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How the pandemic has changed construction litigation & what it will look like in the future

In addition to a full-time construction counseling and litigation practice, I also have an active mediation practice serving as the mediator. With stay-at-home orders and corporate travel restrictions due to the coronavirus pandemic, but parties wanting to keep the dates of previously scheduled mediations, I have recently found myself in a position where I needed to quickly learn how to conduct a mediation online.

After taking a webinar, watching several tutorials on how to work on Zoom, and practicing with the software, I conducted my first online video mediation. The mediation involved a construction dispute between six parties: a general contractor, two subcontractors, the carriers for the two subcontractors, the engineer and the engineer’s carrier. All told, there were 14 participants spread across seven different states.

The software enabled me to set up break rooms in advance for each party, as well as one for me to use if I wanted to bring individuals from different parties together for discussion, much like an in-person mediation. After having an opening session with introductions—just like we would in an in-person mediation—I then moved each of the participants into their respective break rooms and started to mediate the case.

 

 

The break rooms were comparable to conference rooms in an office, as the parties’ representatives could see one another and could see me when I entered into the break room. Also, when I was not in any one room, the participants in that room could securely and confidentially talk with one another.

Much like in an in-person mediation, where the mediator goes from conference room to conference room, I went from break room to break room while working the case, challenging the parties’ positions and carrying around and presenting counterarguments.

At times, I brought various participants together in my mediator’s break room to address factual issues. In the afternoon and at their request, I put the carriers and insureds in two separate rooms as we pivoted to discuss the numbers and began an exchange of demands, offers and counteroffers. This all went on for 9 hours, until we reached a settlement contingent on one carrier confirming authority for a number, which was provided to me the next morning. The following are some key takeaways from my experience:

1. Post-Pandemic Expectations

Online mediation will not entirely replace in-person mediation, particularly for larger cases. There will always be a benefit for having people spend the time and money to travel to a location and be required to attend and participate in person. Many cases mediated in person settle late in the day based on the sense of urgency of getting something done in view of the invested capital.

2. Increased or Decreased Trust

In-person mediation enables a greater ability for the mediator to develop a relationship of trust with the principals of the parties and the adjusters. My first online mediation benefitted from the fact that I knew many of the participants, as I had earlier mediated the dispute between the owner and the general contractor and because I also held video calls in advance of the mediation with those persons involved whom I had not mediated with previously.

 

Successful online mediations, I submit, require greater advance communication with the participants, as the video platform is not as conducive as personal interaction to developing trust and confidence with the stakeholders.

3. Travel & Time Savings

Online mediations save a tremendous amount of money in travel- and time-related costs. In my case, if not for the pandemic, 14 people would have been traveling to Pittsburgh, Pennsylvania, by car and plane and spending the costs for travel, lodging and meals, as well as investing an entire extra day of time that could be devoted to other business. Smaller cases involving participants from multiple out-of-town locations, in particular, will greatly benefit from online mediation.

4. Ease of Follow-Up

Many times, a case mediated in person does not settle because there is further discovery to be taken or it is simply not ready to settle, and a follow-on mediation will be needed. Those situations are particularly conducive to a follow-up, online mediation where, in some respects, we are picking up where we left off.

5. Flexibility for Participants

Online mediations offer additional flexibility to bring key stakeholders into the mediation during the mediation by video in a far more meaningful way than doing so by phone. For example, in my online mediation and at my request late in the day, the owner of one of the subcontractors linked in on Zoom and I put him in his company’s break room when I felt his project manager was not appreciating the risk to the company of not making an additional contribution to the settlement.

6. Hybrid Mediations

In the future, there will be hybrid in-person and online mediations, where some or most of the participants are together in person and other participants, such as high-level executives, adjusters for carriers or expert witnesses, are brought into the discussion by online video from the very outset of the mediation. This will save costs and enable more effective mediations. In closing, the advent and use of online mediations has been greatly accelerated due to the coronavirus pandemic. They are here to stay, and they are going to become far more prevalent.