New International Practice Column! Multi-Dimensional Mediation (Web)
November 24, 2009
BY PAUL E. MASON
The author is a neutral with the ICC, ICDR, WIPO and the CPR Institute. He focuses on mediating complex high-value cases, especially those with an international dimension. Several involve parties from Latin America. He also sits as an arbitrator. He is a consultant at the Miami-based international law firm Diaz Reus and Rio de Janeiro-based Bastos- Tigre, Coelho da Rocha e Lopes. He is former Latin American Legal Director, in-house, for Digital Equipment, Oracle, and 3Com/Palm. He can be reached at email@example.com or firstname.lastname@example.org. An expanded version of this article will appear in Alternatives in 2010.
Q: What is multi-dimensional mediation?
A: Multi-dimensional mediation goes beyond the usual concept of multiparty mediation, although it can and often does include more than one party. As the term suggests, multi-dimensional mediation involves mediating beyond the normal two-party scenario where many other factors come into play.
These can include any of the following: more than one party; several entities participating in the mediation whether formal parties or not; a large number of mediation participants; employment of co-mediators, assistant mediators, or experts consulting with the mediator; different media used to conduct the mediation; participants coming from different countries; cultural and negotiating traditions; use of more than one language for the mediation, and more than one organization involved in the mediation's administrative aspects.
Q: Have you been involved as a mediator with any of these scenarios, and how have they turned out?
A: I have mediated at least three of these and acted as counsel in another one--all successfully as it turned out. Although the total number of such mediations is not large, the cases were all complex and high value.
The first was an international commercial dispute over reinsurance coverage for a public bid bond on an Argentine government contract, worth about $5 million.
The second was an international business dispute in the energy sector where a Brazilian executive’s bonuses were tied to performance in renegotiating energy project financing for his company, which was owned at the time by a large energy multinational.
The third was an international business conflict involving a Brazilian oil company's post-M & A environmental and tax liabilities. The company had been sold by its Brazilian owners to a multinational oil company. The case was valued at about $3 million.
The most recent was another international business dispute between companies in Central America over insurance and reinsurance coverage for business interruption flowing from damage to energy producing equipment. This case had claims of about $6 million.
Q: What were the multi-dimensional aspects of each of these cases?
A: The Argentine public bid bond case had seven participants on one side and just two on the other, and I mediated it in both English and Spanish. The Brazilian post-M & A case likewise had unbalanced numbers of participants, with six on one side and three on the other, and I mediated that one in Portuguese and English. The Central American case had 11 participants from six countries and six different companies, not all of whom were formally named in the claim. We conducted that mediation in English and Spanish.
Q: You have mentioned certain factors that make these experiences interesting or unusual in international mediations. Can we briefly touch on these? First, how do a large number of participants alter the mediation dynamics?
A: It is important to note that the number of participants as a dynamic-influencing factor is separate from the number of formal parties involved in the mediation.
With numerous participants, especially when they are coming from different countries and/or speaking different languages, a main concern is ensuring meaningful dialogue--as opposed to cacophonous “multi-logue”.
There are various ways to do this. In this situation, the mediator has to be aware from the outset of this challenge and meet it head on.
Another thing to bear in mind is to remind all these people of their duty to keep the mediation confidential–this is easier to accomplish with one or two people on each side. The laws of certain countries do not automatically protect information revealed in a mediation as confidential, so all participants need to be reminded to check with their attorneys first on this.
Q: What about the language and locale issue in international mediations?
A: As in many mediations, circumstances may change from the time the initial request is filed until the mediation session actually occurs.
In one case, the original request was quite pointed and rigid–the parties specifically asked for mediation to be conducted in Central America in Spanish. On researching the laws of the Central American country involved, however, I found the relevant mediation law to have several problems and exclusions.
So we moved the mediation to Miami. Although the parties had originally asked for Spanish only, late in the game one of them brought a key decision-maker from Europe who did not speak Spanish. We decided to let each person speak in the language they were most comfortable with, holding more of the mediation in English to accommodate the European executive.
We asked each one if they could understand English well, but having those preferring Spanish to speak Spanish in order to express their thoughts and feelings more accurately.
If language is an issue in your mediation, I would suggest carefully polling each side’s list of participants about their respective language abilities and preferences well before the mediation session begins.
Q: Finally, how do you address multiple cultural presences in the mediation?
A: A colleague of mine says I am a cultural relativist as opposed to a believer in universality of principles when it comes to mediation. True. While some principles and things cut across and through cultural lines, I have found that negotiating styles by and large do not. And negotiation is really at the heart of mediation.
In the recent Central American mediation, I found one side to be very crisp and decisive but far less flexible, while the other side was slower, indirect, flexible and elliptical. When I saw the first side growing impatient with the indirection of the other side, I counseled patience with them because that is the way things are done in that particular part of the world.
Likewise when the indirect side asked me whether I thought the other side would accept a much larger offer than had previously been indicated, I advised caution not to insult them and to consider the lack of flexibility which is characteristic of that area’s negotiating style.
In short, while not revealing any specific negotiating information to either party without the other party’s prior consent, I compared with each one the general parameters of both sides' respective negotiating styles. This seemed to help each side be more realistic about what they could accomplish and drive them toward a settlement.