This is the first of a two-part interview. The second half will run in the July 11 edition.
Jeff Kichaven asked me a disturbing question: “Are we doing it right?”
Jeff is a well-known mediator in California. He’s beginning to doubt whether “caucus-only” is the best method of mediation. He wonders whether it’s even ethical.
Most mediators have seen lawyers who expect them to act as their negotiator. That’s contrary to our role. Consider other neutrals like judges. Judges clearly cannot care who wins. Imagine a trial lawyer depending on a judge’s favor to win a case. Sure, you don’t mind being the beneficiary of an unexpected ruling. But how do you feel when you’re on the other end?
Mediators do best when they don’t try to determine the outcome of a negotiation. It’s the parties’ decision and whether the parties want to make or take an offer is strictly up to them. Whether they want to make a deal or try the case must always be their decision. Mediators should have no loyalty to one or the other side. They have no fiduciary duty to either party. The more mediators begin to care about the result, the less effective they become because they are comingling their own interests with the parties’ interests.
Mediators can question, point out, probe, guide, examine, counsel, recommend, ask, suggest, cast doubt, discuss, encourage, discourage, analyze, reference, or project scenarios. Maybe they can sometimes “urge,” “push,” “implore,” “advocate a position” or “beseech.” Most would agree mediators should not insist, compel, goad, admonish, mock, exhort, demand, lecture, pontificate or threaten. A mediator is not a judge and a mediator is not a party’s negotiator.
Jeff had more to say. “When you have a caucus-only style of mediation where the mediator is the only one talking face to face to opposing counsel, is the mediator facilitating the negotiation, or negotiating for you? Engaging in negotiations with opposing counsel is the practice of law. In California, there's a case called Morgan v. State Bar, 51 Cal.3d 598 (1990). It has to do with unauthorized practice of law. There is a statement in there, ‘we conclude that engaging in negotiations with opposing counsel concerning settlement constitutes the practice of law.’ When a client comes to a lawyer and hires a lawyer to perform professional services for them, the client comes to that representation with the idea that the services are going to be performed by a lawyer. Their lawyer.
“That means the client expects the services to be performed by a person with a duty of undivided loyalty to them, a person with a fiduciary obligation to them, including, as the California Supreme Court found in the Morgan case, conducting settlement negotiations with opposing counsel.
“So let's say you're in a caucus, and a defense lawyer says to a mediator, ‘Go down the hall and tell them that our next offer is X,’ and the mediator goes down the hall and tells the plaintiff that the defense is offering X. The plaintiff's lawyer has a conversation with the mediator and the plaintiff's lawyer says to the mediator, ‘Go down the hall and tell them that our next demand is Y.’
“The mediator is the only one actually communicating with opposing counsel. So the question really is, who is conducting the negotiation on behalf of the client? Because the mediator is in all likelihood not only simply stating a number and sitting silent—the mediator is also trying to raise doubt and dissonance, trying to be persuasive, trying to direct people towards settlement to one degree or another.
“Many of the things that mediators do to try to catalyze settlement can be construed as conducting the negotiation. The problem is that the client has entrusted a lawyer to conduct the negotiation. The client has entrusted a person with a fiduciary obligation, with a duty of undivided loyalty, but here, the lawyer has delegated responsibility for conducting the negotiation to the mediator—a person who does not have a duty of undivided loyalty or a fiduciary obligation.
“At a certain point, you cross the boundary to where the lawyer is failing to perform professional services competently for that client because the lawyer has delegated too much responsibility to the mediator to conduct the negotiation on their behalf, not merely to facilitate a negotiation in which the lawyer retains the responsibility for negotiating on behalf of the client. While lawyers can delegate responsibilities to others who are not their clients’ lawyers—such as paralegals—the lawyers must always supervise those others and remain in charge of the representation. The way it works in many mediations, though, with mediators commandeering the action, the question arises: is the lawyer still in charge? Who is supervising whom?”
Jeff isn’t against caucusing. He simply thinks face-to-face meetings are often necessary. Jeff thinks there can be an ethical obligation on the part of the lawyers to do so.
In addition to the ethical need to be the negotiator, face-to-face is useful for practical reasons, too. Sometimes the clients need to hear the bad news directly from their opponents.
“Let's say the plaintiff is overconfident in their case. If they sit in a joint session and hear a few words, hopefully not too adversarial, not too antagonistic from the defense counsel about why the defense thinks they're going to win the case, you can then go into a caucus and have a conversation with the plaintiff's lawyer in the presence of the plaintiff about what the defense lawyer had to say. Hopefully, the plaintiff ‘gets it’ from listening in on the conversation between her own lawyer and the mediator. It becomes illuminated to the client that maybe there really are two sides to the story. It's a way the pieces of the mediation fit together so that you allow an overconfident party to draw their own conclusion from what they see and hear rather than trying to beat somebody over the head.”