Let's start with defining what mediation is (and what it isn't). Mediation is a process that takes place in many legal proceedings where the parties sit down with a neutral third person (the mediator) and attempt to reach a resolution of their dispute. Unlike trial, where the judge or jury will decide the case, mediation will not definitively resolve a case unless the parties choose to reach an agreement. While the mediator will have ideas about how the case should be resolved, the mediator does not ultimately make a ruling. Rather, the mediator simply facilitates the parties reaching a resolution.
Why do parties go to mediation? First, mediation is required by the courts before trial in most civil cases. So, going to mediation may be a necessary step in the litigation process. Second, mediation may be a prerequisite to legal action under a contract (or other binding document) between the parties. Third, reaching a settlement at mediation will allow the parties to avoid the expense and uncertainty of taking a case all the way to trial. Thus, resolving a dispute at mediation can be cost-effective and practical even for a party that is likely to win at trial.
Who is the mediator? In limited situations, the court may require the parties to meet with a particular court mediator. In many other situations, it is up to the parties to decide who they want to be their private mediator. There is no formal training required to be a private mediator, although many mediators do receive training in dispute resolution. Mediators are often retired judges or other experienced attorneys. Choosing a mediator can be a function of (1) what mediators are available in the area and whether they are available at a convenient time; (2) the type of case (given that some mediators have experience in certain areas of law); (3) the experience of the parties' attorneys with different mediators (or what they hear about a given mediator's reputation); and (4) the mediator's fees.
How much does mediation cost? Private mediators typically charge $100-400 per hour with the fee split between the sides of the case (plaintiff side and defense side). Mediators may charge extra for preparation or travel. Mediation of a simple case might take a few hours and of a more complicated case more than a day. It is not uncommon for a mediation to take longer than originally scheduled.
How does mediation work? Each mediator has his or her own style. In most situations, the parties will communicate with the mediator separately before the mediation providing background on the case and their view of how it should be settled. Any communications with a mediator are confidential; they will not be disclosed by the mediator to the other side without permission (and what happens at mediation may not be brought up in court). Some or all of a mediation may be conducted with the parties face-to-face, but the mediator will usually at some point meet with the parties privately. The mediator will then go back and forth (this is called "shuttle diplomacy") learning about the case, narrowing the issues and trying to bring about a settlement. One way or other, the mediator will try to get the parties to think realistically about the case and will engage in some degree of "arm twisting."
Mediation is at heart just like any other business negotiation. It requires each party to assimilate imperfect information about their case and make a decision about settlement based on potential outcomes. A skilled attorney can help navigate this process and achieve a favorable result.
Noah Klug is principal of The Klug Law Firm, LLC, in Summit County, Colorado, emphasizing real estate, business, and litigation. He may be reached at (970) 468-4953 or Noah@TheKlugLawFirm.com.