The debate over the merits of facilitative vs. evaluative mediation never seems to end, but is it an artificial distinction in the mediation of commercial disputes?

A recent article in the Australasian Dispute Resolution Journal suggests that it is.

The author, Troy Peisley, a mediator and arbitrator with more than 20 years experience in commercial litigation and forensic accounting, argues in favour of “blended mediation”, which combines the facilitative and evaluative models and employs a “mediation matrix” to evaluate both the qualitative and quantitative aspects of the dispute.

It’s an interesting model and seems equally relevant to the realities of commercial mediation in Canada.

Under the blended mediation model, the opening session of the mediation follows the traditional facilitative path, with opening statements, analysis of the issues and risks relating to the dispute, exploration of interests and joint problem solving. The mediator actively engages in questioning the parties, framing the issues, and brainstorming options, but offers no opinion or recommendations on the possible outcomes. The mediator will typically also meet with the parties in private sessions to further probe relative strengths and weaknesses and invite the parties to propose solutions. This phase usually includes further negotiations, either directly between the parties or through a “shuttle” process.

If the parties do not agree on a settlement, then the mediator adopts a more evaluative role. The mediator may express an opinion as to which party has a greater chance of success if the dispute goes to arbitration or litigation. The mediator may also make settlement proposals, to attempt to bridge the current gap between the parties. The parties may choose to engage in further face-to-face or indirect negotiations based on one or more of the mediator’s proposals or their own alternatives. In many cases, this evaluative phase is enough to break an impasse between the parties.

In fact, it seems that this blended model is what happens in most commercial mediations, regardless of whether mediators hold themselves out as facilitative or evaluative. At some point in the process, the parties always want to know what the mediator thinks, especially if the mediator has some particular subject matter expertise. The mediator often has ideas for settlement that the parties have not raised.

The mediator is in a position to float settlement proposals that the parties themselves are unable or unwilling to make. There is no attachment to mediator proposals; both parties are free to accept or reject them or to make alternative proposals.

The challenge for the mediator is to know when to shift from a more facilitative to a more evaluative approach. Sometimes, it’s obvious. The parties are at an impasse; they may have resolved some of the issues but are stuck on something – often money. Sometimes, it’s not so clear. The parties are continuing to talk, but going around in circles on a number of options. They aren’t making any progress and need a push from the mediator. The mediator may make an evaluative assessment of the options. This one is not practical; that one is too expensive; another requires some third party action or agreement. In this way, the mediator can help direct the parties toward an option that none of them thinks is ideal, but all can agree is acceptable (or at least better than the alternatives).

The best mediators are able to shift back and forth between facilitative and evaluative styles, as the situation requires. The parties may not even realize that the mediator is doing this. The mediator is simply reacting to the internal dynamics of the dispute, helping the parties define their needs and wants, evaluate the settlement risks and opportunities and negotiate toward the desired goals.

Peisley points out that the facilitative/evaluative divide has been almost an article of faith in mediation circles for the past 15 years (citing Professor Leonard Riskin’s theory of mediator orientation as facilitative or evaluative and the problem definition as either “narrow” [position-based] or “broad” [interest-based] – Riskin, “Understanding Mediator Orientations, Strategies and Techniques: A Grid for the Perplexed” (1996) 1 Harvard Negotiation law Review

This conceptual framework remains a very useful way to view the mediation process, to select a suitable mediator and to prepare for the mediation itself. But it can also be a trap, putting both the mediator and the parties into artificial boxes. Peistley’s view of mediation as a blended process is more nuanced and better reflects the reality of commercial mediation. Consciously adopting the blended model is likely to be far more effective than adopting either a pure facilitative or evaluative approach.

For a more detailed analysis of the blended mediation model and a sample mediation matrix see:

Peisley, Troy, “Blended mediation: Using facilitative and evaluative approaches to commercial disputes” (2012) 23 ADJR 26

Commercial arbitrators often hear litigators and business people complain that arbitration has become just as expensive as litigation.

"Why arbitrate when it costs so much? Plus we have to pay the arbitrator; in court, at least we don't pay for the judge."

It's a valid question. But I think the more important question is: what can arbitrators and counsel do to make arbitration more cost effective?

The arbitrator needs to take control of the process. This is harder than it sounds. Arbitration exists because the parties have agreed to arbitrate rather than litigate. So the parties control the process and set the rules to a certain extent. If the parties agree that there will be full discovery, it's very difficult for the arbitrator to say no. If the parties say they need two weeks for the hearing, it's tough for the arbitrator to say do it in one.

But there are several things the arbitrator can do:

• Hold an early conference call with counsel to set out the main issues in dispute. Make the parties define the issues — and narrow them, if possible. Arbitration claims and defences tend to read like any other pleadings – throw everything in. What's the arbitration really all about?
• Parkinson's Law ("Work expands so as to fill the time available for its completion.") applies to arbitration, just as much as it does to litigation. Set a tight deadline for each step of the process – generally, the quicker the arbitration the less expensive it will be. Set a realistic hearing date and work backward for each step.
• Set limits on document production, especially large volumes of electronic documents. In commercial disputes, most of the evidence will be documentary, but it's easy to lose sight of what's relevant and what's not.
• Limit examinations for discovery. Is it really necessary at all? If it is necessary, can the time be reduced?
• Have the parties produce a joint book of documents and an agreed statement of facts. Use witness statements to summarize the evidence on disputed issues.
• Use experts where necessary – especially for complex technical issues – but limit the number of experts. Can the parties agree on a joint expert or to have the arbitration tribunal appoint the expert?
• Consider using written evidence – affidavits and cross-examination – rather than oral evidence for some or all of the issues or witnesses, to reduce the number of hearing days needed.

I've heard it said that no case is so complex that it can't be arbitrated within one year from the notice of arbitration. True or not, it's a good benchmark to use when setting an arbitration schedule.

Counsel can also do a lot to make arbitration more cost effective for their clients, without conceding any advocacy points.

The "we can outspend the other side; we'll just keep going until they run out of money" strategy is not that appealing to most clients. Not if they can get a good result more quickly and cheaply.

Recognize that arbitration is different from litigation. The parties chose arbitration because they didn't want to litigate. Use the process to realize the benefits that the parties wanted when they originally decided to arbitrate.

If the other side is making life difficult and driving up costs unnecessarily, don't be shy about going to the arbitrator to enforce the schedule and stick to relevant issues.

But be selective about pre-hearing motions. They can rapidly increase costs, for very little long term benefit. Procedural motions don't have to be as formal as in litigation. A simple statement of the issue, the arguments and some case law in support of the order requested is all that's really needed. Avoid frivolous tactical motions. Don't forget the motion is being heard by the same arbitrator who will decide the substantive issues!

Use the applicable arbitration rules to your advantage. Most rules give the arbitrator the power to decide whether discovery is necessary or not, or to limit the scope of discovery. If the arbitration is about the interpretation of a contract and you have the evidence you need, there's no need for extra discovery.

Arbitration isn't bound by the strict rules of evidence, so the witnesses can simply tell their story at the hearing. Most of the hearing time can be spent on cross-examination to test the evidence and let the arbitrator determine credibility.

Evidence and legal arguments can be given to the arbitrator in writing, to cut down on the hearing time. Is it really necessary to argue every point or are there some things that the parties and their counsel can agree on? A lot of time and cost can be saved by providing the arbitrator with a clear roadmap, in the form of agreed statements of fact, witness statements, joint document books, technical briefs, joint expert reports and the like. Then the arbitration hearing can focus on the real issues in dispute.

None of this means giving up any tactical advantages. It just means using the arbitration process itself to best advantage. It's fundamentally different from litigation; don't treat it as a summary trial or private court.