4. Problem definition, agenda setting and exploration of issues
After the opening stage, the mediator will help the parties define the real issues in dispute.
These issues may be legal, factual, financial, commercial, personal or practical. For example, one party may say that it wants compensation, but the underlying concern may also involve cash flow, reputation, an apology, future business relations or certainty.
After the mediator and the parties have made their respective opening statements, and after any questions relating to those statements have been addressed, the mediator will usually help the parties set an agenda of issues to be discussed.
The mediator may use a visual aid, such as a whiteboard, flip chart or shared screen, so that all parties can see the proposed issues and agree what should be discussed. This can help make the process transparent and organised.
The mediator may help the parties distinguish between:
- issues which are essential to settlement;
- issues which are less important;
- misunderstandings which can be clarified; and
- practical obstacles which may prevent agreement.
The mediator may also explain the difference between “positions” and “interests”. A position is what a party says it wants, such as “I want HK$1 million” or “I deny liability”. An interest is the reason behind that position, such as cash-flow pressure, commercial reputation, certainty, avoiding litigation risk, preserving a business relationship or obtaining an apology.
Although parties may have provided a list of issues before the mediation, those issues are often framed by reference to legal or bargaining positions. The mediator may therefore reframe the issues in more neutral and mutual language, focusing on the interests that need to be addressed if settlement is to be possible.
For example, instead of framing an issue as “Party A’s failure to pay”, the mediator may reframe it as “payment arrangements and timing”. Instead of “Party B’s defective work”, the issue may be reframed as “quality of work and remedial steps”. Neutral wording can reduce blame and encourage problem-solving.
As part of this process, the mediator may help the parties identify areas of common ground. This can be important because settlement often develops from points on which the parties already agree, even if those points appear limited at first. The mediator may pay close attention to concessions or acknowledgements made by the parties and may use them as a basis for further discussion.
Common ground may include, for example:
- an agreement that the parties wish to preserve an existing business, employment, family or personal relationship;
- a shared wish to avoid court or arbitration because of cost, delay, uncertainty or confidentiality concerns;
- a shared wish to resolve the dispute as early as possible;
- agreement that certain facts are not disputed;
- agreement that some payment or performance is due, even if the amount or terms remain disputed;
- agreement that future communication needs to improve; or
- agreement that the dispute should be resolved confidentially.
If the parties are unwilling to acknowledge common ground at an early stage, the mediator may help by identifying obvious points of agreement in a neutral way. For example, the mediator may observe that both parties have chosen to attend mediation, which usually indicates that they are at least willing to explore settlement.
Once the issues have been identified and, where appropriate, reframed, the mediator may ask the parties whether they agree with the wording of the issues and the order in which they should be discussed.
During the discussion, the mediator may tick off or mark issues that have been dealt with. This can help the parties see the progress being made and focus on the remaining matters.
This stage is important because settlement is more likely if the parties understand what actually needs to be resolved, what interests lie behind their stated positions, and where common ground may already exist.
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