The Great Compromise*

What is it about the word "compromise" that tends to raise the hackles of those who hear or read it? To many, any compromise is regarded as the shameful abandonment of principle. Perhaps the best example of the negative visions that the word conjures is the Munich debacle in the fall of 1938. Neville Chamberlain, trying desperately to avoid another catastrophic war with Germany, sold the fledgling Republic of Czechoslovakia down the river, thus, making another catastrophic war with Germany inevitable.

Against such a backdrop, it is well to remember that the word "compromise" was not always considered epithetical. In any society, interests — even principled interests — will inevitably clash. For a society to survive, means must be found to resolve those differences peacefully. And not all conflicts are susceptible to win-win resolutions. The great British statesman, Edmund Burke, for one, regarded compromise as an essential and beneficial part of the human condition. See my post of May 26, 2008, "The Best Compromise That Never Was?."

In order to counter the prejudice against all compromise, it is useful from time to time to discuss historical examples of some that proved to be fortunate. The first that springs to my mind was reached in July of 1787 at Independence Hall in Philadelphia (pictured above). As I have stated before, the drafting of the United States Constitution involved "a high-stakes negotiation among many distinct interest groups." See "Yes, Virginia, There Is a Plan," May 25, 2008. Potentially the most crippling dispute facing the delegates dealt with the question of how the national legislature would be constituted. Delegates from larger states like Virginia favored election of representatives based on population. This, its adherents believed, would assure a legislative body truly national in character. Opponents of this concept, chiefly from the less populous states, believed that each state should have equal representation, else the smaller states would lose all power in the national government.

More than mere self-interest was involved in the debate; both sides supported their positions with principled arguments. The question occupied the delegates for a month, with almost no progress toward resolution being made. The issue was so divisive that many despaired of overcoming it and feared that the Convention would dissolve in failure as a result. Fortunately, most delegates were committed to the success of the endeavor, and ultimately took the larger view that without some compromise of principle, the entire American experiment would miscarry. Thus, they recognized that the larger principle of national unity was on the line, without which all other principles would be irrelevant. A so-called "Grand Committee," with members from each state, was formed to study the issue over the Fourth of July recess. One of its members was Benjamin Franklin, who proposed the concept of proportional representation in the lower house (House of Representatives) — which was to be given the exclusive power to generate revenue bills — but equal representation for each state in the upper house (Senate).†

It took almost two more weeks, but ultimately the delegates approved the compromise by a narrow margin. Eventually even James Madison, one of the most strident of those opposed to anything but 100% proportional representation, put the issue behind him.

And the rest, as they say, is history.


* For background on this post, I am indebted to William L. Shirer’s classic The Rise and Fall of the Third Reich (New York: Simon and Schuster, 1960), Catherine Drinker Bowen’s Miracle at Philadelphia: The Story of the Constitutional Convention, May to September 1787 (Boston: Little Brown and Co., 1966), and Richard Beeman’s more recent Plain, Honest Men: The Making of the American Constitution (New York: Random House, 2009).

† The concept of mixed representation — the people represented in the lower house and the states represented in the upper house — was based on a proposal floated the previous month by Roger Sherman of Connecticut, which is why the result is sometimes called the "Connecticut Compromise." But the idea didn’t get a lot of traction until Franklin wined and dined the members of the Grand Committee, tweaked it a bit, and lent it his support.

The Dick Francis Solution

Long before I ever heard about Fisher and Ury’s Getting to Yes, I started reading Dick Francis’ mysteries. For those not familiar with his books, Francis, formerly a steeplechase jockey, develops his novels around British horse racing. His protagonists, rather than being super sleuths, are usually fairly normal, civilized people who are forced to deal with extraordinarily uncivilized situations; his villains are some of the most evil and malevolent specimens in literature. What struck me when I first started reading his books, was that their focus was primarily on how situations could be resolved to best serve the interests of the protagonists — even if the solutions did not always result in all the villains getting satisfactorily crunched.*

With this background, when I was first exposed to Getting to Yes, it was relatively easy for me to understand what the authors were getting at when they discussed the superiority of focusing on interests rather than positions.

When a person is injured due to another’s fault, often the first reaction is a desire to punish the offender. If I have been hurt because someone else was careless, I want the other guy to suffer as much as, or more than, I have. It is difficult for the lizard part of my brain to accept that the aim of the civil justice system is not punishment. Sometimes this initial reaction will fade with the passage of time, but not always and usually not completely. A plaintiff’s lawyer who expects a case to settle must work with his or her client to overcome this natural reaction.

"Revenge," the proverb says, "is a dish best served cold." But, in truth, it isn’t a dish at all. Revenge doesn’t put food on the table, replace lost income, or pay medical bills. Revenge doesn’t put your kids through college or provide for your retirement. And, largely because of liability insurance, the defendant will never feel the financial pain he or she has inflicted on you.

The sooner a plaintiff accepts the reality of the situation and is ready to make decisions based on what is best for him or her, as opposed to what is bad for the other guy — to accept the Dick Francis solution, in other words — the sooner a case is likely to settle and the plaintiff can move on with his or her life.


* Some examples are Risk (1978), Reflex (1981), Straight (1989) and To the Hilt (1996).

Deus ex Machina Mediation

Deus ex machina literally means "God from a machine," and refers to the practice in ancient Greek drama* of bringing in a god (lowered to the stage toward the end of the last act by a crane or on a piece of scaffolding) to magically solve all the problems created during the course of the play. Merriam-Webster Online defines the term in context as "a person or thing (as in fiction or drama) that appears or is introduced suddenly and unexpectedly and provides a contrived solution to an apparently insoluble difficulty."†

Some litigants approach mediation with little or no preparation, no clear vision of the result they want to achieve, and no plan as to how to proceed. The idea on each side seems to be that it is the mediator’s job to somehow convince the others to accept their position, without having to present a clear reason for them to do so beyond saying something like: "We are confident that a jury in this county will go along with us." The mediator is then expected, by means indiscernible to mere mortals, to get everyone to agree to a solution somewhere in between the parties’ positions. In reality, the mediator is reduced to shuttling back and forth like Henry Kissinger, unable to say anything more illuminating than "[d]o you realize you might lose this case?" Although such mediations do sometimes lead to settlement, I suspect that the same results could have been achieved by exchanging a series of e-mails, without the need for a mediator.

For a mediator to help parties settle a case, the parties and their lawyers normally have to work as hard as, or harder than, the mediator. They must: (a) know their cases thoroughly; (b) be imaginative and flexible; (c) know roughly where they want to go; (d) have a plan as to how to get there; and (e) be prepared to give plausible reasons for each step taken. If the participants have done their homework, then mediators have many tools to smooth the process and help the parties arrive at a mutually satisfying solution.

As is the case with most human endeavors, hard work, sweat and preparation are necessary to get the job done. Sorry, but as Vernon Dursley put it: "There’s no such thing as magic!"‡


* I have no idea why it’s a Latin phrase, rather than Greek.

† Merriam Webster’s Online Dictionary (10th ed).

‡ Harry Potter and the Sorcerer’s Stone, Chris Columbus, Director (Warner Bros. 2001).

Little Blank Spaces

When a liability insurance claims office gets a report that one of its insureds has been in an accident, it immediately sets up a file, gives it a claim number, and assigns it to a claims representative. Typically, the company’s guidelines require that certain information about the claim be obtained before it will consider making a substantial offer. The required information includes basic documents about the accident (police report, witness statements, e.g.), plaintiff’s lost time and earnings from work, medical bills, medical records, whether the plaintiff has reached a medical end point, etc. I tell plaintiffs that the claims rep has lots of little blank spaces on his or her computer screen and, until those spaces are filled in, the money faucet will remain closed.

It follows that if you represent an injured plaintiff, you will want to find out what those blank spaces are and help the claims rep fill them in as soon as possible. If you don’t know what they are, ask. By thus accommodating the company’s protocol, you won’t turn a doggy case into a winner, but you should enhance your credibility with the insurance company in meritorious cases and help set the stage for a successful mediation.

For more on the same subject, see my article entitled, "Dealing with Insurance Company Claims Representatives," written in 2006.

Mediation as Anti-Social Behavior, II

I first posted on this subject last year (See "Mediation as Anti-Social Behavior," May 16, 2008) following a post by Geoff Sharp, in which he discussed Prof. Owen Fiss’s 1984 article, Against Settlement, 93 Yale L.J. 1073. Others have continued the discussion, which centers on whether justice is ill-served by people who settle their legal disputes without considering whether society as a whole would be better off if they fought things out in the courts. See, e.g., Michael L. Moffitt’s article, "Three Things to Be Against (‘Settlement’ Not Included) - A Response to Owen Fiss,"

In my earlier post, I deliberately put off discussing "whether individual litigants should be asked to spend their own money to carry society’s banners into battle (presumably for the honor of the thing)." This aspect of the issue appears to have been given little attention by those participating in the debate, but I believe it to be the nub of the matter. The idea that people who have a chance to quickly and efficiently resolve their grievances by settlement should nonetheless be encouraged to forgo that option for a protracted and expensive court battle seems foreign to any concept of justice with which I am familiar. To me, it is basic that the litigants’ interests are paramount, and if society wants a different benefit, society should bear the burden of getting it.

To help clarify the issue as I see it, let’s return to the Supreme Court’s decision in Brown v. Board of Education, a case that is often cited to suggest that settlement would not always be the ideal. To some, the proper question apparently is: "Would the country have been better off if the Browns and Topeka’s Board of Education had settled?" Perhaps not. But to me, as a practicing attorney and mediator, the proper question is: "Would the Browns and the Board and all the other litigants in the cases consolidated in Brown by the Supreme Court — the clients, i.e. — have been better off?" Would Linda Brown have been better off if, instead of litigating, her family had been able to resolve matters early on with the Topeka Board of Education?

This is not to suggest that litigants should be discouraged from fighting for a principle if they want to, and are able to garner the necessary support for their battle. I have never felt that litigants should be forced or coerced into settlement negotiations of any kind. See, e.g., my post of May 17, 2008, "Should Mediation be Mandatory?" There is certainly nothing wrong with individuals or groups choosing to fight passionately for a worthy cause. We need to remember, though, that while the creation of omelets may benefit society, the eggs are seldom better off afterward.

It is beyond the scope of this blog to do complete justice to this topic, but I think it would be beneficial if we started focusing at least some of the debate on it.

That’s My Money We’re Talking About!

This post is mostly for defense attorneys in tort litigation. Hopefully, however, plaintiffs’ attorneys will also gain some insight from it. It has to do with a twist on the so-called "endowment effect" described by Barry Goldman in The Science of Settlement: Ideas for Negotiators, ALI-ABA (2008), § 2.01(e). In a nutshell, the endowment effect is a quirk of human nature that causes people to dislike losing something they already have more than they like gaining something they don’t have. I.e., all else being equal, folks would rather not lose than win. It has been posited that the effect causes plaintiffs to make larger concessions in negotiation than defendants. See James A. Wall, Jr., & Suzanne Chan-Serafin, "Processes in Civil Case Mediations," 26 Conflict Resolution Quarterly 261, 266 (2009). The idea is that it is easier for plaintiffs to "give up" something they never had than for defendants to pay out something they do have.

Conversely, if plaintiffs have an "ownership interest" in an off-the-wall settlement amount fueled by unreasonable notions of value, they are more reluctant to accept less than otherwise. Smart plaintiff attorneys are aware of this effect and resist the temptation to over sell a case’s value to their clients.

Defense attorneys can take advantage of the endowment effect by making a reasonable offer in advance of mediation. By "reasonable," I mean something at the lower end of the range of values,* but still within the ballpark. See my discussion of so-called "reverse demand letters" in "Preparing (Your Opponent) for Mediation" (May 12, 2008). This offer should be made far enough in advance of mediation that plaintiff’s counsel has the opportunity to communicate some optimism to the client (e.g., "I’m encouraged by this offer; they’re not there yet, but I think mediation is likely to be productive"). Bolstered by the attorney’s qualified optimism, the plaintiff is more likely to start taking ownership of the offer. Given some time, the plaintiff will be inclined to start thinking about what he or she can do with that money. It stops being the insurance company’s money and starts becoming the plaintiff’s new pickup, remodeled kitchen, down payment on a vacation home, or — in some cases — the ability to take early retirement.

Given most people’s preference for not losing over winning, such a mind set is likely to lead to a greater reluctance to walk away from a settlement, even if the amount offered is "not quite there."


* See my post entitled "Ask Not for Whom the Bell Curve Tolls . . .."

Goodbye, Geoff

I want to add my voice to others who have expressed regret over Geoff Sharp’s decision to discontinue his very popular and always pithy web log (mediator blah . . . blah . . .). Geoff was one of the first to welcome me to the world of online posting last year. I will miss his insight.