Wednesday, November 18, 2015

Another Reason to Love Construction Mediation (Read: Why Mediation Works)

English: mediator Deutsch: Mediator

English: mediator Deutsch: Mediator (Photo credit: Wikipedia)

I’ll bet you’re thinking by now that I have beaten the mediation drum to death and that I wouldn’t have any more praise for the process than I have heaped upon it here at this corner of the construction law “blawgosphere.”  Well, just about every time I am involved with the process, whether acting in my capacity as a Virginia Supreme Court certified mediator, or as counsel to a client seeking to resolve a matter and move on with the business of making money, I become more convinced that mediation can work in even the most contentious of situations.

What do I mean by “work?”  The obvious answer is that mediation “works” when the parties come up with a solution to their problem.  In most instances, the solution involves money changing hands.  After all, it is money that is usually the tangible and outwardly driving force behind a dispute.  Money is also what a court or arbitrator (in most cases) will be awarding to one side or the other at the end of what is likely to be an expensive process.

However, often money is far from the only driver of a dispute.  Whether it be a feeling of being slighted or a lack of communication that caused friction, the parties most likely have other “grievances” that need to be worked out.  In contrast to litigation where many of these non-monetary and non-contractual issues would be considered irrelevant, in mediation the parties get to “vent” and air their thoughts on these less tangible issues.  A good mediator encourages this sort of back and forth and knows that if these issues can be worked out, settlement can also be achieved.

Another driver for a monetary dispute can quite frankly be that money got tight and one party may be unable to pay the other as required by the contract.  In court (aside from in bankruptcy court), the inability to pay is not an excuse and not relevant.  In the “real world” this fact is highly relevant because a judgment is only as good as the ability to collect it.  The mediation process also can and should take this fact into account and allow the parties to be creative to get past this hurdle.

Finally, even where the parties don’t walk out of a mediation with a settlement, the issues raised in the confidential confines of a mediation can lead to a settlement.  On more than one occasion I have left a mediation without a settlement document only to have the parties continue the momentum and settle the case.  Just working through the process is a helpful exercise that moves the parties toward a better business solution.  This is another way that mediation “works” for those in the zero sum world of construction.

To wrap this up, construction mediation should always be considered as a way to resolve a dispute because it is more flexible, less expensive, and allows the parties to find a business solution to their dispute.

Do you have any mediation experiences to share?  If so, please comment below.

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