In Houston, UIA World Mediation Forum Co-President Thierry Garby moderated a panel on mediator ethics. Speakers included Claude Amar, President of the French Academy of Mediators; Trey Bergman of Houston; Jim Lawrence of the University of Houston Law Center; and Patrick van Leynseele of Dal & Veldekens, Brussels.
The opening issue was power imbalance. What role does the mediator assume when unfairness, fraud, lack of information, legal incompetence or failure of due diligence results in a proposed resolution that is incontestably unfair? In the United States, judges do not correct poor lawyering, and arguments that are not raised are not ruled upon. Judicial practice in civil countries like France is entirely different. Is there an obligation of a mediator to point out that value opportunities (such as claims on an excess insurance policy) are ignored? Conflicts of interest that arise from the party representative being hired by an insurance company were also raised. Mr. Bergman suggested that “living in the question” might be an approach: Rather than stating something, asking “What would happen if…?” The technique raises the issue without the mediator’s losing credibility or trust, or appearing to advocate.
Mediation compensation raises other issues. The example is two mediations: One involving several million and the other a few thousand dollars. The mediator’s compensation is constant even though her value – as measured by the benefit to disputants — varies greatly. Is there any problem with the parties agreeing to a “satisfaction fee” given as a bonus by either or both parties at the end of the mediation? Were the mediator to agree on such terms, with the knowledge and agreement of all parties, would the mediation be conducted differently? What if the fee were payable only if the matter settled at or soon after the mediation? And would a third party be interested in learning that, in the past, the mediator received a success fee from the adversary in a previous matter? And would accepting such fees redound poorly in the long-term growth of the practice?
Limits of confidentiality: A party offers a building in satisfaction of a claim. The party tells the mediator that the building is environmentally unsound, but instructs him not to inform the other party. Should the mediator facilitate, or even allow, fraud? Or is it the responsibility of the other party to do sufficient due diligence to get assurance of the value of the offered property, or else live with the consequences of failing to do so? What is the “best practice” approach for the mediator who presides over a resolution that may be unenforceable, or even unlawful?