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This space is often the venue for paeans to alternate dispute resolution, especially mediation, as a prudent relief from litigation and trials. Some columnists have even used the phrase “the magic of mediation.” But what about the times when the magic fails, when the rabbit fails to emerge from the hat and the smiling assistant remains sawn in two? I spend a lot of time thinking about those few cases (maybe one in 10, in my experience as a mediator) that have failed to settle in mediation. What was it that kept the parties from reaching resolution? Was there something inherently different about these cases? Was it something about the particular parties or lawyers, or (gasp) something about my techniques as a mediator that accounts for the failure of these cases to succumb to the vaunted magical impulse to end the dispute? The failures aren’t predictable. A case about sexual abuse that appears likely to be intractable because of disputed insurance coverage settles nice as pie in a couple of hours. A medical malpractice case with clear liability and a reasonable demand fails to settle even with the insurer’s representative present. The size of the case doesn’t seem to be a good predictor, nor does the age of the case nor even the subject matter My attempt to figure out why some cases are immune to the mediation magic is a work in progress, but I’ve identified a few factors that distinguish the cases that aren’t resolved in mediation proceedings from those that are. My observation is that the greatest number of failed mediations are the result of the internal procedures of many insurance companies. Adjusters are accorded various ranges of authority. Some adjusters, for example, can’t make an offer above $30,000 without approval from a higher-up, while other adjusters have authority to settle even above the policy limits. When the insurer sends an adjuster with a low level of authority to the mediation of a case with potentially high exposure, the mediation can founder because the real player is just a voice on the telephone, who may or may not be giving full attention to the case and its nuances. Such a situation makes plaintiffs reluctant to bargain in earnest and sometimes makes them walk out in disgust. Oddly, defense counsel are sometimes as surprised as their opponents that the adjuster who has come to the mediation has a limited capacity to participate in real negotiation. While the presence of an under-authorized insurance adjuster may be frustrating, there is frequently good news in the aftermath. Very often, cases that can’t be resolved at the mediation itself because the insurance adjuster has inadequate authority settle a few weeks or months later, and the mediation at least serves to help the discussion get started with some input from a neutral evaluator. Another distinguishing characteristic of cases that fail in mediation is prematurity. Prematurity comes in several varieties. Sometimes, one side realizes part way through the discussions that it really doesn’t know enough about the facts or the law to make an accurate assessment of the likelihood of prevailing. Or a crucial piece of information is missing and both sides are bargaining on the basis of conflicting assumptions. Or the client isn’t ready because he or she hasn’t really formulated a bottom line position and suddenly feels rushed to make a decision without sufficient preparation. Or one or more of the parties is still reacting from emotion rather than from reason. Yet another harbinger of failure is excessive certainty on the part of one of the lawyers present. Some counsel behave as though the purpose of attending a mediation is to coerce the mediator into bludgeoning the opposition into accepting a predetermined settlement figure. Not surprisingly, when a party sees no plausible version of the facts or the law other than favorable ones or adopts a take-it-or-leave-it position from the start, mediation doesn’t have a chance. And just once I’ve encountered a situation that is blessedly likely to remain rare: both sides in a land dispute had so much money, so much hubris, and so much ability to inflict pain on each other that they didn’t even care about what might happen at trial. Beverly Hodgson, a former Superior Court judge, is an arbitrator and mediator with the ADR Center, Mediation Consultants LLC, and the American Arbitration Association.

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