A version of this article first appeared in the Construction Law Newsletter, Volume 34, Number 3 (January 2018), coauthors Paul M. Lurie and Jeremy S. Baker

Want to Resolve Design and Construction Disputes Quickly?

Clients have spoken, and their in-house counsel, lawyers, and mediators now understand that clients want their disputes resolved quickly — faster than they typically are in traditional mediation and arbitration. Most construction and commercial disputes settle and are not adjudicated. Early settlements reduce expenses and save time that clients would rather devote to their businesses. Early settlements also reduce the uncertainty inherent in litigation and arbitration — uncertainty that is toxic to business interests. Preliminary conclusions coming out of the worldwide Global Pound Conferences are consistent with this anecdotal evidence.

Guided Choice Mediation Is Different

We suggest that users of mediation services consider a different type of mediation: Guided Choice Mediation. Guided Choice Mediation focuses on early and efficient dispute resolution. It was created by a prominent group of mediators as a public interest project, and it is described on its website.

Guided Choice is not a one-size-fits-all process. Rather, it is a collection of the best tools and practices used by the most successful mediators. Guided Choice works differently from traditional forms of mediation that focus only on the “settlement” and do not consider the timing and costs of the process. That is why settlements reached through a traditional mediation ancillary to pending litigation can be unnecessarily expensive and delayed.

Guided Choice, on the other hand, focuses on process and specifically what the parties need to be ready to negotiate a settlement. Guided Choice mediators know that the parties need certain facts an knowledge of the law to move toward settlement and face the challenges that human decisionmakers, usually working in organizations, face to move toward a settlement. When negotiations begin before the parties are ready, they frequently break down and the parties terminate the mediator’s services, even though everyone knows that most cases eventually settle and are not adjudicated. Guided Choice Mediation helps prevent the delay and breakdown of negotiations that occur in traditional mediation.

How the Guided Choice Process Works

Guided Choice recognizes that how parties prepare for negotiation is as important as what actually happens during negotiations. Because mediators may consult with the parties confidentially, mediators have a unique power and many tools to help the parties identify their needs and anticipate and avoid impasse. Only mediators can find out the drivers for all the parties agreeing to settle. Lawyers erroneously think they find this information through discovery, discussions with opposing counsel and reading legal briefs. Mediators who use Guided Choice know how to use those tools long before negotiations begin so that the negotiation process can adequately plan for all issues. This improves the likelihood of earlier settlement.

To determine whether a proposed mediator knows how to use Guided Choice Mediation tools, the lawyers should interview the mediator to determine if the mediator is familiar with these tools. Traditional resumes and emails from other lawyers may not provide enough information.

Seven Principles of Guided Choice Mediation

These tools include the following:

  1. The mediator conducts confidential investigations to understand what is causing impasse now and in the future. The mediator is open to seeking auxiliary confidentiality agreements with nonparties who are essential for settlement.
  2. The mediator is open to investigating the following subjects of inquiry, most of which the mediator can learn through inexpensive phone calls:
  • The information the parties need in order to settle, as distinguished from their needs for trial or hearing.
  • The necessary parties to a settlement and identification of the relevant decision-makers. It is important for the parties to understand the other side’s negotiation style. The parties may include insurers and subcontractors, vendors, design professionals, neighbors and governmental agencies. They usually require separate preparation for the process from the main players.
  • The likely impasse issues that may arise during negotiation, including legal and factual disputes and human behavioral factors.
  • The process (not the monetary number) by which the parties are reaching their positions. Many of the methods that parties use to predict court or arbitration outcomes are prone to error. These include internal investigations, expert opinions, use of decision trees, lawyers’ predictions, and decisions by organizational committees referred to as “Groupthink”.
  • The likely costs the parties will continue to incur until the case is settled. Costs may be monetary, or time-related, and include other business factors.
  1. The mediator encourages the parties, and necessary nonparties reluctant to mediate, that participation in a mediator-facilitated settlement process is in their best interest, regardless of when their dispute settles or is tried. Parties need to be reassured that agreeing to work with the mediator on a settlement process does not mean they will be forced to negotiate before they are ready — or before they have sufficient information to determine the amount of a fair settlement for them.
  2. After the mediator conducts a confidential investigation, he or she should identify the factors preventing settlement. The mediator then recommends a settlement process to the parties based on that diagnosis. The process should consider the parties’ uncertainty, anger, fear, sense of loss, biases, and heuristics, and whether to have joint negotiation sessions based on these factors.
  3. The settlement process should include pre-negotiation activities, including: (a) a collaborative information exchange, especially if electronically stored information is involved. If necessary, the mediator could facilitate this exchange; (b) Guided Choice “What If Scenario Planning” for each party to determine impasse issues that may arise and the ways any impasse might be resolved. “What If Scenario Planning” educates the lawyers and the decisionmakers so that they are not surprised by impasses; and (c) before impasse occurs, participants should explore methods to break it while negotiations continue. Methods can include seeking binding or nonbinding opinions from third party experts on liability and/or damages, along with obtaining opinions from existing Standing Neutrals or Dispute Review Boards.
  4. Proposed settlement scenarios should be explored as soon as possible and accompanied by proposed settlement terms. Frequently, settlements fall apart because the parties dispute the specific contract terms.
  5. Sometimes disputes do not settle at a single mediation event even if the event occurs over consecutive days. This is often the case when a mediation event occurs before there has been adversarial discovery. Guided Choice mediators educate the parties about what they can do to settle without the mediator’s help while also minimizing expense and delay. Most disputes do eventually settle, and Guided Choice Mediation helps them do so earlier rather than later.

Conclusion: Guided Choice Mediation Resolves Disputes

While most commercial cases eventually settle and are not litigated through trial, the process of reaching a settlement can be very expensive and time-consuming, especially in international or complex cases. Those costs expand in direct proportion to the time available to lawyers and experts before a case

settles. The Guided Choice process shortens the period to settlement and thus reduces expenses without compromising on quality. It allows parties greater control over their expenses and the outcome of the case. Because it is customized based on the circumstances, Guided Choice is useful in disputes of any size.


This publication is prepared for the general information of friends of Baker Law Group LLC in Illinois. It is not legal advice for you, or legal advice regarding any specific matter. Jeremy S. Baker is licensed to practice law only in Illinois. Under rules applicable to the professional conduct of attorneys in various jurisdictions, it may be considered attorney advertising material. Prior results do not guarantee a similar outcome.