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Being Candid and the Almost Never-Used Side Letter

January 11, 2014

Being candid up front with the mediator is not a terrible strategy.  As mediator, I think it can be very helpful to the lawyer, to the client, and to the process.

From its rarity, however, some people must believe otherwise.  Or else they haven’t considered its value.

Allow me to put these statements into context:

For every mediation, I request a written mediation statement in advance from each side, preferably to be shared with the other side.

Nearly always, there are important facts or interpretations of facts which need to be communicated to everyone.

Equally important, each side has priorities or goals for the settlement, and the mediator and the other side should know about them – so that they can be considered in the negotiation.

On the other hand, there are some things the other side should NOT know, which are nevertheless important for the mediator to know, to help the process along.

Consequently, when I write to counsel and request a shared mediation statement, I always suggest this too:

“If you would like me to know something from you confidentially prior to the mediation, you may accompany [your mediation statement] with a separate private letter to me.”

However, I rarely receive such a confidential side letter “for my eyes only.”

Sometimes, fortunately, I get the “lowdown” from the attorney orally, in a private telephone conversation before the mediation, in response to my question, “Is there anything that I should know that you didn’t want to write about?”

But sometimes I am left in the dark, which I think creates a missed opportunity.

Here’s why I think this:

When I was still in law practice a long time ago, I learned, first hand, the value of the private side letter addressed to the mediator.

In the case that comes to mind, I was defending a much older person in a real estate matter.

The client wouldn’t listen to me, young lawyer that I was, about the pitfalls of the case.

And I needed the mediator to know that the client didn’t or wouldn’t “get it” and that I thought the client could lose and lose big.

I felt badly for the client but I had to deal with the client’s stubbornness and refusal to face the realities of the case.

I also needed the mediator to understand the pitfalls in the case as I saw them and to reinforce to the client the reasons for settlement in light of those pitfalls.

Finally, frankly, I needed to make a record (a “CYA letter” if you will) of these negative facts and conclusions, so that I had something in the file that the client would have received, just in case.

So, I wrote a private side letter to the mediator, with a copy to the client; both the mediator and the client were the intended readers of this letter.

In the mediation consequently, the mediator was able to help me help the client, and after very long session that stretched late into the evening, we were able to document the negotiated deal that settled the case.

I trusted the mediator not to divulge this information to the other side, and I believe he did not share it.

I also know that, but for the side letter, the mediator would not have been able to facilitate the settlement effectively.

The next day after the mediation, the mediator called me to tell me that the side letter was not only instrumental in getting to resolution but that it was one of the most effective uses of that tool that he had ever seen.

To this day, more than twenty years later, I still believe that the private side letter is the place to open up to the mediator, to be candid and honest about the case, so that the ultimate goal of settlement can be achieved for the benefit of the client.

***

David I. Karp is a full time mediator of real estate and business disputes, principally, in Southern California.  His website is at http://karpmediation.com .  He apologizes for any ads affixed to this post by wordpress.com; they are not his.

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