Saturday, March 23, 2013

Use Caution in Meetings Where Lawyer and Client are not in Agreement

It may surprise you to know that not all clients follow their attorney's advice and not all lawyers anticipate non-cooperation from their clients.  Generally, lawyers don't like surprises.  After years of law school and months of handling a particular lawsuit, usually the lawyers believe they know whether it's in their client's best interest to settle the lawsuit and at approximately what level.  This week, I had one such lawsuit which resulted in a mediator's proposal at the end of the sixth hour at a level which both lawyer's indicated they could agree upon.  To the Plaintiff's lawyer's chagrin, his client did not agree.  This took a good deal of diplomacy and consideration to reach an ultimate resolution.  Afterwards, I remarked to the lawyer that I thought she had performed magic by gaining her client's compliance.  She thought it was my explanation that did "the trick".  The dilemma could have been avoided had the client and the lawyer carefully and realistically evaluated the claim and the expenses and risks of not settling before or at the outset of the mediation.  Instead, I spent about an hour conducting that evaluation.  I wrote out the range of values in the event the Plaintiff won a verdict (Hypothetically $75-$100,000).  Then I wrote out the odds of overcoming a Motion for Summary Judgment.  (Hypothetically 50/50).  In the scenario of a 50/50 loss on a motion for summary judgment, the settlement value became $37,500-$50,000.  But I couldn't stop there.  Even overcoming a Motion for Summary Judgment, the attorney and I agreed that Plaintiff had only a 50/50 chance of winning at trial.  This reduced the settlement value to:  $18,750-$25,000.  After I articulated the costs of going forward, which would be recoverable to Defendant if they became the prevailing party (about $5,000), settling the case at something in the range of $13,750-$20,000 became "reasonable).  When I was able to show the Plaintiff that if he settled, he could also be paid that amount within one week, he understood why his lawyer was recommending he accept my proposal. 
     Occasionally, a mediator has to step in to mediate between a lawyer and his client.  Diplomacy is paramount at that moment.