In the case of evaluation, however, both the risks and the advantages are relatively large.

.

  1. Benefits

An evaluator’s primary goal is to change litigants’ assessments of the strength of their adjudication alternatives. Often both sides in a legal dispute honestly believe that they are likely to win in court. Mediators find that when parties put their predictions in terms of percentages, their forecasts often total 150% or more; that is, each side thinks that it has a much better than even chance of prevailing. Given these clashing predictions, it is not surprising that even good faith negotiations often reach impasse. The causes of such misjudgments are complex. Psychologists have demonstrated, for example, that people tend to form perceptions of situations quickly, then unconsciously ignore any information that contradicts their view, a phenomenon called selective perception. People’s judgments are also influenced by their roles in litigation, an effect known as advocacy distortion. For example, in an experiment at Harvard Law School, students were given identical files describing an auto accident, then asked to evaluate the plaintiff’s chance of winning in court. Those assigned the role of lawyer for the accident victim assessed her chances of prevailing at a mean of 65%. By contrast, students who were given the same case file, but told that they represented the defendant insurance company gave the plaintiff only a 48% chance. Similar discrepancies appeared in the students’ estimates of the damages the plaintiff would recover if she won: “plaintiffs” placed the damages at a mean of $264,000, while “defendants” projected only $188,000. Harvard Business School students asked to carry out the same study showed very similar biases. These kinds of advocacy distortions are nearly universal. [4]

 

 

 

 

Evaluation can cut through litigants’ misjudgments about the merits of a case. When disputants hear that a neutral person, after studying the facts and listening to the arguments, disagrees with their predictions of victory, they are motivated to look again at the case and ask what the evaluator has seen that they have not. Evaluation can thus help disputants overcome the impact of selective perception, advocacy bias and other factors that distort parties’ assessment of the merits. An evaluation can also satisfy psychological needs. It may give litigants the emotional experience of having a day in court, in which they can present their arguments to a neutral person. If bargainers realize that concessions are necessary, but do not want to move from entrenched positions without having a rationale, an opinion can provide the necessary psychological cover. Similarly, insurance adjusters, government officials, and others who must answer to supervisors and constituencies outside the mediation, often welcome an evaluation because they can use it to deflect after-the-fact criticism of their decision to settle. Finally, evaluations can help to resolve internal disagreements within a bargaining team, for instance by assisting a litigator who sees serious risks in a case persuade an unrealistic client of the need to settle.

 

 

  1. Dangers

Unfortunately, evaluations pose dangers that may outweigh their benefits. First, an evaluation may freeze the bargaining process. Once the parties to a mediation know that an evaluation is coming, they are likely to stop negotiating: After all, why confront painful decisions about concessions when the neutral will soon vindicate one’s position? But once the evaluation is given, it may be treated as a “take it or leave it” offer. After a respected outsider has stated the “right” or “fair” result in a case, it is very hard for a defendant to offer more, or a plaintiff to accept  less, than the number the evaluator has set. The strength of this “take it or leave it” effect is inversely proportional to the confidence of the negotiators in themselves and in the evaluator. The more concerned a bargainer is about being second-guessed by a client or supervisor, the less willing he or she will be to accept a result less favorable than the evaluation.

 

Equally significant is the potential impact of an evaluation on the mediator’s credibility with the litigants. A neutral’s greatest asset in bringing about a settlement is the rapport and confidence that he or she develops with the parties and their counsel. As long as litigants see the mediator as an honest, neutral and competent facilitator of the process, they are willing to listen to tough questions, accept coaching about their bargaining tactics, and consider settlement recommendations that require painful compromises.

 

If, however, a mediator delivers an evaluation too quickly or in the wrong way, the “losers” in the evaluation are likely to react badly. A party, its lawyer, or both may decide that the neutral has “gone over to the other side.” Perhaps, they think, the neutral has been duped by clever arguments, or seduced by promises of future business. Indeed, if the evaluator disagrees with both sides, as is quite possible, everyone can be left angry. Once this happens, even the most innocent comment or gesture by the mediator will be filtered through feelings of suspicion and antagonism. A badly-done evaluation can destroy the mediator’s power to influence the losers, and perhaps everyone, in a case.

 

There are less dramatic dangers as well. Evaluators focus on the legal merits and may fail to address less obvious barriers which may be frustrating a settlement. If the problem, for example, is that a key decision maker in any settlement is not at the bargaining table, an evaluation is unlikely to uncover the issue. If the obstacle is a party’s unresolved feelings of grief, a lawyer’s anger, or other strong emotions, an evaluation, with its emphasis on legally-relevant facts, will not deal with it. In general, evaluation does not address the hidden issues that often drive lawsuits. More seriously, evaluation tends to hide these issues because it focuses the disputants solely on the legal merits of the case. Evaluation, in other words, often “solves” the wrong problem and, by doing so, obscures serious hidden causes of impasse.

 

All this said, the right kind of evaluation, done at the right point and handled in the right way, can be the ingredient that breaks a seemingly hopeless deadlock.

 

  1. How to Give an Effective Evaluation

 

  1. Whether to Evaluate

 

Our basic advice about whether to evaluate is “only if necessary.” Unless required to break an impasse, evaluation’s inherent risks, make it unwise. The fundamental diagnostic questions that a mediator should ask in every dispute are the following:

  • What obstacles are preventing the parties from settling this dispute themselves?
  • What meditative strategies are most likely to overcome these barriers and bring about a settlement?

 

In most cases, the barriers that are frustrating agreement, such as procrastination, the need to vent arguments and emotions, poorly conducted positional bargaining, lack of information or hidden psychological issues, do not relate to the parties’ view of the merits. Specific meditative strategies are available to address these issues, [5]making evaluation inappropriate.

 

In some situations, however, even after other barriers have been diagnosed and treated, the major obstacle to settlement remains the parties’ (or their lawyers’) inability or refusal to accurately assess the value of their trial alternative. Even pointed reality testing has not (or is unlikely to) overcome the effects of selective perception, advocacy bias and other psychological forces that distort litigants’ perceptions. [6] In such situations, a mediator’s only remaining options may be either to conduct an evaluation or admit defeat. If evaluation is the BATL (Best Alternative to Litigating), [7] there’s no harm in the attempt.

 

 

  1. When to Evaluate

As should be clear from this discussion, we believe in delaying an evaluation until as late in the mediation process as possible. Waiting serves several important purposes. First, it allows the mediator to explore fully the other possible obstacles to settlement. If, for example, a key issue in a dispute is a party’s need to express grief over a loss or anger at a business partner, deferring an evaluation allows the mediator to discover the issue and work on it. This kind of exploration is much more difficult after an evaluative “verdict” has been handed down. For a discussion of these and other barriers and specific strategies to address them,

 

Even if the problem is limited to the legal merits, it does not follow that an evaluation is always required. The cause of the parties’ differing assessments of the merits may be that one side lacks key information; if so, a mediator’s initial response should be to arrange a data exchange. It: instead, the problem is that one side fears that a settlement would create a precedent, a neutral should focus on confidentiality guarantees. In our experience, it is usually possible to solve many merits-related problems without the need for an explicit evaluation by the mediator.

 

A second reason not to evaluate quickly is that a mediator will have more time to build and strengthen the parties’ trust. As the process goes forward, parties and lawyers get to know the mediator much better on both a professional and a personal level. In formal sessions, the participants are able to watch the mediator in action and observe how he or she handles challenges. During informal conversations and telephone contacts, the parties and counsel begin to get to know the mediator as a person. In this way, an effective mediator can gradually build up the disputants’ trust and confidence. The mediator can then draw on this reserve to cushion the shock of an unwelcome opinion on the merits. Also, the mediator will have the opportunity to learn more about the parties in order to phrase his or her evaluation in terms that will be most palatable to the audience.

 

In addition, when a mediator prefaces the evaluation with questions and discussion of the merits, the parties often become more realistic about their cases, narrowing the scope of any opinion that the mediator must offer. The litigants may also realize that weaknesses in their case which they had hoped to keep hidden are in fact apparent to the other side. Finally, the disputants see that the mediator has heard them out and is seriously grappling with the facts and arguments they raise. The participants also learn that the mediator is raising their strongest arguments with their adversaries. As the mediation progresses, then, the disputants appreciate both that the mediator is giving them a fair hearing and has “done the homework.” They are able to come to terms with the fact that the holes in their case are known.

 

There is one final “when” issue: Should a mediator obtain the consent of the parties before going forward with an evaluation? At one level, this is an issue of contract. Some mediation agreements require neutrals to get the assent of all parties before offering an evaluation, while other forms leave the issue to the mediator’s discretion. [8] A mediator owes participants the obligation to discuss process issues. But if, after this is done, the parties choose to remain in the mediation, it is best that the neutral retain the discretion to evaluate if necessary to stimulate a settlement.

 

Our overall advice about when to give an evaluation is this: Evaluate as late in the process as possible. As a rule of thumb, never do so until at least the first round of caucuses is completed. Only consider evaluating after you have had a reasonable chance to diagnose and treat other obstacles to agreement, using less risky tactics such as reality testing, and have talked with the disputants about your intentions. In our view, evaluation should usually be the final and almost never the first, arrow in a mediator’s quiver.  

 

  1. What Standard to Apply?

The most common standard used in evaluations is one of prediction: The neutral attempts to forecast how an arbitrator, judge, or jury would resolve certain issues or the entire case, if the party opted for a binding decision.

 

This predictive standard may seem self-evident, but in practice it is not. Mediators sometimes focus on how they personally would decide a case. This is irrelevant, however, since neutrals rarely serve as judges in their own unsuccessful mediation’s. [9] This standard is also dangerous because it puts the mediator into the position of personally rejecting one or both parties’ arguments, making it even more likely that they will come to view him or her as an enemy.

 

Another standard mediators sometimes apply is: “What will it take to settle this case?” In other words, given the negotiation dynamic, what package of terms is likely to be minimally acceptable to everyone in the dispute? If, for instance, one side is stubbornly unrealistic about the likely court outcome, a “What will it take’)” opinion might bend the proposed terms toward that view in order to secure agreement that is easier for parties to accept.

 

Although there is nothing inherently wrong with this approach, a serious problem arises when disputants think that they are hearing a pure merits-based evaluation but instead receive a “What will it take?” recommendation. For a mediator to offer a settlement recommendation under the guise of a legal evaluation is both unethical and capable of creating serious practical problems when parties discover that they have been misled.

 

Evaluators should give their best “straight” prediction of how the likely decision maker would resolve an issue or case. However, when the litigants explicitly agree to receive a settlement recommendation rather than a merits evaluation, then a “What will it take?” opinion is appropriate.

 

 

  1. Structuring the Evaluation 

 

The first issue for a mediator to consider is whether he or she will perform the evaluation, or suggest a person outside the process. There are many advantages to an outsider’s evaluation. First, it distances the mediator from the process, greatly reducing the risk that a disappointed disputant will hold the results against the mediator. Second, the mediator and lawyers can select an evaluator with the credentials most likely to impress the parties, without concern about balancing evaluative credentials with facilitative skills. If, for example, the parties would be most swayed by a prediction from an eminent jurist, they can retain a former chief justice without worrying about whether he or she knows how to mediate.

 

A third advantage of going outside is that it allows the mediator to focus energies on a single role: that of facilitator. Fourth, it solves the nagging issue of what a mediator who also evaluates should do with any information that may have been disclosed on a confidential basis in caucuses. [10]

 

There are practical difficulties, however, with using an outside evaluator. First, unless the two roles are assigned at the outset, making arrangements for an outsider to come in will usually require adjournment of the process and disrupt its momentum. When parties are allowed to cool off, they may harden their positions. Second, retaining an outsider is more expensive than having the mediator give an opinion, and many cases will not support the cost and delay of additional briefing. Finally, even with the mediator’s assistance, the parties may be unable to agree on who should perform the evaluation. For these reasons, the parties almost always request that the mediator take on the task.

 

  1. Limit the Issues – The next question is how much of the case to evaluate. Novices often assume that an evaluation must cover the entire dispute, but this is not so. The legal issue driving the parties’ impasse may be a relatively narrow one (for instance, will the liquidated damages clause of a contract be enforced?). If so, there is no need to evaluate other issues on which the parties are closer to agreement. Indeed, if the evaluator’s view of those other issues differs from that of the parties, evaluation would stimulate disagreement rather than resolve it. 
  2.  Piggyback Whenever Possible – A corollary to not evaluating issues unnecessarily is to build on the parties’ opinions as much as possible. A plaintiff, for example, may have a realistic take on liability but an inflated view about damages. If so, it is more effective for an evaluator to say that he or she will accept the party’s liability percentage “for argument’s sake,” although perhaps noting mild disagreement with it, then press the evaluator’s opinion about the likely damages. It is easier to change a person’s mind on one issue than two, and an evaluator’s “concession” on one point will often induce disputants to accept his or her views about other, more controversial issues in the case.
  3. Think about Who Needs to be Influenced – One’s tendency is to assume that evaluations are done solely for people in the mediation room. This is often not true. The real cause of an impasse may be a decision maker in a distant city who has not participated in the mediation or felt its impact. Or negotiators may be hesitating out of fear that a decision to compromise will expose them to criticism from supervisors or outside constituencies. If the problem is absent decision makers, the evaluation can often be used as an event to get their attention, and sometimes their actual presence at the scene. There is something about the idea of even a non-binding “verdict” being handed down that brings a case onto the radar screens of persons who have felt too busy to pay attention to it before. If the issue is fear of being second-guessed, and the potential critic cannot be brought to the mediation, it may make sense to put the evaluation in the form of a written opinion that a party can take to his or her constituency or place in a case file. If an evaluation is to be used to convince persons outside the process, the credentials and public reputation of the evaluator become more important than his or her personal qualities. In such circumstances, a mediator will not be able to use the trust he or she has built up during the proceeding to sell the result, and may want to select a third person whose resume will impress an absent decision maker.

Example: A mediator was working on a dispute between a government loan agency and a borrower who had defaulted on his mortgage. As the mediation went forward, it became clear that the loan foreclosure had been handled badly by the original lender, making it difficult now for the agency, which had inherited the loan, to collect on it. Still, the agency refused to settle the case. In caucus, the agency disclosed that it needed a letter from the mediator evaluating the case and endorsing the result in order to settle. The agency was not willing to have the letter shown to the borrower; instead, it would be used by the agency to convince a review board to approve the deal. The borrower’s counsel agreed to these terms, the mediator wrote the letter, and the case was settled.

D .Choices in Effective Format – Before undertaking an evaluation, consider what format will maximize its contribution to a settlement:

  • What data will the evaluator receive? For example, will the parties rely on existing documents or prepare special briefs? Note that special briefing is more likely to be necessary if an outsider is brought in to do the evaluation.
  • Do the parties need the feeling of having a “day in court”? Will the evaluation have more weight if they are allowed to make formal arguments? If so, consider conducting the process in a “moot court” format.
  • Should the opinion be delivered in caucuses or during a joint session? If it is delivered to the disputants in each others’ presence, the losers may feel humiliated; creating anger that will disrupt the process. If, on the other hand, the evaluation is presented in separate caucuses, the disputants may suspect that the evaluator is delivering different opinions to the two sides.

 

We rarely ask for special briefing because it would usually require adjourning the process. We also avoid “moot courts,” because to hold, one risks elevating the importance of an evaluation from impasse breaking tool to final pronouncement in a case. We also strongly favor delivering evaluations in caucus. This is not in order to deliver different legal analysis or numerical evaluations to each side. Rather, it is because evaluating in caucus allows us to use phrasing and arguments calculated  to help the listeners to accept our opinion. In caucus one can, for example, piggyback one’s views on bits of confidential information that party has shared. The mediator-evaluator could, for instance, concede that an opposing witness might be lying as that party has been arguing but go on to say that the witness has a demeanor that would impress a jury. Evaluating in caucus allows us to more frankly acknowledge strengths in each side’s arguments, and build on that foundation to deal with more controversial issues.

 

The problem of demonstrating that the evaluator is delivering the samc opinion in each caucus is a real one. It can be addressed, for example, by writing a bullet point form of the evaluation on a flip chart or notepad and carrying it from one caucus room to another. Putting the opinion in writing has the extra benefit of giving visual reinforcement to unwelcome news and reduces opportunities for the parties to engage in “selective perception” of the evaluation.

  1. Consider Language, Culture and Commonality –A mediator’s choice of language, tone and cultural referents in presenting an evaluation will greatly influence its impact on the parties. One’s individual and cultural background is what it is. But a bit of chameleon ship in style and manner can increase the persuasiveness of the opinion, particularly when its content is critical. If, for example, one party (whose team may include a lawyer, expert and several client representatives) is informal, given to slang and colorful metaphor, it may be effective to use that style in their caucus. If the other party is more formal, deliberate and analytical, the mediator will do well to choose a tone and language likely to resonate with that group. In short, this advice on choice of style and manner is “When in Rome … ,” particularly when the substance of the message is relatively unfavorable. This is another reason to present evaluations in private caucuses with each side.
  2. Be Empathetic –Acknowledge the listening party’s concerns and arguments and why a result you see as likely or possibly may seem unfair or surreal. Predictions are not pronouncements of right and wrong; you can actively listen to and reflect or empathize with a party’s feelings and responses.
  3. Emphasize Differences in Perspective –It is sometimes difficult for disputants to accept that someone who has the same information as they do nevertheless disagrees strongly with their judgments. One defense is to emphasize that in doing an evaluation, you are not giving your personal opinion about what is a fair resolution, but instead are predicting how other people whom the disputants have never met (a judge or jury) would react.

 

We also note the special advantages of being neutral. Because we are not arguing the case and have no personal stake in its outcome, we are free to think about it from the perspective of an uninvolved person. It is difficult for disputants to admit that their judgment may be distorted by their roles in the case (although they readily see that the condition affects their opponents and perhaps their clients). Our practice is to mention the point but not to stress it heavily.

  1. Distance Yourself from the Opinion –As we have noted, it is very important that the mediator not become personally identified with an unwelcome opinion. One method of doing this is to follow the guidelines set out above: empathize with the problem that this creates, note that you will never sit in judgment on the matter, use the language of prediction, and so on. Another way for mediators to distance themselves is to use the technique known as decision analysis. Decision analysis is a mathematical technique that allows analysts to break down a case into a series of choices and chances (win on summary judgment or not; win or lose at trial; recover a high, medium or low verdict, etc.). The case is then “graphed out” in a way that lets the parties see the possible outcomes in the litigation and weigh the probabilities of each one. Individual choices and chances are then multiplied out, yielding an overall monetary value for the case. Decision analysis allows mediators to talk with disputants in a relatively dispassionate way about what could happen if a dispute is adjudicated. It allows both the neutral and the parties to “let go” of emotional arguments and consider litigation risks in a logical manner. Also, because participants are asked to discuss and estimate the percentage likelihood of success on each issue before calculating its impact on the case’s overall discounted value, they may provide more honest assessments. For this reason, decision analysis can be a constructive vehicle for discussing the parties’ or the mediator’s case evaluation. [11]

 

VII. Conclusion 

Evaluations rarely end cases themselves. Rather, they provide a strong “dose of reality” that helps break down differences in how the parties assess their no-agreement alternatives. Assuming an evaluation is necessary; therefore, mediators need to think in advance about how to use them to promote further negotiations: 1. Is reflection or consultation time needed? In simpler cases where the decision makers are present, a mediator can give an evaluation orally and then ask for a new offer. But when the case is complex, the results shocking to the listeners, or the evaluation calls for an offer outside a negotiator’s authority to settle, an adjournment will probably be needed. 2. What kind of bargaining should occur after the evaluation? Who should make the next concession? Are inventive terms possible that would obscure or cushion one side’s defeat in the evaluation? Should the mediator make a compromise proposal, to some degree influenced by evaluation results? If so, should the proposal be presented as a “mediator’s proposal” basis that allows each side to conceal its willingness to agree unless the other side has assented as welI? [12]

 

(AAA HANDOOK ON MEDIATION, 2010)

Dwight Golann

Professor of Law, Suffolk University Law School

Marjorie Corman Aaron

Professor of Clinical Law and Director, Center for Practice,

University of Cincinnati College of Law

[1] Dwight Golann is a professor of law at Suffolk University Law School in Boston.

He is an active mediator of legal disputes and serves as a distinguished neutral for the

CPR Institute and panels iu Europe and Asia. Professor Golann is the principal author of

MEDIATING LEGAL DISPUTES (2009) and co-author of RESOLVING DISPUTES (2010).

Additional information is available at www.golannadr.com.

 

[2] Marjorie Corman Aaron is a Professor of Clinical Law at the Uuiversity of

Cincinnati College of Law and Director of its Center for Practice. Also a mediator and

arbitrator based in Cincinnati, Ohio, she was formerly Executive Director of the Program

on Negotiation at Harvard Law School and Vice President and Senior Mediator at

Endispute, Inc. Ms. Aaron received a B.A. from Princeton University and a J.D. from

Harvard Law School. She is the co-author of MEDIATING LEGAL DISPUTES (2009), from

which this chapter is drawn.

 

[3] Some commentators believe that for a mediator ever to evaluate raises ethical questions. For example, the Standards of Conduct for Mediators promulgated by the American Arbitration Association and the American Bar Association, state that “A mediator shall conduct the mediation fairly, diligently and in a manner consistent with the

principle of self-determination by the parties.” The ABA/AAA standards do not say explicitly whether or not mediators are allowed to evaluate, but the commentary to them states that “Mixing the role of a mediator and the role of a professional advising a client is problematic … A mediator should, therefore,refrain from providing professional advice” and refers to the option of sending parties outside the process for a “neutral evaluation.” For an interesting discussion of the practice-ot~law issue, see Carrie Menkel-Meadow,  Is Mediation The Practice of Law?; Bruce Meyerson, Lawyers Who Mediate Are Not Practicing Law, 14 ALTERNATIVES 57,74 (June 1996).

 

[4] These findings are consistent with the results of a long series of experiments showing that the roles people adopt in both litigation and non-litigation contexts often impair their ability to analyze data accurately. See, for example, Max. H. Bazerman, Negotiator Judgment: A Critical Look at the Rationality Assumption, 27 AM. BEHAV, SCI. 211,220-22 (1983)

 

[5] For a discussion of these and other barriers and specific strategies to address them, see GOLANN ET AL., MEDIATING LEGAL DISPUTES (2009)

[6] For a discussion of other psychological forces that can distort a litigant’s assessment of the legal merits, and  methods to deal with them other than evaluation see id.

[7] Our apologies to, Roger Fisher and William Ury, the inventors of the concept of Best Alternative to a Negotiated Agreement, or “BATNA.” See R. FISHER, W. URY AND B. PATTON, GETTING TO YES (1991) pp. 97-106.

 

[8] For example, the model agreement developed by the CPR Institute of Dispute Resolution requires that all parties assent before an evaluation can be given, but the standard JAMS agreement leaves the issue to the mediator. The American Arbitration Association has no specific rule on the subject, but as noted in note 3 the ABA/AAAA STANDARDS OF CONDUCT FOR MEDIATORS can be read to define “neutral evaluation” as a process separate from mediation.

 

 

[9] The exception, of course, is the process known as “med-arb,” in which the disputants consent to have the mediator render a binding decision if they cannot reach agreement.

 

 

[10] One possible solution is for the mediator to disclose that his or her assessment rests in part on “secret ammunition” confided by one side. Among other things, this makes it easier for each party to understand the neutrals opinion.

 

 

[11] For an explanation of how decision analysis can be used in mediation, see Marjorie C. Aaron, The Value of Decision Analysis in Mediation Practice, II NEGOTIATION J. 123 (1995); M. C. AARON, Chapter 8 in MEDIATING LEGAL DISPUTES, supra n, 3

 

 

[12] The essence of a “mediator’s proposal” is that the mediator proposes the same package of settlement terms to all sides, but under the ground rule that each side can tell the mediator in confidence whether the package is acceptable. If so, there is a deal. If not, the rejecting party will never learn whether its adversary was willing to compromise. This mediation process. format makes it easier for a party to explore a compromise without endangering its bargaining position if an agreement is not reached.

 

 

by Dwight Golann and Marjorie Corman Aaron – 2010