Architects who've never been involved in a professional liability claim should count themselves lucky—and knock on wood. Those who have know how quickly a lawsuit can turn ugly. Litigation typically takes on a life of its own, consuming the feuding parties emotionally and financially. And in the end, the winners often find that the settlement amount wasn't worth the disruption to them and their families. The fallout from a court trial is broader, too. After each side finishes bringing out the big guns, any lingering hope of mending a broken relationship is gone. For all of those reasons, nearly a decade ago, insurance companies began asking policy-holders to use mediation to settle claims out of court. It's a voluntary, nonbinding process that involves hiring an impartial third party to help resolve the conflict—usually within a day. Back in the late 1980s, when architects began to hear about the use of mediation to clear up disputes, most shied away from the idea. Even after it began to gain widespread acceptance as a speedy way to resolve charges in the areas of civil rights and consumer protection, architects continued to view it as a sign of weakness, as though it would signal to their opponent that they didn't have a strong case. Enter the litigation-happy environment that grew out of a number of failed condo projects in the 1990s, and that attitude began to shift. Architecture firms began to realize how expensive and time-consuming a court trial is. Nowadays, mediation is considered standard, and AIA contracts typically mandate mediation as a practical first resort.
Of course, not every case should be mediated. Frank Musica, a risk management attorney at liability insurance provider Victor O. Schinnerer & Co., Chevy Chase, Md., says that when there is a clear-cut case of designer error, it's better to rectify the problem immediately. Conversely, when it's obvious a design firm is being dragged into litigation frivolously—say an injured construction worker is seeking more damages than he could get through workers' compensation—those cases are usually successfully fought in court. Of the 4,500 claims among Schinnerer/CNA's policy-holders each year, less than 1 percent go to litigation. They're either settled or mediated—80 percent of them successfully. Even among professionals who make a living in the judicial system, mediation is part of the protocol. “If you get all the way to trial, judges are going to ask, ‘Have you mediated?'” says attorney (and architecture-degree-holder) Stanley Martin, a partner in Holland & Knight's Boston office. “If you say no, they're going to look at you sternly over the bench and suggest you do.”
the blame game The nature of clashes arising from design and construction snafus make them particularly well suited to mediation. Usually the quarrel is about work quality or cost, and the lines of responsibility for project management often overlap. “Mistakes get made a lot, and no one is perfect, so black-and-white seldom exists,” says Tom Gallas, a partner at Torti Gallas and Partners, Silver Spring, Md. Mediation is less confrontational and less threatening than litigation, and it gets everyone talking.
Gallas recalls a claim that arose after the firm had completed a large multifamily project in Tampa, Fla., a few years ago. According to the project's developer, the problem—inadequate head clearance on an exterior stair leading to a second-story apartment—would cost $125,000 to fix. The two parties agreed on a mediator—a former judge with construction knowledge—and Torti Gallas spent several days researching the file and preparing briefs with its attorney. On the big day, the judge got the two sides together to lay the ground rules and then sent them into different rooms. He spent time listening to each side's key points privately, and then reported back to the opponents. “He tried to get further information and share with us things that were salient to their point of view and [then] allow us a chance to rebut those, and vice versa,” Gallas says.
After ping-ponging back and forth for the better part of the day, the judge recommended a resolution. But it took several more rounds to reach a compromise: Torti Gallas would pay $35,000, based on the discovery that both sides bore some responsibility for the error, which arose from incomplete drawings. The stair's height dimension had been noted on one drawing but not on a subsequent one. “We never say our drawings are perfect or totally complete,” Gallas says. “If there was confusion, we maintain that that's what the request for information process is for—asking the architect to clarify.”
Still, Gallas admits, “We did a few things that weren't exactly right, and so did the developer. Each party going in thought it was more clear-cut against the other party than it turned out to be. The value of mediation was to bring out those other points.” And once each side was able to cut through the animosity and posturing—it took awhile, he says—the mediator was superb at drilling down to the real issues. “A lot of times, when it gets to this stage, people have to feel somewhat vindicated,” Gallas says. “It's always an ego deflator when you realize that, well, you're mostly right but not 100 percent, and it's reasonable that there ought to be some way of acknowledging that to your client.”
Not all powwows have a peaceful resolution, however. Alan Weiskopf, AIA, a managing partner at Perfido Weiskopf Wagstaff + Goettel Architects, Pittsburgh, wasn't impressed by his one mediation experience. The case, involving mechanical and electrical systems in a condo building that didn't perform up to specs, still isn't resolved. “The mediator didn't seem to have consensus-building capabilities,” he says. “I don't think he was forceful enough. You have to listen, but eventually you have to push people toward a resolution.” In this particular case, he adds, “it just didn't happen.”
the middle man Boston attorney Martin has heard it said, only half-jokingly, that the M.O. of mediators falls into one of three categories—hashing, trashing, or bashing. At one end of the spectrum are those who try to get people to hash out an agreement on their own. The trash-style mediator tries to plant seeds of doubt on the viability of the opposing positions. The bashers are those who knock heads and apply a little more force to get people to agree. “You have to have parties who are thick-skinned for that to work,” Martin says. For example, he once hired a tough-guy mediator, someone whom a lot of attorneys thought was rude, to successfully resolve a dispute between two hard-nosed contractors. “I think mediation is more likely to be successful when you look at the personalities of the clients and try to find someone who's going to be a good match,” he says.
Unlike architecture or law, there is no licensing board or even certification for mediators. Most who have successful practices have hundreds of hours of course training, but they need only a basic 40-hour course to begin, and many sign on with private alternative dispute-resolution providers (ADRs) that establish their own requirements, such as the American Arbitration Association (www.adr.org) or JAMS (www.jamsadr.com), which specializes in the construction industry. Although mediators come from all professional backgrounds, most are retired judges who bring credibility from 25 years on the bench. “While anyone can become a mediator, there's a huge difference between hanging out a shingle and getting hired,” says Los Angeles mediator and educator Lee Jay Berman, who heads up the Mediation Alliance. “This marketplace operates ... on a word-of-mouth basis.”