Heine Associates, P.A.

Commercial Dispute Mediation: A Personal View

Commercial Dispute Mediation: A Personal View©

By I. Michael Heine, Esq.

While the term mediation has taken root in the law practice vocabulary, it is a concept which, in case to case, bobs, weaves and mutates from mediator to mediator. As mediation is practiced there are graphic differences in mediation styles and strategies. The mediator must manage the conflicting dynamics of personality (including his own), and assist the parties in finding compatibility with their competing visions. Business decision making in an adversarial environment can be a painful, expensive and emotional journey.

What follows is not unique, (not my invention, to be sure), but my own view of the mediation process, grown from my years of business and contract litigation, scraped shins, gray hair and a dose of salts. For me, and the attorneys and their clients with whom I've worked, it has succeeded about 95% of the time.


In the day-to-day commercial world of healthy relationships, business is successfully negotiated head-to-head. Typically, if a negotiation is successful, deals are reached and benefits are exchanged. On the downside, if unsuccessful, the parties can retreat without scars, losing only a potential opportunity.

However, when an adversarial relationship exists (i.e. where there is serious jeopardy of legal accountability), the parties do not enjoy the privilege of a one-sided exit. This holds, for example, where there are risks of legal contractual responsibilities, or where the law may impose duties because of conduct in activities, relationships or transactions.

The profile of adversity can be ugly:

  • Swords are rattled
  • Transactional expenses occur
  • Positioning becomes tactically important for the impression or communication of strength and power
  • Real needs become obscured by demands---and-
  • Emotion clouds sensible business judgment


The skillful and experienced mediator, while protecting the communications with each party by strict confidentiality, privately helps each side objectively to:

  • Define the operative and controlling issues
  • Assess the evidentiary strengths and weaknesses of each side's position, as well as probabilities of outcome
  • Project all economic impacts
  • Clarify its vision of its practical needs ----and ----
  • Develop a strategy for a settlement, which is acceptable to that party and realistically achievable

At the right time, and only with a party's authority, constructive information is communicated, and, in the interplay following, a practical settlement is achievable which cuts through the divisive stakes, egos, traditions and business cultures which feed litigation.


  • Each party remains in complete control of its position
  • The mediator does not impose either a solution or his subjectivity
  • The final settlement reflects the positioning of the parties as that develops in the process of the mediation


Solutions may include:

  • Money
  • Non-monetary arrangements
  • Business terms

Also, partial solutions, which may limit or minimize the scope of future litigation, are welcomed achievements where full settlements cannot be reached.


Because the mediator's time and energy must be devoted to the evolving process, compensation is generally on an hourly rate, allocated equally between/among the parties. The mediator must maintain his independence, and cannot have any compensation dependent on the outcome of the process.


Mediation is always timely, from the earliest moment it becomes apparent in a relationship that meaningful differences cannot be resolved sensibly by routine business negotiation.

Importantly, the flexibility of the consensual mediation process comfortably permits achieving arrangements for timing issues. It is vitally important for the success of the mediation that the safety of the harbor be maintained for the disputants, and the process be kept rational and intelligent. So, for example, when appropriate, the status of business, operational, financial or legal conditions can be provisionally managed on a limited interim basis. Also, a program can be achieved for developing, exchanging and evaluating pivotal information. In mediation this process of information cultivation is generally far more focused and cost efficient than open discovery in scorched earth litigation. Moreover, it is accomplishable without prejudice to discovery rights which might be exercised if litigation is resumed.


In contrast to the consensual mediation, arbitration is a third-party adjudication (i.e. decision making), which is available as an alternative to the state and federal courtroom process. A commitment to binding arbitration arises solely out of an express agreement between the disputants reached either before or after a dispute arises. A binding arbitration award becomes an enforceable judgment.

Non-binding arbitration, while available contractually, is frequently a mandatory procedure created by state rules of court. Although it may be imposed upon disputants, the award of the arbitrator in the non-binding procedure may become binding unless avoided by timely election.

The difference between mediation and arbitration is dramatic: In arbitration the disputants give a third party control over their destiny. In mediation they maintain control and conclude the conflict by agreement of all parties.

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