Advantages and Disadvantages of Mediation

Terms:

Equitable Relief:
Rather than awarding money, in some circumstances a court can award equitable relief which means the court can order a party to act, or forbear from acting, in a certain way (e.g., order a manufacturer to stop letting harmful chemicals seep into the ground water near the plant).

Pecuniary Damages:
The amount of money which a party may be awarded if she wins a suit. Pecuniary damages can be further classified into general damages, punitive damage, special damages, consequential damages, etc.

So if mediation follows no set procedure, results in no assured outcome, and cannot compel parties to agree unless those parties wish to do so, what advantages are there to mediation?

  1. Mediation is relatively inexpensive. Seeing a case through trial is an expensive proposition.
  2. Mediation is relatively swift. There is no dearth of mediators ready and willing to assist parties whose goal is to try to settle a matter. A quick web search will result in hundreds of mediators and mediation websites, some specializing in certain types of cases and some more experienced and able than others. Mediation does not run by a clogged court schedule and sessions can be easily scheduled any time at the mutual convenience of the parties and the mediator, and can take place in a variety of locations.
  3. Mediation is relatively simple. There are no complex procedural or evidentiary rules which must be followed. While most would agree that a general rule of fairness applies, the maximum penalty a party can impose for foul play is to walk away from the mediation and take his chances in court.
  4. Mediation allows the parties to revise and adjust the scope of their conflict. In a trial, initial pleadings and rules of procedure limit the issues which a party can raise. In mediation, as circumstances change so can the topics up for discussion. This increased flexibility makes it easier for negotiators to act as problem-solvers instead of adversaries.
  5. Mediation allows for flexible solutions and settlements. The relief available in court is usually based on pecuniary damages, and equitable relief is hard to come by. In mediation, however, the parties can agree to a settlement requiring, or restraining, action by one party which was not originally envisioned as something beneficial to the other party.
  6. Settlements reached in mediation are more agreeable to both parties than court judgments. Because any settlement arrived at through negotiation is necessarily agreed to voluntarily by both parties, obligations under the agreement are more likely to be fulfilled than obligations imposed by a court.

This list is by no means exhaustive, but at least presents a framework in which we can consider the advantages of mediation. In addition, there is a similar list which can be constructed in which we can start to consider some of the typically mentioned disadvantages of mediation.

  1. Mediation does not always result in a settlement agreement. Parties might spend their time and money in mediation only to find that they must have their case settled for them by a court. Opting for mediation, therefore, presents something of a risk. Further, if mediation fails, much of a party’s “ammunition” might have already been exposed to the opposing party, thereby becoming far less useful in the ensuing trial.
  2. Mediation lacks the procedural and constitutional protections guaranteed by the federal and state courts. The lack of formality in mediation could be a benefit, as noted above, or a detriment. Mediation between parties of disparate levels of sophistication and power, and who have disparate amounts of resources available, might result in an inequitable settlement as the less-well positioned party is overwhelmed and unprotected.
  3. Legal precedent cannot be set in mediation. Many discrimination cases, among others, are brought with the intention of not only securing satisfaction for the named plaintiff, but also with the hope of setting a new legal precedent which will have a broader social impact. These cases are only “successful” if a high court (usually the United States Supreme Court) hands down a favorable decision on the main issue. Mediation is therefore not beneficial for such cases.
  4. Mediation has no formal discovery process. If one of the parties to a dispute cannot fully address the case without first receiving information from the other party, there is no way to compel disclosure of such information. The party seeking disclosure must rely instead on the other party’s good faith, which may or may not be enough.

So is mediation a good thing? Should you encourage a client to mediate a matter rather than litigate? The answers to these questions depend on which of the various advantages and disadvantages of mediation apply in any given case.

EXAMPLE 1: Nora is a long-time client of the firm for which you work. Most of her legal issues revolve around the family-owned bakery which she inherited from her father and which, with her at the helm, has grown substantially in recent years. Unfortunately, spending so much energy on her business leaves Nora little time to tend to her own affairs. As a result, she has failed to pay rent on her house for quite some time and is being sued by her landlord. Nonpayment of rent is a clear breach of the lease, and if the landlord is able to prove in court that his story is true (and it is), he will be able to force Nora out of the house. Because Nora is very likely to lose the house if the case goes to trial, and because she very much wants to stay in the house which she has rented and lived in for the past 5 years, mediation (if agreed to by the landlord) is an excellent option. The landlord is too angry at present to respond to direct negotiation, and the presence of a neutral party might help Nora and her landlord arrive at an agreement. Perhaps arranging for automated payment of future rent along with a one-time payment to cover back rent with a substantial compensatory fee to cover attorney’s fees, interest, etc. would be agreeable to the landlord. This would still be less expensive than the cost to Nora of paying a real estate broker (tenant’s pay fees in her state) and hiring movers to pack her very large, very fragile collection of antique glass cats.

EXAMPLE 2: Nora’s brother, Sam, is not involved in the family business. In fact, he’s not involved in any business, but instead lives a frugal life, temporarily residing at the house of whichever friend or sibling will endure his snoring for the time. One day he is walking down the street when a large chunk of iron falls and hits him on the head. Nobody seems to know how or why the metal fell, although the company which occupies the building claims it wasn’t their fault, and that the construction signs they placed on the sidewalk should have given Sam enough notice to steer clear of the area. Even while in the hospital, Sam is already thinking about a lawsuit, and Nora gives him the name of your firm. Robert, the attorney who is assigned Sam’s case, is considering asking the defendant if they would like to enter into mediation, hoping to bring this case to a swift end. Fortunately, you are there to point out that without compulsory discovery it will be impossible to show that the company had a poor safety training program or other important facts which would hopefully be gathered through the discovery process, which is available in a trial.

©2005 - 2014 National Paralegal College / National Juris University