July 15, 2015
Is your family on the verge of a serious breakdown due to events that came out of someone’s Will or Power of Attorney? Are people taking sides? Have conversations become screaming matches? Has everyone descended into a tense silence?
You may be in the midst of an Estate dispute.
Disputes in Estates can arise in a variety of ways:
- Dispute over a parent’s will?
- Disagreement about support being paid out of the estate for younger members of a blended family?
- Difference of opinions over whether property should be maintained or sold immediately?
- Unhappy about the Estate Trustee’s accounting for the assets?
When families begin to argue about these problems, the result can be the permanent destruction of that family. People take sides, lines become drawn and then suddenly, family members are permanently torn apart. However, that doesn’t mean that these problems can be ignored. Going to court to litigate over an Estate can also be costly in terms of money.
One alternative is Estate mediation. Estate mediation may allow the parties to a dispute an opportunity to reach a mutually agreed settlement before significant legal costs are incurred. It is worth noting that at one time everyone’s costs of estate litigation were paid out of the assets of the estate, this is now seldom the case, and frankly, most estates are just not big enough to justify the costs that might be spent.
Mediation is a process for people to settle disputes or lawsuits outside of court. In mediation, a neutral third party called a mediator helps the disputing parties look for a solution that works for them. Because mediation is private and confidential, family baggage is not aired in open court. The parties can speak more freely about what is truly bothering them. Many people find this process more comfortable and constructive than traditional litigation.
Mediators, unlike judges, do not decide cases. A mediator has no power to impose settlements.
The mediator’s role is:
- to facilitate constructive communications and negotiations,
- to help the parties gain a better understanding of their own interests and those of other parties,
- in the hopes that this leads to common understanding and mutual agreement.
Mediation is not for everybody. In Thunder Bay, unlike some court locations, mediation is not compulsory for estate disputes. The mediator costs money, as do the lawyers, so if settlement is unlikely, that cost might be unnecessary. Mediation also, in our experience, does not work well in cases where parties lack the information to make decisions; where there is a power imbalance; or a level of distrust too great for even the most skilled mediators to bridge. These factors should be considered and discussed with your lawyer before committing to mediation – the process works best with genuine commitment from everybody involved.
In situations where the parties have an ongoing relationship, which is often the case in estate disputes, mediation can be particularly helpful because it promotes cooperative problem-solving and improved communications that can smooth over rocky relationships.
The purpose of mediation is not to determine who wins and who loses, but to develop creative solutions to disputes in a way that is not possible at a trial. It is often said that a mediated settlement is better than a trial judgment, because after mediation, the parties know that it is a result they agreed with, rather than something imposed by an outsider. This may also be of great benefit in estate disputes, where family members may have no choice but to continue future relationships, and the absence of clear “winners” and “losers” can reduce future tensions.
Even if the mediation does not result in a complete settlement, it may be helpful if the parties gain a better understanding of the other side’s position, if it narrows or settles the issues or some of the issues, or can lead to an agreement on process to save time cost or aggravation on a process to resolve issues later in the proceedings. Lawsuits that do not settle at mediation continue through the court process, but we have seen cases where a settlement was reached after the mediation based upon groundwork done at the mediation.
The mediation may be held at any location that is convenient and acceptable to the parties, including the mediator’s office, the office of one of the lawyers, or a neutral location like a hotel boardroom. All parties must attend the mediation session. If a party is represented by a lawyer, the lawyer must also attend. A lawyer should not attend in the place of a party, because for the mediation to proceed, parties must have authority to settle the case, and the process of identifying interests works best if the people directly affected are present in the room.
Although mediation is an informal process, the mediator structures the discussion. Usually at the opening of the mediation, the mediator explains the mediation process and reviews the terms of the mediation, which are usually set out in a written agreement to mediate. All parties have an opportunity to present their side of the story, to explain what is important to them and often to ask questions. The mediator will help the parties to explore settlement options. The mediator may meet separately with each of the parties either before the session begins or during the session. These “breakout sessions” are often where a skilled mediator helps the parties understand the opportunities to settle, and their alternatives. The mediator however, does not give legal advice – that is why mediators prefer to have each side bring a lawyer.
Agreements reached at a mediation are set out in a settlement agreement and are legally binding. If a party fails to comply with a signed agreement, any other party to the agreement may make a motion for judgment if there is a lawsuit pending or commence or continue the legal proceedings as if there had been no agreement. Fortunately, this does not happen often.
Although you may believe that right is on your side and you should take your case all the way to trial to prove that you are justified, this is costly and there are many situations where estate mediation provides a more cost-efficient solution.