Mediation in a Personal Injury Case: How It Works

Mediation is a negotiation with a referee. A neutral mediator, agreed by the parties or appointed by the court, hosts the session, usually at the mediator's office or a law firm, and manages the process of moving two sides from far-apart positions to a number both accept. The mediator has no power to decide anything; the parties settle or do not. Many courts require mediation before a case can be set for trial, and insurers generally welcome it because it resolves cases without the cost of trial.

It happens when both sides can value the case: after the medical treatment has ended or the prognosis is settled, after the depositions of the parties and the key witnesses, and often after the experts have reported. Mediating earlier saves cost but risks settling on incomplete information; mediating later costs more but narrows the dispute. Some cases mediate twice.

Mediators in injury cases are commonly retired judges or senior attorneys who have handled many such cases, and their value is in telling each side, privately and credibly, how a jury is likely to see its case. A good mediator is chosen for that credibility, and both sides' attorneys usually have views on who is effective.

The day begins, in most mediations, with a joint session in which the mediator explains the process and each attorney presents the case briefly. Some mediators skip the joint session, because presentations can harden positions. The parties then separate into rooms, and the mediator moves between them for the rest of the day. In your room are you, your attorney and anyone you have brought for support; in the other are the defense attorney and the insurance representative, and sometimes the other driver.

The mediator carries numbers. Your attorney makes a demand, usually at or near the figure in the pre-mediation submission; the insurer responds with an offer, usually low; and the numbers move in steps, with the mediator in each room pressing on the weaknesses of that side's case, the risk of trial, and the cost of continuing. Late in the day, if the gap has narrowed, the mediator may propose a number of their own, a mediator's proposal, that each side accepts or rejects without the other knowing until both have answered.

The day can be slow. Hours pass between moves, and the first several offers are not serious. The pattern is normal and is part of how each side tests the other's resolve. Most mediations that settle do so in the late afternoon.

Suppose your case involves a shoulder injury requiring surgery from a crash in which fault is clear, with $58,000 in medical bills, $11,000 in lost wages, and a surgeon's opinion of a permanent limitation. The insurer's last pre-suit offer was $45,000. After depositions, the case is set for mediation with a retired judge.

Your attorney's opening demand is $285,000. The insurer's opening offer is $60,000. By midday the figures are $220,000 and $95,000. The mediator tells your room the defense will argue the permanent limitation is overstated, based on the IME; the mediator tells the defense room that your deposition was credible and the surgeon will be a strong witness. By three o'clock the figures are $175,000 and $130,000. The mediator proposes $150,000; both sides accept.

A settlement memorandum is signed before anyone leaves. The release follows within days, the health insurer's lien is negotiated down, and the net is paid about five weeks later. All figures are hypothetical; the shape of the day, a large opening gap closing through the afternoon to a mediator's proposal, is the usual one.

Your attorney does most of the preparation; what you bring is realism and patience.

• Discuss with your attorney, before the day, the realistic range for the case, the lowest figure you would accept, and what the net to you would be after fees, costs and liens at each figure.
• Understand the liens: the health insurer, Medicare or Medicaid, and any medical provider liens come out of the settlement, and their amounts affect what you can accept.
• Expect the first offers to be low and the day to be slow; neither is a sign the case will not settle.
• Be prepared to speak briefly, if the mediator asks, about how the injury has affected you; the insurer's representative is evaluating you as a witness.
• Bring something to do during the long waits, and arrange the day so you are not watching the clock.
• Decide in advance how you will handle a mediator's proposal, because it comes late in the day with little time to think.
• Know that you can say no; mediation is voluntary in result, and a case that does not settle proceeds to trial.

Whether mediation is required before trial depends on the court: many state courts and most federal courts require some form of alternative dispute resolution, and some states mandate mediation in injury cases above or below certain values. Court-annexed programs may provide mediators at reduced cost; private mediators charge by the day, with the fee usually split. The confidentiality of mediation communications is protected by statute in most states and by the federal rules, with narrow exceptions.

State law also shapes the numbers discussed: damage caps where they exist set a ceiling the insurer will not exceed for non-economic damages; the rule on whether medical bills are valued at the amount billed or the amount paid, which differs by state, changes the economic damages figure; and comparative negligence rules determine how much any fault argument discounts the demand. In no-fault states, the threshold question can be the central risk the mediator presses on.

A settlement for a minor, or for a person under guardianship, requires court approval in most states, so a mediated settlement in those cases is subject to a hearing. Wrongful death settlements commonly require approval and allocation among beneficiaries. A structured settlement or a special needs trust, where needed, is arranged after the mediation and before the release is signed.

A case that does not settle at mediation often settles afterward. The day moves both sides' positions, and the mediator typically continues to work by phone in the following weeks. A gap that was too wide to close on the day often closes once each side has had time to reconsider with the other's final number in hand.

If it does not, the case proceeds to trial on the court's schedule, which may be months away, and the parties continue to prepare. Some courts order a second mediation closer to trial. Settlement remains possible at any point, including during trial, and a case that mediates unsuccessfully is not a case that will necessarily be tried.

The decision to reject a final offer and go to trial is yours, on your attorney's advice. It weighs the offer against the realistic range of jury outcomes, the cost of trial, which comes out of the recovery, the delay, and the risk of a verdict below the offer. An attorney who handles injury trials will give a candid view, and the mediator's private assessment is part of the information.

Mediation is where most filed injury cases resolve, and how it goes depends on the preparation of the case, the choice of mediator, and a realistic understanding of the range and the net before the day begins. It occurs in a case that has been filed, which means an attorney is already handling it. At an earlier stage, the question is what the claim is worth and whether it will need to be filed.

Ask Legal Matters is a free claim-review request service, not a law firm. Requests may be shared with independent attorneys and legal services partners who handle inquiries in your state, and an attorney must evaluate the facts before anyone can say what the claim is worth. If you have an injury claim and want to understand the process ahead, you can request a free claim review.

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