GUEST-POST PART II | Questions Clients Have about Mediation: What are the Advantages and Disadvantages of Mediation?

By Kent B. Scott and Cody W. Wilson

Clients always want to know the advantages and disadvantages of mediation. Without this information it would be difficult to decide whether to mediate. Here is a brief list of mediation’s main advantages.

• Little discovery is needed. Mediation can take place without having to complete the time-consuming and expensive “discovery process” associated with litigation. (In discovery, the parties can ask each other to produce any document or information that could be relevant to the dispute.) In mediation, the parties agree to exchange the important documents that support each side’s case. Therefore, this process is also more cooperative than litigation.

• There are no motions. Motions are not filed in mediation. This means that the lawyers need not spend time writing legal memoranda in support of motions. This makes mediation much less expensive than litigation or arbitration.

• Mediation is private. Mediation is considered a private process. This means that the dispute can remain out of the public eye. It can be embarrassing and disruptive of business when customers or suppliers learn that a company is involved in litigation. So keeping disputes a private matter can be very important to a company.

• Mediation is easier to schedule. The scheduling of mediation is not dependent on the court’s calendar. As a result, mediation can take place whenever the parties are ready and the attorneys and the mediator have the time available.

• Mediation produces a faster result. Mediation is usually the fastest way to resolve a dispute because procedures associated with litigation are not imported into the process. This enables the parties to more quickly put the dispute behind them and get on with their business and their lives.

• Mediation makes more productive use of resources. In mediation, the client’s resources are focused on resolving the dispute as opposed to building armaments of evidence to buttress legal and factual positions.

• Mediation can preserve business relationships. Mediation is less adversarial than litigation or arbitration, so the parties often can salvage their relationships. Often the parties to mediation find themselves doing business again.

• Mediation allows the parties to vent and tell their stories. Mediation is the only process in which each party has an opportunity to tell the adversary its side of the story. The parties can also vent their true feelings to the mediator in private sessions.

Disadvantages of Mediation

Are there disadvantages to mediation? We think it is fair to say that any disadvantages are minor.

One concern some clients have is that if mediation fails to resolve the dispute, they will have wasted time and resources. But the counter-argument to this is that mediation has a very high success rate (said to be around 80%), so the risk is usually worth taking.

Also countering this concern is the fact that mediation can be worthwhile even when it does not result in a complete settlement. The reasons are that during mediation the parties can see the other side’s point of view, learn the strengths and weaknesses of both sides’ case, narrow the issues in dispute, or even reach a partial settlement. Mediation can also help counsel identify the discovery that needs to be undertaken. One day of mediation can save counsel days of probing deposition time.

Some attorneys and clients express concern that mediation provides too much discovery to the adversary or that the adversary is willing to mediate only because it can obtain “free discovery.” We believe this concern is largely unfounded because the information voluntarily shared in mediation usually would be produced in response to a discovery request in litigation.

Finally, attorneys who have little or no experience with mediation fear that their litigation or arbitration strategy will be compromised by mediation. This is where it helps to have an attorney who is experienced in mediation. The mediator is not empowered to require the disclosure of any facts, law or legal strategy. And a litigator experienced in mediation will know how much, if any, strategy to share, since that is in the attorney’s control.

In general, the advantages of mediation outweigh these perceived disadvantages. Mediation has the most upside potential for both sides than any other dispute resolution process (except possibly unassisted negotiation) because it is the only one that puts the outcome in the parties’ hands.

Part III will discuss mediation confidentiality. Stay tuned.

[Ed. note: the contents of this post were first published on a different form in the May/July 2008 Edition of the AAA Dispute Resolution Journal.]

Kent B. Scott is a shareholder in the law firm of Babcock Scott & Babcock in Salt Lake City whose practice focuses on the prevention and resolution of construction disputes. As a mediator and arbitrator, Mr. Scott currently serves on the AAA’s panel of mediators and the AAA’s Large Complex Construction Case Panel. He also serves on the arbitration and mediation panels for the U.S. District Courts (District of Utah), State District Court (Utah) and Utah Dispute Resolution. Mr. Scott is a founding member of the Dispute Resolution Section of the Utah Bar and a Trustee for the Utah Council on Conflict Resolution.

Cody W. Wilson is an associate in the law firm of Babcock Scott & Babcock, concentrating his practice in the area of construction law, is licensed in all courts in the State of Utah, the U.S. District Court of Utah, the 10th Circuit Court of Appeals, the U.S. Court of Federal Claims and is a member of the ABA Forum on the Construction Industry. They can be reached at kent@babcockscott.com and cody@babcockscott.com.