Navigating Through Challenging Mediations: Creating Value In The Midst Of Obstacles

Introduction

Mediation is a process in which a neutral third party assists the disputing parties in reaching a mutually acceptable resolution. Mediation is designed to be a confidential and voluntary process, free of the formality and adversarial nature of court proceedings. Due to the benefits that the mediation process has yielded, Rule 24.1 of the Rules of Civil Procedure enforces mandatory mediation in Toronto, Windsor, and Ottawa in certain civil actions, in addition to contested estates, trusts, and substitute decision matters under Rule 75.1. Mediation in Ontario has generally had a high rate of success among parties. According to the statistics compiled by Ontario's Ministry of the Attorney General, approximately 90% of cases are settled prior to trial.

There are however multiple reasons why a matter will not resolve at mediation. Among them are (1) the late service of expert reports or (2) the defendant's insurer taking a no-liability or defensible position, which may result in the insurer being unprepared to make a settlement offer at mediation. With respect to the former, it is common for insurers to have internal discussions, sometimes weeks before mediation, regarding the settlement authority for a particular matter, resulting in a decision being made on the amount of settlement authority to be afforded to the individual attending mediation. As a result, expert reports served days before the mediation by the plaintiff will not be accounted for during this assessment and very often sets up the mediation for failure. Therefore, timely service of expert reports is essential to enable the defendant to fully know the plaintiff's case and make a fully informed decision regarding its settlement position.

With respect to the latter, if the insurer is simply not prepared to make a settlement offer, the value of mediation will lie in trying to narrow and/or resolve some of the issues, better understand the parties' respective positions, and most importantly, allow the claims examiner to make their own assessment of the plaintiff regarding presentation and credibility in order to evaluate how the plaintiff will be perceived at trial.

Reason (3) as to why mediation may not result in settlement is simply the respective parties fundamentally disagree on the settlement value of the claim, with the result that the settlement authority provided to the claims examiner is insufficient to resolve the matter. While the settlement authority may be...