COVERAGE MEDIATIONS: Are they really that different?

COVERAGE MEDIATIONS: Are they really that different?

   By Paul J. Van Osselaer, Van Osselaer & Buchanan LLP

 In his article, “COVERAGE MEDIATIONS: Are they really that different?” appearing in the January/February 2011 issue of Coverage, coverage mediator Paul J. Van Osselaer of Van Osselaer & Buchanan LLP asserts that coverage mediations are a special breed of mediation requiring special skills and then provides extensive guidance for lawyers involved in such proceedings.  The article notes that the potentially wide scope of a coverage mediation must be understood and that it often involves not just whether a loss, occurrence, or offense is covered by the insurance agreement, but the broader context of risk transfer in which indemnity agreements, extra-contractual claims, underlying litigation, additional insureds, other insurers, reinsurers, etc. may come into play. The article proceeds to explore threshold questions including:

 

  Should you mediate? (Contexts in which mediation might not be the right choice are addressed.)

 

  If so, what are your goals at mediation? (Examples of secondary mediation goals beyond reaching settlement are presented.)

 

  Is it the right time to mediate? (Indicators warning of premature mediation leading to unsuccessful results are imparted.)

 

  Do you have the right parties for the mediation? (The wisdom of including stakeholders, such as third-party claimants in liability coverage disputes, is discussed.)

 

In addressing the selection of the mediator, the article discusses each of these attributes that a good mediator should possess:  she or he should be respected, have an adaptable style, be knowledgeable on the topics and, principally, engaged in the process.  The article then turns to how counsel should prepare the mediator including with written joint and/or confidential pre-mediation submissions and with pre-mediation discussions. The article notes that the ethical prohibitions of ex parte communication with judges or arbitrators do not pertain to discussions with mediators.  It further discusses the two aspects of preparing the client for coverage dispute mediation: preparation on the merits and preparation as to the mediation process.  It also surveys preparatory steps lawyers should take. The article does this primarily through prompting questions for insured counsel and for insurer counsel to consider.  The article then turns to the conduct of the mediation itself providing information and guidance as to the opening comments by the mediator, opening statements, joint sessions of the parties where helpful, private caucuses, effective time management and special considerations for large coverage cases.  The article also imparts tips as to formulating the terms of the written agreement entered at the conclusion of mediation but before the formal agreement between the parties is drawn.  Lastly, consideration is given as to steps to take if the mediation proves unsuccessful.

 

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