The Workings of a Mediation

Recently, we participated in the mediation of a case involving five parties, the design of a new sewer line and the damage to an existing storm drain line. In short, a municipality engaged an engineering firm to design a sewer line extension that was supposed to run parallel to an existing storm drain line. The municipality also hired a general contractor to install the new line. The general contractor, in turn, hired the surveyor to layout the engineer’s design in the field. The general contractor also hired a blasting contractor to detonate explosives according to the surveyor’s field layout in order to make the ground easier to excavate. The explosive charges were placed too close to the existing drain line and the line was subsequently damaged. Needless to say, each party was blaming another. When it came time to mediate the case, each party had drafted its position for the mediator. The mediation was begun with each party in a separate room. The mediator spoke with each party for literally a few minutes to make sure he had an idea of what each party’s position was. Afterward, the negotiations began. In a mediation, it’s not about right and wrong or getting justice, it’s about settling the case. The mediator’s job is get everyone involved to agree on a settlement regardless of position. In the end, all of the defendants contributed some monetary amount to the repair of the drain line. In return, the defendants were able to leave without fear of further legal entanglement in this situation. The case was closed. It should be noted that monetary amounts are often associated with a degree of guilt (otherwise why pay anything?). Unless there is a very strong feeling of innocence, contributing to a settlement is a compromise between settling the case for an acceptable amount and going to court where damages can be imposed at much higher amounts in addition to court costs and attorneys fees.

Recent Happenings

1. Attended the National Truck and Heavy Equipment Claims Council conference. The conference was held from October 1^st to October 4^th in Savannah Georgia. R.J. Hill Consulting participated in the trade show.

2. Visited with the Chattanooga and Tri Cities Claims Associations in Tennessee; was asked to be the guest speaker for the Tri Cities meeting.

3. Participated in mediation involving municipality, engineering firm, surveyor, general contractor, and the blasting contractor. Case was settled with all defendants contributing to the repair of a damaged storm drain line.

4. Conducted examinations of two diesel trucks, one involving an alleged faulty fuel filter replacement and a fire in the other truck.

5. Conducted exam of small space heater involved in residential structure fire to determine if heater was defective.

Hired Guns

Figure 1 Leaking shower valve

We recently investigated the cause of damage to a local residence involving a water leak.  You would think that a water leak would be obvious, and it was, but the cause of the water leak wasn’t.  The water was found to have  been coming from a bathroom shower valve.  It seems that water was leaking from the valve because of a broken plastic piece of the valve stem housing.  The valve is shown in figure 1.  The valve was later removed by the insurance company’s restoration contractor and turned over to an engineering firm for examination.  The engineering company later determined that the valve contained a manufacturer’s defect in the form of a poorly formed plastic component.  The report also stated that no indication of installation error was found.  It should be noted that there were only three modes of failure possible: installation error, manufacturing defect, or a freezing episode.  It should be further noted that this incident occurred in January when temperatures were cold enough to support a freezing scenario.  The expert’s engineering report did not mention a freezing scenario as a possibility of failure. Why?  If the report had mentioned the possibility of damage by freezing, then the insurance company’s case would have been severly weakened.  By not including the possibility of freezing in the report, the insurance company could file suit against the general and plumbing contractors and increased their chances to recover what it had to spend in order to repair the residence.  The expert’s report was clearly written in order to substantiate the insurance company’s position without consideration and explanation given to all possibilities of failure.  As a result, it became clear that the opposing expert was a “hired gun”, someone paid to testify on their client’s behalf regardless of the facts.  These are the kinds of people (and companies) that should be avoided at all costs.  They can be discredited easily because of their lack of consideration for all the facts.  The case was later settled out of court for a fraction of the plaintiff’s originally claimed damages.