They had retained me as a private mediator to
facilitate discussions regarding loan work-out issues
arising out of a loan by the bank to the development
firm. They had hit a wall on two issues: the length of
the extension of time for repayment of the loan and
the treatment of penalty interest. (They had already
agreed that penalty interest would stop accruing on
a date certain, but disagreed on whether penalty
interest accruing before that time should be added to
principal or treated as accrued, unpaid interest to be
amortized over the remaining loan term.)
The true barrier to negotiation, as was
revealed later in the mediation, was that the
Bank’s representative (let’s call him H, for,
“Hostile”), and the development firm’s principal (let’s call him T for “Taunting”), had a history
unknown to me despite thorough pre-media-tion interviews with both participants.
At the beginning of the mediation, H and
A were cordial – overly cordial in retrospect.
Each told his story and the history of the matter from his point of view. So far so good. I
H mentioned that T was habitually late on loan payments. T protested and asked H how H’s wife was
doing. H launched himself across the table toward T.
I reminded H and T that no violence or threats of
violence would be tolerated, and we should focus on
the issues at hand. T said he had done nothing other
than inquire as to a close friend and H had become
H came over the table toward T again.
I asked the participants if this was how they typically negotiated, and if so, why. H explained, through
clenched teeth, that he had hired T for a home
remodeling project some years before. During the
remodeling, T and H’s wife developed a close working relationship, which devolved into a close personal
I have never faced this type of underlying barrier to
communication before, and I feel comfortable in saying that it is fairly rare in commercial mediations.
What would you do under these circumstances?
Here’s what I did.
First, I asked H if he was going to keep lunging over
the table at T, and he assured me he would. Then I
asked T if he would quit needling H, and he assured
he would not.
I asked that each participant choose a similarly
empowered substitute participant with whom the
mediation could be re-scheduled. I then asked that
H and T leave twenty minutes apart. My assistant
supervised their departures.
is a shareholder in
Wilenchik & Bartness, PC, a Phoenix,
Arizona, law firm
specializing in commercial litigation,
commercial mediation, corporate, and
real estate law. She
has been a member
of ACR since 2012,
and is a Board Member and President-Elect of ACR’s
I had two mediations in one day, and grabbed a
quick sandwich between appointments. Too late,
I realized that the coffee shop lunch contained
a rather unfortunate amount of garlic. Actually,
a really unfortunate amount of garlic. I rushed
home to brush with baking soda, gargle with
mouthwash and hoped for the best when I ushered
the new clients into my office.
As I sat across from a couple deciding on the
details of their divorce, I realized that I still reeked.
I tried shallow breathing to avoid blowing air in their
faces, then speaking to the side. When it all became
too distracting and awkward, I interrupted a very
serious negotiation to fess up to my clients.
He immediately offered breath mints from his
pocket, while she made jokes. We all shared a laugh.
Then they settled.
While garlic didn’t agree with me, it helped them
come to agreement.
About the Author
(rhymes with bison)
is the mediator on
call for her roller
derby team, helping
that can’t be
resolved with a hip
check. She is an Advanced Practitioner
and an ACR member
since 2007. www.
I have never faced this type of underlying
barrier to communication before, and I
feel comfortable in saying that it is fairly
rare in commercial mediations.
The participants appeared professional. One represented a national bank, and the
other was the principal of a well-known, long-established local development firm.