mediatng construction disputes: perspectives from the mediator

MEDIATNG CONSTRUCTION MEDIATNG CONSTRUCTION DISPUTES:DISPUTES:

Perspectives from the Perspectives from the MediatorMediatorW. Jerry HooverW. Jerry Hoover

Attorney * Mediator * ArbitratorAttorney * Mediator * ArbitratorOctober 26, 2007October 26, 2007

2007 HBA Advising Construction Clients 2007 HBA Advising Construction Clients InstituteInstitute

Timing: When Do You Timing: When Do You Mediate a Construction Mediate a Construction

Dispute?Dispute?a.a. Pre-litigation?Pre-litigation?b.b. Post-petition?Post-petition?c.c. Pre-discovery?Pre-discovery?d.d. Post-discovery?Post-discovery?e.e. Pre-trial?Pre-trial?f.f. Post-verdict? (appeal)?Post-verdict? (appeal)?

SAMPLE ADR CLAUSESAMPLE ADR CLAUSE (MEDIATION):(MEDIATION):

“In the event of a dispute or controversy arising out of the interpretation or performance of this Agreement, the parties hereto agree to submit any and all disputes to mediation before a mutually agreed upon neutral third-party mediator prior to either party filing a demand for arbitration or a lawsuit in a court of competent jurisdiction. The fees and expenses of the mediator will be borne equally by the parties, and the mediation will be conducted in Houston, Texas. If the parties cannot mutually agree upon a mediator, any sitting Civil District Court Judge in Harris County may appoint one. If a party refuses to mediate within thirty (30) days of a written request to mediate by any party to this Agreement, then the non-participating party at mediation may not later recover its contractual or statutory attorney fees in a cause of action seeking relief or legal remedies for the matter giving rise to the mediation request.”

SAMPLE SAMPLE COURT COURT ORDERORDER

Ten (10) Mediation Do’s Ten (10) Mediation Do’s and Don’tsand Don’ts

Do’sDo’s Bring a decision makerBring a decision maker Bring a damage modelBring a damage model Keep an open mindKeep an open mind Give your best efforts to Give your best efforts to

evaluate the case for evaluate the case for settlement purposessettlement purposes

Consider Med-Arbs in Consider Med-Arbs in smaller casessmaller cases

Don’tsDon’ts Negotiate prior to the Negotiate prior to the

mediationmediation Schedule one-half day Schedule one-half day

mediationsmediations Exhibit litigation Rambo Exhibit litigation Rambo

tacticstactics Let your client spend Let your client spend

more in legal fees than more in legal fees than the value of the casethe value of the case

Throw the towel in early.Throw the towel in early.

MEDIATION DO’SMEDIATION DO’S

BRING A DECISION MAKERBRING A DECISION MAKER

MEDIATION DO’SMEDIATION DO’S

BRING A DAMAGE MODELBRING A DAMAGE MODEL

MEDIATION DO’SMEDIATION DO’S

KEEP AN OPEN MIND!KEEP AN OPEN MIND!

MEDIATION DO’SMEDIATION DO’S

GIVE YOUR BEST EFFORTS TO GIVE YOUR BEST EFFORTS TO EVALUATE THE CASE FOR EVALUATE THE CASE FOR SETTLEMENT PURPOSES.SETTLEMENT PURPOSES.

MEDIATION DO’SMEDIATION DO’S

CONSIDER MED-ARBS CONSIDER MED-ARBS ARBITRATION IN SMALLER ARBITRATION IN SMALLER

CASESCASES

MEDIATION DONT’SMEDIATION DONT’S

NEGOTIATE PRIOR TO NEGOTIATE PRIOR TO THE MEDIATIONTHE MEDIATION

MEDIATION DONT’SMEDIATION DONT’S SCHEDULE ½ DAY MEDIATIONSSCHEDULE ½ DAY MEDIATIONS

MEDIATION DONT’SMEDIATION DONT’S

EXHIBIT LITIGATION RAMBO EXHIBIT LITIGATION RAMBO TACTICSTACTICS

MEDIATION DONT’SMEDIATION DONT’S

LET YOUR CLIENT SPEND MORE IN LET YOUR CLIENT SPEND MORE IN LEGAL FEES THAN THE VALUE OF LEGAL FEES THAN THE VALUE OF THE CASETHE CASE

MEDIATION DONT’SMEDIATION DONT’S

THROW IN THE TOWEL EARLYTHROW IN THE TOWEL EARLY

ETHICAL CONSIDERATIONS ETHICAL CONSIDERATIONS AT MEDIATIONAT MEDIATION

CONFIDENTIALITYCONFIDENTIALITY

SOME ETHICAL DON’TSSOME ETHICAL DON’TS

CONFIDENTIALITYCONFIDENTIALITY

TRUE OR FALSE?TRUE OR FALSE?““AAnythingnything we discuss at we discuss at

mediation is privileged and mediation is privileged and confidential.”confidential.”

NOT TRUE!!NOT TRUE!!

Anything said at mediation that is later Anything said at mediation that is later discoverable, is not confidential.discoverable, is not confidential.

Clarification:Clarification: Anything discussed at Anything discussed at mediation relative to “settlement” matters mediation relative to “settlement” matters (dollars, demands, offers, bids, brackets, (dollars, demands, offers, bids, brackets, settlement terms and conditions) is settlement terms and conditions) is confidential and may not later be discussed confidential and may not later be discussed in front of the judge, jury or arbitrator.in front of the judge, jury or arbitrator.

CONFIDENTIALITYCONFIDENTIALITY12. CONFIDENTIALITY. 12. CONFIDENTIALITY. Confidential information Confidential information

disclosed to a Mediator by the parties or by disclosed to a Mediator by the parties or by witnesses in course of the mediation shall not be witnesses in course of the mediation shall not be divulged by the Mediator. All records, reports or divulged by the Mediator. All records, reports or other documents received by a mediator while other documents received by a mediator while

serving in that capacity shall be confidential. The serving in that capacity shall be confidential. The Mediator shall not be compelled to divulge such Mediator shall not be compelled to divulge such records or to testify in regard to the mediation in records or to testify in regard to the mediation in any adversary proceeding or judicial forum. Any any adversary proceeding or judicial forum. Any party that violates this agreement shall pay all party that violates this agreement shall pay all fees and expenses of the Mediator and other fees and expenses of the Mediator and other parties, including reasonable attorneys’ fees, parties, including reasonable attorneys’ fees,

incurred in opposing the efforts to compel incurred in opposing the efforts to compel testimony or records from the Mediator.testimony or records from the Mediator.

WORD TO THE WISEWORD TO THE WISEBe Be certaincertain that if you discuss any that if you discuss any confidential information with the confidential information with the

mediator in private caucus, that he/she mediator in private caucus, that he/she knows it before he/she leaves your knows it before he/she leaves your

room. Do not assume the mediator can room. Do not assume the mediator can distinguish between confidential and distinguish between confidential and

non-confidential information.non-confidential information.

Some Ethical Don'tsSome Ethical Don'ts No Personal Service at MediationNo Personal Service at Mediation

Don’t Threaten to Call the DA’s Office Don’t Threaten to Call the DA’s Office or Threaten Criminal Prosecution.or Threaten Criminal Prosecution.

““In the midst of In the midst of difficultydifficulty……there lies opportunity.”there lies opportunity.”

Albert EinsteinAlbert Einstein

““MargaritaVille is wherever you MargaritaVille is wherever you want it to be.”want it to be.”

- Jimmy Buffet, Coral Reefer Band- Jimmy Buffet, Coral Reefer Band