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Mediation, One Discipline or Many?

National Institute for Dispute Resolution Forum

by David Gage and Melinda Ostermeyer
National Institute for Dispute Resolution Forum
June 1997

The authors will address the question of whether mediation is the practice of law, and therefore the sole domain of lawyers, from the perspective of mediation in business disputes. We will describe three business mediation scenarios and discuss what we believe are the ideal professional disciplines of mediators who assisted the parties in resolving their disputes. We will then address the most common objections to non-lawyers as mediators and make a case for an interdisciplinary approach to the question of who should be mediators.

Many writers have noted the importance of considering personal style and orientation when selecting a mediator (e.g., Riskin, 1994). But the issue of which professional disciplines provide the best preparation for mediation is equally important. We believe that by examining different types of business disputes it is easy to see that the particulars of the client’s situation should dictate which professional disciplines are most necessary. Consider the following three business dispute scenarios:

  1. Three people form a corporation after buying a small government contracting company. Their business grows over ten years from $1 million to $25 million. However, their success is not without significant interpersonal stress. Different pairs have been known to go months at a time without speaking to the other partner. For the last two years, one partner has become increasingly dissatisfied. He feels he has put much more time and energy into the company than his partners. He has been unsuccessful in persuading his partners to buy him out of business and allow him to take a small subsidiary with him. Though the company has chosen not to extensively market this subsidiary, he believes it could be the basis for a start-up company. They disagree vehemently on what the business and the subsidiary are worth. Complicating matters further, the partners are in the middle of sensitive and protracted negotiations with the bank over a $1.2 million loan that is technically in default.
  2. A brother and sister are equal owners of a computer consulting company. The brother has two children in the business and the sister has one. One of the brothers’ two children is clearly not performing up to company standards and not nearly as well as his sister or his cousin. Nonetheless, his father insists that all three from the next generation receive equal pay. The issue is hard for any of them to talk about without someone becoming extremely emotional and it is affecting family social gatherings and the business.
  3. The Human Resources Director of an international nonprofit organization is concerned about a conflict that is brewing between two department heads who must work closely together on many large projects. One executive has been with the organization for eight years; the other has nineteen years of tenure. Both executives are considered extremely valuable, capable vice-presidents, but it appears that one of them will leave if the matter goes unresolved. The conflict appears to stem from their different leadership and communication styles and from a varying adherence to organizational rules.

AN INTERDISCIPLINARY APPROACH

We believe that these three scenarios, which are altered versions of real cases, show the importance of an interdisciplinary approach to mediation. For example, in the first scenario, the expertise of a lawyer seems essential. Any agreement will be extremely complex, containing multiple contingencies. The situation also needs the knowledge of an experienced financial professional. Because the partners have a complicated interpersonal history that resulted in distrust and distorted communication patterns, a psychologist’s experience and perspective also seem advantageous. Therefore, the mediation team with the greatest likelihood of success would employ all three types of professionals.

The conflict described in the second scenario is characteristic of the growing pains family businesses experience. Compared to non-family partnerships, deep family ties make family business members struggle much longer to keep partners working together. Resolving family owned business disputes requires an understanding of the three ever-present intersecting systems: family, ownership, and management. An effective mediator team would be a psychologist and a business consultant.

The issue in the third scenario is organizational behavior. This conflict is unencumbered by financial, legal, or ownership issues. A lawyer-mediator could handle this situation but mediators with backgrounds in organizational development and psychology are better prepared to deal with these types of issues and dynamics.

We suggest that different business mediation cases have such different complications and needs that an interdisciplinary team is a necessity, not a luxury. And the best way to serve any given client is to begin by making the type of assessment we just portrayed. In each case, it is the client’s needs that drive the choice of the professional discipline of the mediator (see Figure 1).

But if the client’s needs are driving the choice of the professional discipline of the mediator, what about the assertion that only lawyers should mediate because mediation cannot be practiced properly without giving legal advice, anticipating the pitfalls of an agreement, or drafting agreements?

GIVING ADVICE

Rendering professional or technical interpretations is considered giving advice. It could be very challenging to mediate a dispute without giving advice. But an important distinction must be made between providing advice that does not relate to the merits of one party’s position and advice that has the intended or unintended effect of supporting one party relative to the other. It is the second type of advice-giving that is problematic and amounts to playing the role of an expert advisor.

Whether or not mediators from any discipline give expert advice or evaluations is largely a function of their style and beliefs about how to practice mediation (See Figure 2). Some mediators freely offer their opinions; they would be characterized as “narrowly evaluative” (Leonard Riskin, 1994). These mediators tend to believe that the parties need someone to listen to their dispute in order to tell them what they think they should do.

Other mediators may love to offer opinions, but they believe that mediation is an improper forum in which to do so. People involved in disputes tend to solicit opinions because they want to prove they are right. How better to demonstrate this than by getting another vote in their favor? Parties typically have plenty of innocent (and not so innocent) bystanders who freely offer their opinions.

By giving opinions or evaluations, mediators risk losing what is unique and most valuable about their role, i.e., their neutrality. Arthur Chaykin makes several important points about dispensing this type of advice. He states that mediation “is not always an optimal place for the aggressive pursuit of truth;” meaning that mediators are not in the best position to render such opinions. Once a mediator gives an opinion on the merits “that determination will almost always have a powerful impact on all further negotiations. After all, how could the ‘prevailing party’ take much less than what the mediator recommended” (1994). He also explains that when parties have already been negotiating themselves and need help reconciling their differences, as is typically the case with business partners, then a facilitative mediator is more appropriate than someone who gives advice or evaluations.

The ramifications of giving advice that affects the parties differentially occur whether the mediator is a lawyer, psychologist, financial expert, or business consultant. Accordingly, in the scenario above with the underperforming son, it would be unwise for a psychologist co-mediator to advise the son that he needs to start working harder, even if that is precisely what the psychologist might say if the son were in therapy. By maintaining a facilitative orientation, a mediator can assist the parties to negotiate an outcome in a positive way without advising the parties as individuals.

AVOIDING PITFALLS

As the parties formulate a resolution to a dispute, mediators should help the parties consider the range of pitfalls that could hinder its implementation. It may be important in certain cases to have a lawyer as a co-mediator, so that legal ramifications are taken into account. It is equally important that some cases employ mediators from other disciplines in order to identify non-legal pitfalls that could undermine a long-lasting, workable resolution.

A case in point: consider a recent family-business feud that consumed the services of many lawyers, at a cost of several million dollars. A solo lawyer-mediator was able to get the parties to reach an agreement that was legally sound. However, in this case, as in many other cases, the agreement began unraveling almost the minute after it was signed. We believe that the mediated agreement had failed to sufficiently consider the emotional agenda and the complex family dynamics; those emotions and dynamics undermined the ability of the family members to follow through with the agreement. An agreement has to be realistic from the perspective of the family relationships, as well as the legal requirements. Even now, two years later, the battle continues on in multiple courts.

Whether or not these family members could have reached a long-lasting mediated resolution is debatable. However, attempting to mediate complex business disputes from the confines of any one discipline puts the client at an unfair disadvantage. Having a background in one of the core disciplines is necessary, but, unfortunately, not always enough. Gerry LeVan expressed it best in a speech given in 1994 at the Annual Conference of the Family Firm Institute: “A little learning can be a very dangerous thing if you are working in a family business. A lot of learning in a single discipline is simply not enough.”

AGREEMENT WRITING

Lawyer-mediators are obviously well-trained to draft any necessary and final agreements reached during mediation. However, there is a very real difference between helping parties negotiate a resolution or agreement and writing a final document which memorializes the understanding between the parties. To assist in reaching an agreement–which is what mediation is–a lawyer-mediator may or may not be necessary. To put the understanding of the parties into a final document or contract which will then guide their future interactions, it may be necessary to use a lawyer. The lawyer who writes the final contract though, does not necessarily have to be one of the co-mediators.

Legal counsel for the business may be involved in the mediation and is sometimes asked by the parties to review a potential agreement and advise the principals regarding its legal validity and enforceability. Alternatively, each principal could engage independent counsel to review a proposed agreement. In addition, the principals could employ the services of a lawyer-mediator who was not part of the co-mediation team. In this capacity, the lawyer would play the role of a neutral expert and be charged with advising specifically on the legal soundness of the agreement.

CONCLUSION

It is an oversimplification to frame mediation solely in a legal context, thereby suggesting that all mediators must be lawyers. Family-business owners and business partners expect that their mediators will have a working understanding of the interaction of family and partnership dynamics; ownership, management, and organizational issues; and financial and legal concerns. It is impossible for even the most knowledgeable mediator to have substantive knowledge in all of these areas.

Therefore, an interdisciplinary mediator team capable of dealing with the issues specific to each case is the way to ensure that not only are legal issues considered, but that other, equally important, non-legal issues are considered as well.

Is mediation the practice of law? No. Depending on the context and type of dispute, mediation calls upon the skills and expertise of professionals from many disciplines. Vying for the pre-eminence of one discipline over the other is hardly the way to ensure quality mediation. Working in well-coordinated, interdisciplinary mediator teams is certainly a better way to achieve the highest caliber of service–the standard all mediators are striving to provide.