How much does the analysis of the law matter in a mediation? The answer to that question is that the law always matters, but a negotiated settlement is still feasible and often preferable even if one party has the more persuasive legal argument.
Litigation is very expensive and there is always some uncertainty of outcome. Indeed, a Los Angeles Superior Court Judge once told me off the record that the fastest way for him to be reversed on appeal was to grant a summary judgment motion.
There is much truth in the Judge’s comment. I once litigated a case involving an alleged failure to disclose material facts in a real estate transaction that occurred thirty (30) years prior to the filing of the lawsuit. I filed a simple and straightforward summary judgement motion on statute of limitations grounds -- an obvious bar to the lawsuit. The trial judge agreed with my position and granted summary judgment in my client’s favor. Unfortunately, the appellate court did not share the trial court’s view. The appellate court reversed the trial court’s decision finding that there was an issue of fact as to when plaintiff should have reasonably discovered the facts of her case.
I ultimately settled that lawsuit a whopping three years after the case was filed. Did I have a stronger legal argument than the other side? Of course, I did. Would the client have been better off if the case had settled earlier? Absolutely. Even when one side has the more persuasive legal argument, there is often benefit to an early settlement.
The lesson learned: A good mediation must explore the cost, time and expense of litigating the matter further even when one side has the stronger legal argument.