Mediation has become a popular form of Alternative Dispute Resolution (ADR) in recent years. In many cases, it provides a mechanism for parties to avoid lengthy, expensive court proceedings and reach a settlement of their issues without causing detrimental damage to existing business or family relationships.
Mediation is a process whereby the parties work together with a neutral third party to explore the issues in dispute with a view to negotiating a settlement. It is voluntary and confidential, with the parties retaining control over the process. In that respect, the parties agree to a time, date and venue for the mediation and together they appoint a neutral third party to facilitate the negotiations, called a mediator. The mediator’s role is to facilitate communication and narrow down the points of contention between the parties. The mediator encourages the parties to negotiate however remains impartial throughout, therefore they do not adjudicate on the issues or provide any advice. If the parties reach an agreement on the day, their lawyers can draft a legally binding contract for them to sign and the matter can be settled quickly. On the other hand, if the parties cannot settle the matter they are free to walk away from the mediation at any time.
There are many benefits to mediation which make it an attractive alternative to litigation, some of which are discussed below:
By including a neutral party in settlement negotiations, mediation often improves the communication between the parties. The issues are narrowed down and each party’s interests are considered which can bring clarity and a fresh perspective to the matter. Mediators are skilled at handling different negotiation styles to foster constructive discussions. This is especially important where business or family relationships are involved as mediation can help to preserve these important connections.
In the majority of cases, the parties will agree that the mediation should be confidential. This prevents either party from disclosing any information in connection with the mediation without the other party’s consent. The mediator is also bound by the confidentiality agreement. Confidentiality enhances communication and allows the parties to explore the issues without concern that information can be used against them at a later time.
- Control and flexibility
The entire process is controlled by the parties to the mediation. They are free to select a mediator and organise all aspects of the mediation with the help of their lawyers. The parties control the outcome and are not bound by the process. Either party may walk away from the mediation at any time. It also gives flexibility in terms of their settlement options as they can create an agreement to benefit all parties, in contrast with court rulings which are generally one sided.
- High success rate
Mediation is a highly successful form of dispute resolution. Many matters settle on the day or in the days after a mediation. Even where the mediation does not bring the dispute to a close, it serves a valuable purpose by pinpointing the issues and giving the parties a better understanding of their position and the overall case going forward.
Other factors to consider
An important issue to take into account when considering a mediation is the cost. Where successful, mediation is a cost effective process and an attractive alternative to litigation, which can become protracted and expensive. On the other hand, if mediation is unsuccessful you should be conscious that you may have to bear the cost of mediation as well as subsequent or ongoing court proceedings.
Where mediation is suggested by another party, it is important to exercise caution when deciding whether to reject that invitation to mediate. If the dispute ends up in court, a judge may deem a refusal to mediate as unreasonable in the circumstances and as a result the successful party may not win their costs in the proceedings. In that regard, even if you believe you have a strong case, it is prudent to give serious consideration to any invitation to mediate to avoid costs consequences later down the line.
If you are currently involved in a dispute and would like to review your options to resolve the matter, please feel free to contact our office for more information and advice at email@example.com.