Mediation | Costs, controlling costs

Family lawyers on the State Bar of Michigan Family Law Listserv (a discussion group) have been discussing mediation this past week. Some lawyers think it's unfair to be billed by a mediator when a mediation is cancelled or rescheduled. Others think it's not fair to be billed for "administrative tasks." I admit that I objected when a GAL agreed upon by the parties billed $150/hour for sending a form letter to the parties. I'd feel the same way if I were billed $150/hour for the sending of a mediator's notice of mediation.

James J. Harrington III of Novi, www.jjharringtonlaw.com, an outstanding Michigan family lawyer, had some valuable thoughts that he agreed to let me share with you. I concur with his analysis.

"[I'd like to share my thoughts on this discussion] involving attorneys or clients upset at Mediation fees, administrative fees, 'no show' fees and the like.

"By and large my overall experience has been that it is the Mediator who gets “stuck” in the majority of cases for unpaid fees, rather than clients being gouged. Moreover, Mediators get dragged into additional phone calls, or consults, or whatever which are not the subject of additional billings.

"For Mediators who invest large quantities of time and expertise in a volume Mediation practice, the time slots allocated for Mediation can not  be filled when there are last minute cancellations, or “eve of” settlements, or the attorneys “just aren’t ready” for Mediation.  We practitioners always have a ton of stuff to fill our time, so cancelled appointments or last minute settlements never take $$ out of our pockets.  The opposite is true of Mediators, with an empty slot representing lost $$.  If we truly expect Mediators to do what we cannot do --- which is use their expertise and skill to resolve complex and high conflict disputes --- they must be fairly compensated.

"Moreover, cases that are settled by Mediators routinely result in Judgments being entered and the Mediators never paid. One Mediator that I met with last week literally had 100 or more unpaid mediation bills.

"Mediators should be charging for time spent on a case, especially when it settles at the last minute.  It may very well have been the scheduled mediation that triggered the settlement (or the financial disclosures that would have occurred in the Mediation), which means the services of the Mediator played a vital role, whether or not anyone ever showed up in their office.

"Clients should be paying in advance to reserve the time of these competent and skilled professionals.

"Are there exceptions where clients are not treated fairly?  Sure --- but it’s the very very small minority of cases.  It’s usually the other way around.  Mediators should be applauded for their efforts."

I have only one thing to add to Jim's words.  Here in the 13th Circuit (Grand Traverse, Leelanau, and Antrim  Counties), the Court will not enter a judgment until the mediator has been paid. I think that's a good rule. 

Comments

[Zena Zumeta]

I couldn't agree with you more about early mediation, Jeanne. It saves money and relationships. But even here, preparation by the attorney is very helpful. Not so much a summary or even discovery, but preparation of the client for mediation and helping with financial negotiation particularly.

Thanks again for all your great work, Jeanne!

[Jeanne M Hannah]

Dear Mr. Barron:

Thank you for your insightful comments. I agree completely with you. Several things contribute to excessive cost for mediation and failure of mediation. Chief among these is a failure of counsel to prepare adequately for mediation. For me the failure of opposing counsel to provide the client with reasonable expectations is a real aggravation. Recently in local mediations, opposing counsel fails to submit a mediation summary. This makes it difficult for the mediator to get a real grasp of the issues. The message seems clear: I'm a litigator. I want to litigate because it's good for the lawyer. I am not interested in facilitating settlement.

I view early mediation in domestic relations cases as an opportunity to reach a reasonable settlement before the parties destroy their relationship and ability to communicate.

Your article hits the nail on the head. If people are motivated to fairly resolve the issues, mediation can be a most effective settlement tool.

Jeanne M. Hannah

[Richard Morley Barron]

Jeanne,
Jim Harrington is absolutely correct that mediators are rarely paid for all their time and lose money when attorneys cancel on short notice. My experience as a mediator has been that counsel who keep the mediator apprised of developments in their case also keep the cost down, at least when the mediator is charging an hourly rate. If counsel has unusually limited funds for mediation, counsel should work with the mediator up front to devise the most efficient process for mediation. I have sometimes found that counsel who complain about a "wasted mediation" often have sabotaged the process either by being unprepared on the facts, law or evidence or have failed to prepare their client for the process and for "the facts of life."
You may be interested in a brief article I wrote on this some time ago. http://www.mediate.com/rbarron/pg24.cfm
Thanks for your helpful web-site.
Richard Morley Barron
Barron Mediation
Flushing, MI