With the growth in mediation for resolving civil disputes, questions concerning average settlement offers are common for any party considering mediation for settling a conflict. While it is normal to pose such questions, trying to put a number on an average settlement offer for any case is not feasible. Bruce Edwards, a lawyer and mediation expert, shares insights into some of the basics at the heart of each mediated settlement that parties approaching mediation should focus on to help them set expectations and optimize possibilities for a successful settlement.
Says Edwards, “While there are few reliable statistics available regarding average settlement offers during mediation, we do know that offers reflect a multitude of variables from liability and damage considerations to the motivation of the parties to resolve the conflict”. Because these variables differ widely from case to case, there is no reliable way to determine an average value for settlement offers. There are, however, some known commonalities in settlement offers that can help inform and prepare parties during a mediated settlement. Some of these are:
- Both parties will approach the settlement from different perspectives, with the plaintiff hoping to get the most money out of a settlement and a defendant looking to pay the least amount of money possible.
- The first offer commonly starts high (if it comes from the plaintiff) or low (if it comes from the defendant).
- Both sides will probably start far apart in their offers and then make their way toward each other as the negotiations move on.
- Negotiations during a mediation can take time. At the beginning of the day, the parties may not move closer to an agreement, but as the day goes on and the direction of the settlement begins to crystalize, they may move faster and closer toward settlement or decide that it will not work out.
- The outcome of the negotiation will be somewhere in the middle.
How Do You Win at Mediation?
Unlike a jury verdict in a civil trial, there is no clear winner and loser in a mediation settlement. The goal of mediation is to reach a win-win settlement, where both sides see the outcome as fair and desirable and feel that they have reached a satisfactory agreement on their own.
A win-win settlement does not necessarily mean an equal win for both sides. One party may gain more in a settlement than the other, but if both parties gain more and both parties’ problems are solved, a win-win outcome is usually achieved.
In a settlement at a mediation, an agreement can also include non-monetary relief such as changes in the ways a company does business, repairs to damaged property, and even a heartfelt apology, as described in this article by Edwards on Average Settlement Offers in Mediation.
Says Edwards, “Many mediators agree that the sign of a successful mediation is when the plaintiff agrees to accept less than expected and the defendant agrees to pay more than expected. To get to a settlement, compromise on both sides should be expected.”
About Bruce Edwards
Bruce A. Edwards is an ADR industry pioneer and past chairman of the board of directors of JAMS. Along with his wife, Susan Franson Edwards, Mr. Edwards co-founded Edwards Mediation Academy, an online education platform dedicated to improving the skills of mediators and lawyers around the world.
Susan Edwards, Co-Founder
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