Legal Malpractice Considerations in Mediation

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Legal malpractice cases are often quite complex because they involve a case within another case.  Such claims often arise when the underlying case was not resolved in the manner that the client wanted, leading him or her to speculate on the possibility of improper action on the part of the attorney whom they hired.  In order to avoid some of the negative aspects associated with suing someone’s own lawyer, mediation can be used in place of litigation.

One of the complexities of a legal malpractice case is that the plaintiff has the burden of showing that he or she would have been successful with the underlying case had the lawyer not made the alleged mistake.  Since much of the law depends on a subjective analysis of the evidence, this can be a difficult burden to demonstrate.

Another complexity involved in legal malpractice cases is that an insurance carrier may be involved.  A carrier may be eager to settle the case if it believes that the cost to defend the case may be greater than the cost to resolve the case through mediation.  However, this also requires that the legal malpractice carrier send a representative who can provide settlement authority on behalf of the insurance company.

The stakes involved in legal malpractice cases are often high, including having the lawyer’s reputation on the line.  Additionally, the case may involve confidential communications.  As such, a malpractice case may involve sensitive information.  Mediation is a collaborative process that tries to move away from making inflammatory statements about each other that will simply provoke each other and instead focuses on resolving the matter in a peaceful manner through open dialogue.  If successful, the process often results in a faster and more affordable resolution than litigation provides.

August 15, 2016

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August 3, 2016

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Creative Ways of Handling Marital Property

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When parties are unable to reach their own decisions regarding how to divide their property, many courts often split the property evenly without regard to whether this split makes the most sense for the parties.  Through mediation, the mediator may suggest creative ways of determining how to divide marital property including:

Consider the Value to Life

Rather than focusing only on the monetary aspect of property, a mediator may suggest dividing property in a manner that takes into account the value that the property will add to each person’s life.  For example, if the couple has a marital home and a vacation home of very different values, the mediator may suggest giving each person one of the properties because each can provide a suitable residence to each spouse.  The same may be completed with vehicles and with recreational items. 

Adjust Spousal Support

Many courts do not use a specific formula to determine how much spousal support to award and instead look at a number of factors in determining this issue.  However, spouses are often better equipped to realize how much additional support will be necessary for the lower-earning spouse to maintain the same lifestyle.  The spouses can also consider trading off assets so that the spousal support obligation is reduced.  For example, if the couple owns additional residences that can be used as rental income, this amount of rental income can be deducted from the spousal support amount. 

Prolong Division

In some cases, it may not serve the parties’ best interests to liquidate assets immediately and divide them.  For example, the real estate market may be lagging behind and the parties may prefer to hold onto the property until there is new demand in the market.  Tax consequences may make it detrimental to liquidate stocks or retirement funds, so the parties may agree to an equalization later in time. 

How to Maximize Bankruptcy Mediation

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Bankruptcy is ripe for the use of mediation since creditors are already intimately involved in the process.  Through mediation, the parties can all work together to achieve a settlement that they will present before the court.  There are steps that the parties involved can take to make the best settlement possible, including:

Use the Mediator’s Expertise

Bankruptcy mediators are commonly former bankruptcy judges, bankruptcy attorneys and business people familiar with the bankruptcy process.  This unique experience allows them to fully explain the process of bankruptcy to both the debtor and creditor.  Additionally, the mediator can rely on this experience when conveying each party’s position to the other side.  With this specialized experience, a mediator can quickly pick up on valid points and funnel this information to the other side in a productive manner.

Be Realistic

A mediator will urge all of the parties involved to have realistic expectations.  For debtors, it is important that they understand the bankruptcy process and what is at stake.  For creditors, it is important that they know where their claim falls in relation to other claims.  If a client continues to hold unrealistic expectations, the mediator may be more apt to deliver this message because he or she may appear more authoritative than the other parties or their respective counsel.

Think Outside the Box

One of the biggest benefits of mediation in any context is its ability to find creative solutions to the legal issue at hand.  When a complex bankruptcy is underway, the parties may consider bringing third parties in who may have insight or ideas about how the bankruptcy settlement should be worded.  There may be a buyer willing to purchase part of the debtor’s property that may be folded into the bankruptcy settlement and that allows the creditors to walk away with a little more.  Creative solutions often help tie the underlying interests of the parties with the ultimate resolutions that are made in the form of provisions in the settlement agreement.