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A Mediator’s Dilemma: Navigating Legal and Ethical Crossroads

A Mediator’s Dilemma: Navigating Legal and Ethical Crossroads

In mediation, an unforeseen ethical dilemma can force the mediator to navigate complex legal and moral decisions. Consider a scenario where two people’s dispute over a car lease unexpectedly uncovers an unlawful agreement. As a mediator, should you proceed, adjourn, or terminate the mediation process?
Patrick Scott from the Strathclyde Mediation Clinic delves into contrasting viewpoints, drawing parallels with similar cases and exploring the nuanced ethical considerations. Through examining various perspectives, he prompts reflection on the role of mediators in upholding legal and moral integrity while facilitating resolution.

This article was first published in “Mediation Matters!”, the quarterly newsletter of the University of Strathclyde Mediation Clinic.

John and Anne had an agreement regarding the leasing and use of a car. Anne unexpectedly terminated the lease agreement and returned the vehicle, much to John’s dismay. He had contributed a lot of money to the deposit and the monthly rental of the car and, as a result of Anne’s conduct, the car was repossessed, and he lost his money. John sued Anne for a refund of his contributions and Anne defended the action. The Sheriff referred the case to mediation.

The mediators went through the usual procedure of pre-mediation meetings, and commenced the mediation in a joint session. At the end of the opening session, and with the emotion in the room escalating, the mediators suggested private sessions. During a private session with Anne, it transpired that the agreement between the parties regarding joint use of the vehicle was unlawful. What do the mediators do about this? Should they continue with the mediation, adjourn it to consider their position or terminate it? Are they acting unethically if they continue with the mediation and assist the parties in getting to a resolution regarding the contributions made by John, or are they endorsing an unlawful situation? There are conflicting views on this, and I will set out some of them.

It is trite that mediators should not assist parties in the conclusion of a settlement agreement that is illegal or immoral. Omer Shapira (1) has the following to say in this regard: “Mediators’ responsibilities are not only to the parties but also to the profession and the public. Mediators are responsible that the process of mediation not be abused and that its outcomes not harm important social interests such as the rule of law, the rules of critical morality, and the institution of mediation. Although the parties have a right to self-determination, they cannot legitimately expect mediators to assist them in concluding agreements that are illegal, immoral, or unconscionable. Self-determination as an ethical norm does not extend to such conduct. Moreover, the profession and the public expect mediators to prevent such mediation outcomes because mediators are perceived, at least partly, as responsible for outcomes that were reached in a process that they conducted, outcomes that they could have frustrated by terminating the process.” (2)

In the present example, however, the unlawfulness relates to the agreement giving rise to the claim and not the settlement agreement. Is there a difference?

Mediators are responsible that the process of mediation not be abused and that its outcomes not harm important social interests such as the rule of law, the rules of critical morality, and the institution of mediation.

In Ellen Waldman’s Mediation Ethics, she discusses a mediation conducted by Julie Macfarlane. (3)

In summary, the scenario in that mediation was the following:

Two parties entered into a loan agreement, with the borrower using the money to fund a small business venture. The venture failed and the borrower could not afford to repay the loan. The lender sued in the small claims court and the matter was referred to mediation. At the end of the joint session, it transpired that the borrower’s business venture involved the import and sale of illicit drugs. It appeared that the lender was aware of the illicit nature of the venture.

The mediator assisted in facilitating a settlement agreement between the parties. The ethical question which arose is should she have continued with the mediation, being aware that the debt repayment issue arose out of a failed drug deal. Waldman shares the views of three commentators on this question.

What is interesting, is the different approaches adopted by the three commentators. What would you do?

The first, John Bickerman (4), opines that, whilst in the case of “some ethical issues, the line between ethical and unethical behavior can be fuzzy………there can be no haziness over conduct that crosses the line into sanctioning, participating in, or hiding criminal behavior”. (5)

He is of the view that the mediator should not have continued with the mediation. Bickerman seems to labour under the impression, however, that the illicit drugs deal had not been discovered by the authorities. This is not correct, and it was the fact that it was uncovered, and the consignment confiscated, that gave rise to the debt not being able to be repaid. It is not clear to what extent this affected his conclusion.

The second commentator, Jeremy Lack (6), expresses a different view. Whilst conceding that certain aspects of the mediation are dubious, he believes that, in circumstances such as this case, each mediator should rely on his or her own values and ethics. It is clear from his comments that he distinguishes between the illegality of the transaction giving rise to the dispute, and the legality or illegality of the settlement agreement. His view is the following:

“The mere fact that a past crime was attempted should not prevent the mediator from helping the parties to resolve the matter of their perceived debt even if it is not legally enforceable. If both parties believe there is a debt to be repaid (even if it only a matter of honour among thieves), then their subjective perception of an ongoing dispute justifies their perceived need for a mediation and the need to resolve matters between them with respect to the future.

The question becomes ethically challenging only when the mediation itself may facilitate the commission of a crime.” (7)

The final commentator, Julie Macfarlane (8), was actually the mediator in the case. Macfarlane states that her objective was to assist the parties in finding a lawful and non-violent solution to their dispute. She was satisfied that their proposals to resolve the dispute involved no illegal behaviour.

She draws the distinction between furthering illegal conduct and resolving the consequences of such activities. Mediators should trust their moral judgments. The one question raised by Macfarlane is, however, whether taking on a case such as this may affect the reputation of mediation in the eyes of the public. (9) Even then, she believes that she was correct in continuing with the mediation. By mediating this dispute, the parties were being assisted in dealing with a failed transaction. Whilst the transaction was illegal, the settlement agreement was not. Macfarlane prioritised the interests of the parties above those of the profession, in circumstances that were not morally repugnant to her.

What is interesting from the above, is the different approaches adopted by the three commentators. What would you do?

(1) Omer Shapira, A Theory of Mediators’ Ethics (Cambridge University Press 2016).
(2) Ibid, 380-81.
(3) Ellen Waldman, Mediation Ethics (Jossey-Bass 2011) 182. Julie Macfarlane is a Professor of Law, University of Windsor and Visiting Professor at Osgoode Hall Law School.
(4) John Bickerman is an internationally recognised mediator, dealing with insurance and commercial disputes. He is based in Washington, DC.
(5) Waldman, 183.
(6) Jeremy Lack is a lawyer and mediator, practising in various countries, and specialising in international commercial disputes.
(7) Waldman, 188.
(8) Ibid, 191.
(9) Ibid, 194.

Patrick Scott SC served as Chair of the Board of the University of Strathclyde Mediation Clinic for three years, from 2019 to 2021. He is now the newly appointed editor of the Clinic’s newsletter, “Mediation Matters!”. Patrick is a lead mediator with the Strathclyde Clinic and, in particular, mediates matters from the Kilmarnock Sheriff Court. He is on the Scottish Mediation Register and also serves on the mediation panel of the Scottish Legal Complaints Commission.

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