By Elle Belekas -
Mediation offers a setting for resolving disputes more cordially and more flexibly than in the courtroom. Mediation is a consensual process, enabling parties to exert greater control over the outcome.
This poses an enigmatic question – what will be an effective outcome? As many mediators will emphasise at the outset, mediation will not have served its purpose if a party exits the door with their “wish list” granted. In other words, mediation requires parties to compromise. The beauty of mediation is, unlike litigation, all parties are, in a sense, winning parties. At the very least, the outcome should be sufficiently palatable for all parties to live with.
It can be challenging to strike an appropriate balance between maintaining fidelity to, and robustly advancing, a client’s cause and achieving a commercial outcome (i.e settlement) at a mediation. Navigating this requires the formulation of a negotiation strategy informed by a realistic risk assessment. Inevitably, this entails a quantitative analysis of the strengths and weaknesses of each party’s case from a liability standpoint and in respect of an assessment of quantum. This includes weighing up the available evidence (including expert evidence), assessing the credibility of witnesses and acknowledging the possible grey areas that may underpin an unfavourable outcome if the matter is litigated.
Factors to consider in mediation
Qualitative factors are also critical. These may include an interest in preserving a commercial relationship between the parties, or otherwise avoiding rapidly accruing legal and expert fees, detrimental reputational repercussions of the matter being heard (publicly) in the courtroom, risk of an adverse costs order in the event of an unfavourable judicial outcome, or even possible difficulties with costs recovery in the alternative scenario of success.
One ought to consider: How will the client feel if the matter does not resolve at mediation? Will the client be okay to litigate with these risks in mind? By undertaking a thorough risk assessment, keeping clients’ expectations within realistic parameters becomes a little easier. A client will not be able to ascertain an appropriate “bottom line” nor will they be in a position to properly evaluate an offer put before them unless they can properly understand the risks of their case and the alternative available avenues (and outcomes) if the mediation were to fall away.
As litigators, we carry the risk of falling into a fruitless vacuum as stars of our own courtroom television drama, instinctively leaning into an acrimonious defence position and vehemently bridling at any suggestion of a deficiency in our case. However, mediation is not a zero-sum game, and demeanour that may be appropriate in a courtroom (e.g standing up and exclaiming “I object” or cross-examining another party) will unlikely be appropriate across a mediation table. When engaging in negotiations at a mediation, adopting an approach that is conducive to our ultimate objective of reaching a mutually acceptable outcome will be most effective. We are afforded an opportunity to, and should, depart from positional bargaining. Taking the opportunity to understand the other parties’ concerns and being persuasive rather than adversarial will more likely facilitate an outcome in line with our client’s best interests. In the same vein, we must be conscious to maintain our professional integrity and remember that being respectful and courteous to other parties is a sign of strength rather than weakness.
Duty under the legislation
A recurring theme in the Civil Procedure Act 2005 (NSW) s 27, mediation agreements, and within broader mediation discourse, is that parties must conduct mediation in “good faith”. The notion of good faith transports us into a complex terrain of mediation ethics, which I will not attempt to discuss here.
However, one element of this concept of “good faith”, which is appropriately guided by the above-discussed risk assessment, is being cognisant to avoid misleading or deceiving other parties by making false assertions about a client’s case or failing to correct a misapprehension by another solicitor. This is an obligation that applies to us as legal practitioners in and outside of mediation and aligns with our paramount duty to the administration of justice (Legal Profession Uniform Law Australian Solicitors’ Conduct Rules 2015 r 22. See also r 4.1.2 and r 3.1).
Ultimately, while mediation may offer an alternative platform for resolving disputes, to mediate effectively, parties must be adequately informed of the risks associated with their own case and be realistic as to what might represent an outcome they would be content to walk away with. However, even more integral to an effective process, and consequently an effective outcome, will be an appreciation of the “non-adversarial” environment offered by mediation and accordingly, the adoption of an appropriate approach and attitude.
