It often is useful to group consensus building processes into two categories, based on the role of the neutral.
This is the major distinction, for example, between mediation and arbitration. Mediators facilitate negotiations; arbitrators hear presentations of the facts and make recommendations (binding or non-binding) as to settlement.
In practice, however, virtually all ADR or consensus building processes are used as tools in the larger context of voluntary settlements. Thus, negotiation remains the central mode of communication between parties, around which the varied procedures are structured. This is fairly self-evident for mediation, but it also is true for processes such as non-binding arbitration or early neutral evaluation where the neutral writes an opinion. Parties in litigation, in particular, find that their settlement negotiation efforts may break down over disagreements over factual issues or over different predictions about how the judge will decide a matter of law.
Mediation, generically, is negotiation with the assistance of an impartial person who has no stake in the issues in dispute. Broadly defined, negotiation is common in all aspects of our lives and for all kinds of disagreements, large and small. However, negotiations are often difficult to organize and conduct successfully. As a result, mediators increasingly have been called upon to help parties convene negotiations, to prevent impasse during the negotiations, or to assist parties to continue when their discussions have broken down.
Mediation of environmental and public policy disputes has taken on discrete forms, depending on the administrative or judicial context and the stage of the dispute. Some of these variations have become sufficiently formalized to be given different names. In addition to mediation of settlement negotiations, these include negotiated rule-making, policy dialogue, joint fact-finding, facilitation, and partnering.
- Negotiated rule-making – in which an administrative agency convenes representatives of the regulated industry, public interest groups, and other stakeholders to seek agreement on either the elements of or specific language for a proposed regulation, prior to initiating notice and comment under the Administrative Procedures Act.
- Policy dialogue – in which consensus is built on regulatory or legislative policy, in a manner similar to but less formal than a negotiated rulemaking. (Some policy dialogues are conducted under the Federal Advisory Committee Act, when sponsored by a federal agency, while others are sponsored by private groups for more informal purposes.)
- Joint fact-finding – an approach to dealing with the technical complexity of the issues and scientific uncertainty, where this creates obstacles to agreement. Parties discuss what factual questions they believe to be relevant to the decision, exchange information, identify where they agree and where they disagree, and negotiate an approach to seeking additional information, either to fill gaps or to resolve areas of disagreement.
- Facilitation – in which a facilitator increases the potential for dialogue and productivity in public meetings or informal workshops by helping keep the discussion on the agenda, encouraging participation by all participants, maintaining a constructive tone, and summarizing areas of agreement or disagreement, as needed. (Facilitation is increasingly integrated into a wide range of administrative procedures or private initiatives.)
- Partnering – in which a project sponsor and contractor meet prior to the start-up of a project (generally a construction contract) to discuss the specific tasks to be completed, how they will be carried out, what the criteria will be for evaluating that the project has been completed in a satisfactory manner, whom to contact if problems arise, and what communication steps will help resolve issues before a problem turns into a dispute.
Processes in which a neutral third party is called upon to offer some judgment on the issues in dispute include early neutral evaluation, mini-trials, and arbitration.
- Early Neutral Evaluation – Settlement negotiations for cases in litigation commonly break down over different interpretations of law and/or predictions about how a judge will rule. A basic negotiation concept is that parties do not (and should not) settle for less than they could achieve in the absence of an agreement (discounted for transaction costs). Thus, when one party bases its prediction of a favorable outcome in court on one set of legal principles or precedents and another party bases a contrary prediction of an outcome in their favor based on a different set of precedents or a different interpretation, they are unlikely to agree that any potential settlement is to their advantage. Early neutral evaluation procedures have been designed as a tool for overcoming this barrier. Before the parties get too far into a litigation process (usually shortly after a lawsuit has been filed but not always), the parties for all sides agree on another attorney (as evaluator) with extensive experience in the area of law in dispute, or retired judge, to whom they present abbreviated legal arguments either on the particular question of law or on the case generally. The neutral evaluator prepares an opinion predicting how a judge would rule on the matter. When the evaluator’s interpretation of the law raises doubts about the strength of one side’s position, it can trigger new settlement offers.
- Mini-Trial – Mini-trials can be described as a more elaborate version of early neutral evaluation. The barrier of concern is the same: different predictions of the outcome in court. In a mini-trial, three characteristics are important to highlight. First, the principals in each party generally attend personally; their involvement is assumed to help expedite a settlement. Second, attorneys for each side are given an agreed upon amount of time to present their best arguments before a private neutral and the principals. The assumption here is that each principal generally only hears his or her attorney’s arguments prior to a trial, perhaps giving an incomplete and/or inappropriately optimistic prediction of the outcome in court. Third, the mini-trial is conducted by a neutral agreed upon by all sides. After the presentations are completed, the principals meet privately in an attempt to settle the matter, with the neutral sometimes shifting roles from judge to mediator.
Arbitration – In contrast to mediation, the role of the neutral facilitator in arbitration is to conduct hearings and issue an opinion, either binding or non-binding by advance agreement of the parties. Arbitration often is considered when the legal issues are not in dispute, but what is being contested is their application to the different factual circumstances of the case.