Last year, I blogged on this topic after I was at a mediation where the mediator, when telling us his assessment of my client’s case, said that he was creating "settlement anxiety." At the time, I had never heard of this term but what I believed was meant was that the mediator wanted the client to have "anxiety" about his/her position in order to be more likely to make compromises and settle. If the goal is getting a settlement at all costs, I guess it makes sense – but is it fair, especially where one party is acting reasonably, and the other is not. As this has come up in two recent mediations, I thought it made sense to reprise this post.
In most cases, there is a "realm of reasonableness" or a range in which any settlement would be essentially fair. Perhaps, a fair alimony figure could be between $100,000 per year and $125,000 per year. A fair resolution could be either of those numbers and anything in the middle. In most cases, people, with all relevant facts and acting reasonably, negotiate within the realm of reasonableness, but at either end depending on which side of the case they are on. In that case, a mediator trying to create "settlement anxiety" will try to express the flaws in either case to get the parties to meet somewhere in the middle to achieve a result that is fair.
But what about cases where one party is negotiating within the realm of reasonableness and the other is not? Put another way, what about cases where one party has the law and the facts pretty much on their side as to most issues and the other side is taking a position that is absurd? In this case, should the mediator be trying to create similar "settlement anxiety" in both parties? Add another level – what if the mediator knows that the unreasonable party will never settle the matter in a reasonable fashion? Should the mediator pressure/create the same amount of "anxiety" in the more reasonable party just to achieve a settlement even though everyone knows it is unfair? Should the result be settlement at all costs? Does this type of pressure on the righteous party just to get a deal done artificially undermine a party’s relationship with her counsel and experts, if just for settlement purposes, they are told that their case is weak when it is not?
In my humble opinion, pointing out the legitimate limitations in someones case in order to help create a settlement is fair and appropriate. On the other hand, creating artificial anxiety just to get a settlement all all costs because one party is acting unreasonably or negotiating in bad faith is not. The system should be fair and equitable and the parties are entitled to justice. It is neither fair nor justice to lessen a party’s confidence in their case, artificially, just because the other side will never settle in a fair and reasonable manner.
That does not mean a party cannot give more ore receive less just to get a case done and move on with their life. That is their choice. In fact, in recent cases, the mediators have used the anticipated costs of litigation as the pressure point on the party with the more reasonable position. Perhaps the better tactic would be to tell the unreasonable person of their exposure to pay the reasonable party’s legal fees.
That said, the reasonable litigant should not be manipulated just because the other side refuses to be reasonable. And as I have blogged before, sometimes you just have to try a case.