Michael A Gregory, ASA
Principle/Owner, Michael Gregory Consulting, LLC
Abstract: As an independent expert you are not an advocate for your client, but you are an advocate for your position. However, there are times when given assumptions and approaches it may be in your and your client’s best interest to work with a neutral, impartial mediator to resolve differences with another party. This article explores the use of a qualified mediator to assist you and your client with dispute resolution.
Mediation can save the parties time and money. Mediation allows the parties to determine the result rather than have a decision imposed by a third party. Mediation is confidential. The process can reduce stress as well as emotional and physical toil. Mediation can be carried out in parallel with litigation. The process allows for an additional option for settlement. Finally, it gives the parties timely closure.
Mediation is a confidential process whereby a qualified mediator works with the parties so that the parties can make a decision that is acceptable in nature. Mediation may take the form of an evaluative, transformative, or facilitative approach.
In evaluative mediation the mediator researches the work of each expert, meets with them, and then provides what the evaluative mediator may think would happen if the case went to court. This becomes the starting point for the parties to work together to try and resolve their dispute.
A transformative mediator attempts to transform a relationship between two parties as the highest priority while assisting the parties in resolving their dispute. For example, in family divorce the mediator may focus on the children to help the parties come to an amicable agreement they can live with going forward.
A facilitative mediation is a process where the mediator works with the parties to look at the dispute from a different perspective promoting each party to consider underlying assumptions, methods, and interests to help the parties come to an amicable resolution.
The ideal appraiser in mediation should be able to:
The purpose of mediation is to resolve the issue, so in this instance understanding the sensitivity of variables used in the appraisal process and the impact of assumptions on the appraiser’s determination help the team to evaluate each side’s expert opinion.
With experts such as appraisers, typically a facilitative approach is used. In this instance a qualified appraiser mediator with a background in appraisal would meet with all parties ahead of time: the decision maker, the appraiser and the attorney on each side. The qualified appraiser mediator would have read the appraisals ahead of time and would come forward with questions and explore the interests of the parties. Having met with both parties separately beforehand, the appraiser mediator would indicate whether mediation might be an appropriate alternative or not. If the parties are so entrenched that one or both of the parties are not willing to move off their position, there is no reason to waste time with mediation. Litigation or arbitration would be more appropriate in this instance. However, if the parties are both open to movement from their initial positions, mediation may be a good alternative.
If mediation is accepted by the parties and the appraiser mediator, the appraiser mediator would have all parties sign an engagement letter spelling out the process and limitations. If the mediation is conducted virtually, a separate agreement also needs to be signed by all of the participants acknowledging the role of the parties and agreeing to the process of virtual mediation.
The mediation would begin with a joint session. To reduce tension, the appraiser mediator might initiate the process with an icebreaker such as asking everyone present to share something positive of a personal nature that has happened in the last 30 days. De-escalation and addressing emotions is critical towards working together to formulate a resolution. Following this icebreaker and introductions, each party would present an opening commentary. After the opening commentary by one party the other party would be able to ask any questions, but this would not be a time to refute the opening commentary of the other party. The appraiser mediator would ensure the process is carried out appropriately. Then the other party would reciprocate.
Following the introductory remarks, the parties may either stay in the same room or they may proceed to separate rooms and mediation would begin. If the parties are in the same room the appraiser mediator would facilitate the process. If the parties are in separate rooms the appraiser mediator would proceed back and forth between the rooms. In this instance each party would share with the appraiser mediator their concerns in terms of facts, issues, emotions around the issues, and their interests. The appraiser mediator would ask exploring questions and after hearing the commentary, phrase what was heard in a neutral manner to share with the other party. The appraiser mediator would proceed back and forth between the parties exploring various alternatives in an attempt to help the parties reach a resolution.
During this process the decision maker and attorney generally for the first time begin to understand more fully what the strengths and weaknesses are of the expert’s report and begin to look at what might happen if the case were to proceed to litigation.
After this initial meeting often the decision maker and attorney of each party regroup and meet again with the appraiser mediator and the other party to try and work out an agreement. There may be more than one meeting like this with or without the decision maker present. The goal is for the attorneys for each party to have a good understanding of the situation and the expert’s perspective to work together to resolve the issue in an amicable manner.
If you would like to dig a little deeper into this subject matter, here are some additional sources for your consideration.
Mediation is a process that allows the parties involved to self-determine a conclusion and closure. Mediation can save time and resources. Mediation is confidential. An appraiser mediator speaks the same language as the appraisers and is more effective. Mediation is more productive than litigation. Being involved with mediation can assist the client by providing insight on assumptions, methods, sensitivity analysis, and other insights to help the client work towards an amicable solution with the other side.
Michael Gregory, ASA and CVA, founded Michael Gregory Consulting, LLC in 2011 after 28 years with the IRS where for 11 years he led the national business valuation program. He is a qualified mediator and a negotiation specialist, an international speaker, and an author with 12 books and over 45 published articles. He is a Qualified Mediator with the Minnesota Supreme Court, has served on the ASA BV Committee, chaired the Oversight and Ethics Board at NACVA, and has served on over a dozen boards. He currently serves on the board of the Minnesota State Bar Association Alternative Dispute Resolution Section. Email mg@mikegreg.com