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Proposal For Settlement and Mediation; Part II: More Tactical Suggestions

February 28, 2012

You already know my feelings about the close kinship between your mediation success and your wise use of proposals for settlement.  See,Proposal For Settlement and Mediation; Part I: Negotiation and Timing Goals“,  February 20, 2012.

(And, if you still have any doubt about the many effective uses that are presently legally permissible with a proper and timely proposal for settlement, you might want to review McGregor v. Molnar, et al.,, a recent case just reported February 17, 2012, out of the Second District Court of Appeals (I had no other better citation available at printing).  It  provides an excellent and timely review of the reason for the law and rule and the many and varied tactical uses for these procedures.)

I am convinced by repetitive observations of successful mediations that your use of the present proposal for settlement law and procedure, in combination with careful mediation planning, will dramatically increase your odds of avoiding the necessity of trial to resolve your dispute.

Accordingly, I offer some additional tactical suggestions for your consideration as Part II, of this three-part series, regarding combining mediation and the proposal for settlement to increase your mediation success.

First, both sides, plaintiff and defense, should use proposals for settlement, often and early.

At the worst, every proposal you make forces you to evaluate and consider (or re-consider) what  your “likely” outcome will  be if your dispute must be tried on the facts and law you presently believe apply.  At the best, it also forces your opposition to do the same!

For me, the most important initial consideration for any successful negotiation of any kind is for both sides to candidly estimate their likely future outcome by trial.  See, Rule One:  Know Your Alternative(s) Should Mediation Be Unsuccessful.”  December 19, 2010.

Further, statistically (and strangely?), the party who serves the first proposal for settlement in the typical dispute almost never has it accepted!  One suggested reason for such inaction is that the opposition almost always assumes a better offer will be forthcoming in the future. ( Or,  are they simply not prepared to make a valid recommendation to their clients about acceptance?)

And, of course, in matters in which the damages are liquidated, although obtaining your client’s agreement for a meaningful discount may seem difficult early in litigation.  You can be reasonably certain, as your fees and cost increase, obtaining a similar discount will only become more difficult.

Regardless, what better opportunity to present a proposal as near to your bottom line as you will ever be able to propose in the future?  Your clients fees and costs are at their lowest.  And, of course, the earlier your proposal, the greater the benefit,  your opposition paying your ongoing fees and costs, should you prevail under the procedure at trial.

However, even if your first proposal is later determined to require modification by your own analysis of facts and law that have changed,  your first proposal will always remain as a valid concern for your opposition who, of course, also cannot predict the future.

Second, if you haven’t previously sent at least an initial letter outlining the damages (exposure) of your claim or defenses to your opponent (a recommended basic of the personal injury practice for establishing either reserves or claimant’s expectations),  consider your use of an early proposal for settlement instead to gain their attention (and force them to set their reserves and/or review the defenses ).

If your internal argument is that you do not yet have a basis for such a proposal, ask yourself why not?  What measurement did you use to accept the claim or defense?  Or, to file suit or any defense?  Whatever your answer, it is now time to evaluate your client’s likely future at trial.

And, I also can think of nothing lost by an early and objective appraisal of your claim(s) or your defense(s).  However, I know, with certainty and years of experience, that much is lost if such an appraisal is delayed.

Third, if not already utilized, take the earliest possible initiative to notice your case for trial.

Then, always, always,  accompany your trial date request with your proposal for settlement.  Or, consider proposing a slightly better one than prior served (unless your best one was your first?)

The significance of this “double-whammy” of service of your trial notice and proposal for settlement concurrently is that not only are you telling your opposition that you are ready for trial, but you are also stating, clearly and with conviction, the present amount at which, if they move expeditiously, can immediately resolve the matter without trial!

When your opposition then reports to their respective client(s), as they now must, they have TWO messages to convey; “we are now scheduled for trial unless a settlement is reached and here is the cost of resolution, presently, before spending more”.

Alternatively, if your opposition (or the Court) has taken this tactical step before you, as soon as you get your opposition’s (or the Court’s) notice of a trial  date , immediately present your own proposal for settlement to achieve the same double whammy effect.

And, yes, if yours is first, you will likely get your opposition’s proposal back.  But what better way, again, to get parties actually thinking and talking about resolution!  (And, by the way, “forcing” them to evaluate or re-evaluate their own position!)   Again, they cannot realistically make any proposals without such an evaluation.

(I firmly believe that, except in rare disputes, a trial date is the only thing that will bring the emphasis and immediacy that is normally required for voluntary resolution for most litigation.  Even good attorneys need a push now and then.  And, clients need to know their day in court is finally scheduled.)

And, if you (or your opponent) have effectively told the court you are “ready for trial”, one requirement for requesting the trial date,  presumptively by now you should have some idea of your most likely outcome at trial.  If you do not,  then catch up, and quickly!

Equally important, however, the costs of your litigation is now going to increase at a much faster rate than ever before.  You are thus likely to be able to offer or accept the best settlement opportunity you will be able to offer or accept at any time in the future!

Fourth, at a “second minimum”, make sure you have your “close to best” proposal out just greater than sixty days prior to your (first) mediation.  I say “close to best” because we all know that until we really “hear” the opponent at mediation, we (and certainly our clients) often over-evaluate our own position and denigrate the oppositions.  Again, however, by now you simply must have had several assessments and re-assessments of your client’s position prospect if the matter must be tried and it is time to be “very close” or be wasting your time.

Fifth.   Always try to leave yourself enough time to serve a “final proposal” should your “final” mediation fail.

Generically, if you have but one scheduling choice, and likely, only one mediation opportunity,  a mediation about 60 days prior to your “final” trial date is probably about as optimal as you can get.  (But, note:  Early mediations and multiple mediations have their very valuable uses.)  See, also,Mediation Strategy: Timing The Scheduling Of Your Mediation, January 28, 2012.

But, Sixth, regardless of any possible failure of the technicality of your proposal and how many days your mediation is scheduled before your trial period, ALWAYS follow-up any “final” failed mediation with your “really best” proposal.

As we previously discussed, if you are indeed at your final resolution mediation, there is really nothing to be gained by withholding your very best offer,and thus your best proposal.  See, Proposal for Settlement and Mediation; Part I:  Negotiation and Timing Goals“,  Supra.

At worst, if there is insufficient time for your last, best proposal to take effect, your last proposal will not become effective.  But, the odds are quite good that something will delay ANY trial and any delay may suddenly make YOUR last proposal a very powerful weapon.  Particularly if your opponent did not bother!

But, if you are following my reasoning (and repetitive and objective evaluations necessary to use these suggestions), you already have at least one “pretty good one “ (or more) that could become valid if your early assessments were valid.

And, never under-estimate the number of cases that settle because someone suddenly decides that “last, best offer” really wasn’t so bad after all, even if it would not be “legally” effective.

Sometimes it is merely the forceful repetition of your offers and the sincerity and thought that is required for each that finally convinces your opposition to seek to end the dispute.

But, what is the repetitive and direct connection of each and all of these tactical efforts of proposals for settlement and  mediation?

Simple.  The more your evaluate your current fact and law position, the more confidence in your trial outcome evaluation you achieve.  The more confident you are in your evaluation of what will likely occur at trial, the more confidence you have in your “bottom line” for voluntary resolution.  And, the more confident you are on your bottom line for resolution, the more confident you will be in your negotiation strategies.  And those who are confident in their negotiation almost always resolve their disputes at mediation.

I firmly believe there is a direct connection between the wise use of proposals for settlement and mediation (or even pre-mediation) success.

If you haven’t been using some of these tactics, try some or all of them.  You might just be pleasantly surprised at your success at mediation, or at least resolution without the necessity for trial.

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