How a Judge Makes Mediation Work: Mandatory Mediation

By Donald L. Swanson

Recent expressions of concern about courts mandating mediation reminded me of a mandated mediation process that worked well: the City of Detroit bankruptcy.

An illustration of the success of mandated mediation in the Detroit case is this line:

The Bankruptcy Judge “put an end to the public bickering over the water deal by ordering the parties into confidential mediation.”

— from Nathan Bomey, “Detroit Resurrected: To Bankruptcy and Back” (April 2016).

Yet, many judges and mediation professionals are uncomfortable with the idea of a court order that mandates mediation.  And some are downright opposed to it.

Mediation is a “voluntary process,” it is said.

That’s true, of course.  But parties can still be ordered to engage in a “voluntary process.”  Such orders are, in fact, a common occurrence in many types and stripes of courts and cases.

If the Detroit bankruptcy stands for anything, it stands for the validity and value of mandatory mediation.  In fact, the entire mediation process in the City of Detroit bankruptcy is one gigantic mandatory process:

• At the very beginning of the case, the Bankruptcy Judge orders the parties to engage in mediation, appoints a lead mediator, and delegates authority to the lead mediator to order parties into mediation; and
• Then, the lead mediator exercises the full extent of authority granted.

And it works!  Mandatory mediation is credited for being directly responsible for the ultimate success of the Detroit case.

Early successes, in the Detroit bankruptcy, of mandatory mediation processes have a snowball effect.

First, there is one mediated settlement, then there is another, then another and, before long, the entire case is being settled through mandatory mediation.

That first mediation settlement, by the way, occurs in the lead mediator’s barbershop—they call it the “Haircut at the Haircut” (see  pages 162-65 of Bomey’s “Detroit Resurrected” book).

The facts of the matter are these:

• Detroit’s mandatory mediation process worked; and
• it worked exceedingly well!

Such facts should not be lost, and it should be viewed as compelling precedent in other bankruptcy cases for mandatory mediation processes.

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