First Mediation | Jeffrey Krivis

Over the years I have been asked to mediate cases in various and assorted venues, including law offices, parks, hotel rooms, underground garages, elevators and so on. But a recent case was the first time I have been asked specifically to mediate electronically.

The tools that were available to me were simple: a computer, a modem ... and the open frontier space of the Internet. Although these had been familiar tools for checking web sites and sending colleagues messages, they were about to be used in a much different way.

While I fancy myself as a pseudo-computer junkie, I must confess that all of my technical knowledge about computers served no meaningful purpose in the mediation I'm about to describe. At the same time, it became clear that the matter not only was doable, but also raised some unexpected problems associated with the unusual circumstances that can be avoided in the future -- when the circumstances likely will become commonplace.

What follows is a discussion of the events that took place, taking into account the confidentiality of the matter.

The case involved a relatively simple contract claim brought by a U.K. franchiser against his most successful franchisee in the western U.S. The franchisee had completed a multi-million dollar sale of the company's primary product to a large U.S. restaurant chain. As part of the franchise agreement, the franchisee agreed to remit a percentage of the gross sales to his eastern U.S. franchisee counterpart.

A dispute centered around the fact that the eastern territory franchisee left the company shortly after the sale was consummated, but before the product was shipped and before monies were received. The franchiser felt the monies were due to him since he stepped into the shoes of the eastern territory.

The parties had been negotiating over an appropriate arbitration venue when it was referred to me. The franchise agreement provided a binding arbitration clause in which New Jersey would have full jurisdiction over disputes, but the east coast wasn't convenient for either party since one lived in California and the other in England. The parties tried to reach agreement on a more convenient location, but the mere discussion of the issue led to further animosity.

It was at that point I received a call from the franchisee who had heard of my work and wanted to know if I had any ideas. At first I suggested that he allow me to talk to the franchiser by telephone and try to conduct a "telemediation." It was difficult, however, to coordinate time schedules between the parties due to their respective geographic locations. (For example, if it was 11:00 a.m. in Los Angeles, it would be 9:00 p.m. in England.)

I then asked the parties if they were on any type of online computer service, and was told that they communicated regularly over Compuserve. I suggested that we try mediating using their Compuserve electronic mail addresses and my online address on Counsel Connect. The parties liked the idea of communicating electronically because they would have an opportunity to digest the dialogue at their pace and respond after appropriate reflection. I proposed that if mediation online did not resolve the dispute, I would help them negotiate an acceptable location and neutral for the binding arbitration.

Before the mediation started, I had minimal contact with the franchiser in England -- just enough to confirm that he was willing to participate in a mediation, and that he preferred to mediate online. I also had a telephone conversation with the western territory franchisee who gave me background on the dispute, as well as his objectives for the mediation.

My initial discussions with the two parties revealed two interesting challenges. The first was familiar: to convince the two parties that they could not do better in court than they could do through mediation. The second challenge would be more difficult: to enable them to maintain their business relationship after the mediation.

I felt it was necessary to begin the mediation by developing a rapport and sense of confidence with each party before getting into the details of their arguments. Building a rapport without being able to have " instant" dialogue with someone proved to be an unexpected obstacle. The sheer physical distance and the delay of communicating through the Internet, compared to the luxury of body language and facial gestures we take for granted in a typical face-to-face mediation, was surprisingly frustrating.

The first thing I did was send out a short profile of myself in order to generate some sense of credibility. I figured if they knew I was a university professor with an extensive commercial mediation background, they might feel a little more comfortable sharing their objectives with me. Next I sent a confidentiality agreement outlining how I liked to work and the importance of maintaining privacy in our communications. Before discussing any of the disputed issues, I asked both parties to confirm in writing their willingness to follow the rules I set forth in the confidentiality agreement. At that point, we hit our first stumbling block.

No Response

This dispute resolution process had to be built brick by brick. I asked each side to send me a private, confidential message outlining what they believed were the issues in the dispute. My instructions were simple: do not offer any solutions at this point, just give me your candid thoughts about the case. I felt that offering to mediate this in a systematic way would force the parties to climb the ladder toward agreement by taking baby steps one at a time. ** There also was no other choice given the venue.

Once I received the parties' confidential messages, I drafted a summary of the disputed issues, and asked each side to talk/write about the issues in the order of priority that I recommended, based on the feedback from each of them. In essence, I set forth a specific agenda based upon the parties' memos.

I had assumed that I could draw upon my experience as a practitioner in the field to help me manage any unanticipated problems. Nevertheless, I found that several issues came up repeatedly that require tools not commonly found in my toolbox. For example:

Time. Time stands still when mediating over the Internet. There almost is a sense of being suspended in Cyberspace without any direction. I found myself setting artificial time limits in order to push the parties to commit to respond and to keep them on track.

Language. As the parties began to respond to my questions, it became clear that they had strong opinions about each other, and the opinions weren't pretty. I had a choice to make in reporting to each side the series of concessions that I was trying to create with the other. The choice was either to be a straight reporter of information, or to try to filter the information so that the language I used would be less offensive than what I was receiving from the parties. In contrast to a mediation in person, it was difficult to ascertain the parties' true feelings when they used hostile words. In this case, I just assumed that they were blowing off steam and were looking to me to be the diplomat in the group.

Loss Of Momentum. As the issues surfaced and the negotiations commenced, no one told me that people travel and sometimes don't check their E-mail. Once again I found myself in the middle of a dialogue without any response from the parties. This time I was certain that my efforts were for naught, and that they thought the process was a waste of time. After two weeks of no communications, I finally got a message from the franchisee. He wrote that the franchiser was on vacation and had a different "personal" E-mail address than the address I had been using for the mediation. I then put the case back on track by contacting the franchiser at the other address. I learned at that time that the franchiser, unaware that I didn't have his other address, had been as frustrated as I was.

Fear of Rejection. Although tempted to view the situation as a rejection of the mediation process, I continued to encourage the parties with questions that asked them to think about their future relationship. I found it to be beneficial to spend a small amount of online time philosophizing about their successful venture and what might happen after they conclude this mediation. In short, I transformed my fear of rejection into a positive outlook on the process.

Trial Balloons That Burst. Just when I thought it was safe to present a proposal to each side, I received an E-mail from the franchiser in which he demanded an admission by the franchisee that the franchisee was at fault. I tried to explain that the process of mediation was different than arbitration, and that admissions were not necessary for us to reach a favorable outcome. Nevertheless, the mediation was stalled momentarily as I tried to figure out a way to get the franchiser to look forward, not backward.

My solution was to go back to the basics and do some online active "listening." In other words, I spent some time repeating almost verbatim what the franchiser was requesting in order for him to realize that I understood his message. I then redefined his concern by pointing out that specific words aren't always necessary to be considered an admission. I indicated that if we could obtain a certain concession on the ultimate deal, that could be viewed by him as an admission without words. I tried to soften his position so that we could move on to productive solutions.

Settlement Scotched?

I decided to trust my intuitions and looked to grab my trusted old hammer from the box. I decided to let him know that his position would not get the case resolved, and suggested that the franchisee might view it as an insult so late in the negotiations. I then told him I would take into consideration everything both parties had to say and send them a "Mediator's Proposal." This would be my way of offering an option based upon my listening objectively to the facts of the case. The proposal would include substantial supportive arguments so that they would understand and more likely accept my recommendation.

I prepared a neutral evaluation of the case with specific settlement numbers. I deposited the proposal into Cyberspace along with a request that the parties give me their unconditional answer within 48 hours.

I am pleased to report that it worked. Both sides sent supportive responses indicating acceptance of the proposal and a willingness to mend fences, along with thanks for being patient with them.

When Online is the Best Method

Moreover, the lack of momentum that is felt by not having instant access to the parties makes it difficult on the mediator to move quickly toward closure. Nevertheless, the experience of solving this dispute has confirmed that we have now broken down the global walls, so that even though participants may be separated by oceans and continents, the process of mediation can be accessed by anyone.