My further (and perhaps unusual) observation is that perhaps the most powerful tool to help people deal with the many crises of our times, and the increasingly remote systems managing these crises, is their own mindset.
Often, those who survived debt and possibly even thrived during the recession and the pandemic, despite inadequate financial and legal resources, are those who knew or learned how to maintain a positive perspective and emotional well-being, despite the immense problems they faced.
Nevertheless, it is unfortunate that, despite having a valuable stock of trained mediators in Ireland at the time, we could not have set up a true debt-mediation system when the crisis hit. Instead, 13 years on, thousands of mortgage arrears cases are still stuck in the courts, as the great financial machine sells the debts to itself at an ever-greater discount.
Many who could withstand the adversity they faced over the years are still in their homes, while others have long since left, usually for less suitable dwellings - mostly because they could not stand the stress, uncertainty, and illogicality of it all.
At the start of this crisis, I trained as a mediator and, in association with other concerned groups, addressed the Government and banks - encouraging the establishment of a mediated debt-resolution process.
We drew attention to successful international examples during previous debt crises, including the Canadian Farm Debt Mediation Service. The best we got was the Personal Insolvency Act 2012, many years into the crisis.
This act was heralded as a mediation-type solution but – although it nods at mediation, and despite the best intentions of all involved – the legislation missed the opportunity to allow both parties to truly engage fully with each other through a mediator, so that they could each set out their issues, positions, and interests, and then create and own their mutually agreeable bespoke resolutions.
From the homeowners' perspective, the issue, position, and best interest of most homeowners in mortgage distress were both obvious and straightforward at all times.
- Issue – inability to pay, due to global recession,
- Position – strong need to keep their homes, as no alternatives were available, and
- Interest – to quickly restructure their mortgages to restore stability and peace of mind.
Sadly, there was also a strong emotional component for the debtor and, indeed, individual bank staff, who were forced to change their customer relationships from 'supporter' to 'enforcer'. This shock led to many mental-health issues and suicides on all sides that could have been reduced significantly by the early introduction of an empathic and mindful mediation process.
There was, however, no emotional component for the banks' policymakers, but we still believed that the bank's issue, positions, and interest were as follows:
- Issue – lack of repayments,
- Positions – to resolve this by either restructuring with customers or repossessing homes and selling them for market value, and
- Interest – if there was no housing market and a Government bailout, they would engage with, and find a solution for, each customer's circumstances.
From the Government's perspective, we believed that the issues, positions, and best interests were:
- Issues – potential bank collapse, mass repossessions, and homelessness,
- Positions – provide capital to save the banks and, in turn, assist banks to keep people in their homes, and
- Interests – recapitalising the banks and enabling them to engage with customers to restructure their loans; while at the same time avoiding 'moral hazard'.
Less obvious positions
However, a number of less-obvious positions and interests of the financial sector, and its influence over Government, became more obvious with the passage of time.
Firstly, banks had gotten too big, centralized, and technology-focused to even consider fairly mediated individual resolutions.
Secondly, the banks had so recklessly diminished their capital and control over their loan books in previous years that resolving these problems and protecting their relations with their international financial masters, were (and still are) the more important focus of Irish banks and the Central Bank – rather than customers.
So now, we are where we are, with the Government having spent large sums bailing out banks and then holding together the home-debt crisis through various unwieldy State and court processes that are still with us today.
How did we let it happen that people who could not afford their mortgages were faced with complex legal proceedings to defend, without real access to either legal aid or paid legal advice? Mediation and other methods of alternative dispute resolution (ADR) were the solutions that were not grasped.
This failure has created many problems for the courts system – not least adding significantly to a growth in access-to-justice problems, which, in general, have been highlighted recently by former Chief Justice Frank Clarke and Chief Justice Donal O'Donnell respectively.
Mindfulness, mediation and the law
I have had a valuable introduction to mindfulness and its connection with the law from all of this failure. I have found that clients who learned or already knew how to live 'one day at a time', focusing on whatever positives they could muster (and dwelling on the debt issue as little as possible, and only when confronted with the bureaucracy surrounding it) , fared much better than those who did not.
Some of them have, after a long time, secured good workable resolutions; others are still in their homes, waiting – but importantly, living – to the best of their ability.
Throughout my career, I had observed that it always seemed easier to get a good outcome for a client who sought legal remedy from a balanced emotional position, rather than one of anger or revenge only. But it wasn't until I saw so many patterns emerging with distressed borrowers that I began to understand this phenomenon as 'mindful-ness at work'.
Role of the solicitor
Traditionally, the role of the family solicitor involved dispensing legal advice, while being mindful of the emotional frailty of the client and softening any strict legal advice, depending on the client's needs. Now, however, the nature of the work we do gives little choice but to focus more on 'process', particularly in the area of dispute.
This is one good reason to consider mediation more seriously, since mindful mediation can genuinely assist clients to process their emotions and, as a consequence, resolve disputes and issues sooner.
An interesting new model of solicitor/client consultation has been developing quietly in the area of repossession law, where much of the time, all we as practitioners could do was give general old-fashioned advice, encouraging the clients themselves to interface directly with their banks, creditors, State agencies, and even the courts.
They were also comforted to hear that, despite the confusing legal framework around their problems where, in theory, the banks were entitled to be granted orders for possession of their homes, in almost all circumstances there were many process-based delays built into the system that did not override that right but, if correctly navigated, could keep the roof over their heads.
We were not representing clients or practising litigation as we knew it, but we helped a lot of people to stay sane and survive. Furthermore, the Government helped fund this approach with the Legal Aid Board-based ‘Abhaile’ scheme, which funds consultations and court support only, with no individual case handling.
The lesson for me from all this is that we, as a profession, should take a more holistic approach when engaging with those seeking our services – embracing not only our intellectual intelligence, but also our emotional intelligence, as part of our professional contribution toward helping to reduce stress for both our clients and ourselves.
To that end, it is very important that we all begin to look more closely at the client’s emotional state, advise accordingly and, depending on the nature of the issue, truly understand the benefits of recommending counselling – and certainly mediation or other forms of ADR – as extending far beyond merely ticking regulatory boxes.
We are not psychologists or counsellors, but we do encounter people at very stressful times in their lives. This has been acknowledged and studied in a developing area of academic review, focusing on the underdeveloped relationship between law and emotion in many areas, including contract, property, and debt issues.
Interestingly, this underdevelopment has been shown to have a strong bias in favour of the emotionless corporate body, which was all too obvious in the recent debt crisis. Mediation is far ahead of the law in recognising the power of positive emotion and mindfulness, and is a key to solving many of the recurring access-to-justice issues of our time.
Embracing legal mediation
Bill Holohan SC recently highlighted his quest to understand why solicitors are so slow to embrace mediation. I, too, have been considering this matter, and see two significant stumbling blocks.
First, it can be difficult for solicitors to understand our role in mediation, and how we can restructure our work and fee-charging practices to accommodate this. In my experience, mediations are far more successful when each side’s solicitor attends the mediation and work on finalising the mediated agreements as part of the process.
This work involves a significant amount of chargeable time, and can often mean that cases (particularly difficult and time-consuming ones) can be resolved much more efficiently and to the satisfaction of the parties involved.
The second big stumbling block in many unsuccessful mediated disputes is the mediator’s inability to help the parties overcome emotions that are blocking progress to resolution. Those who are most angry and feel most victimised often have the least satisfactory experiences in the mediation process – just as with litigation.
Studies in mediation introduce us to many mediation models – and different models are required, depending on the nature of the dispute and the mindsets of the parties involved. Often, particularly in commercial disputes, straightforward, fact-based, solo-mediation models prove effective.
In other highly emotionally charged disputes, co-mediated, mindful mediation models (using a mix of therapeutic and practical issue-resolving skills) help lead from emotional distress to emotional relief, which, in turn, creates an environment for mediating a practical resolution.
Gwyneth Paltrow drew world attention to ‘conscious uncoupling’ as a mindful way to resolve family-law disputes, which is an effective mix of therapeutic and practical legal mediation.
These models can assist the most distressed clients find an early resolution, rather than stalemate and long frustrating delays. Recent statutory and judicial encouragement, and now COVID-based delays, have given rise to even more reasons for solicitors and clients to seek the benefits of mediated early resolutions, instead of further clogging the continually overburdened courts system.
Mindfulness and mediation are much used words, but it is now time to embrace their underlying principles in practice.
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