Alternative Dispute Resolution (ADR) is any way of resolving a dispute other than through the normal court process. Mediation is the most common form of ADR. It is an entirely voluntary and informal way of settling a dispute. The advantages are that it is generally cheaper than going to court, will save time in dealing with a court case and as it is not governed by the strict rules of court, can lead to a more creative and satisfactory result. It is also entirely confidential.
Everyone who is party to a dispute is obliged to consider whether some form of ADR would be appropriate. Under the Civil Procedure Rules, if the court considers it appropriate, the court must encourage the parties to use ADR and to facilitate its use. For example, this could include putting the proceedings on hold while the parties try to settle their differences.
The courts take the view that litigation is a last resort. As a result, the court can require the parties to give evidence that they considered ADR and if there has been a failure to do so and a party has acted unreasonably in not considering ADR or refusing an offer to mediate from their opponent, then the court must consider that behaviour when deciding who should be responsible for legal costs ie if a party acts unreasonably, they are likely to be penalised by the court.
How does mediation work?
The mediator will generally be an experienced lawyer or expert in a relevant field, for example, a surveyor or accountant and will have specific mediation qualifications so that they are able to be accredited as a mediator.. The mediator is not there to make decisions but to facilitate negotiations which will hopefully lead to a settlement acceptable to all parties to the dispute. They will meet with the parties and their advisors at the negotiating table and to conduct a mixture of joint and private meetings to:-
- Clarify the issues
- Analyse the risks of continuing to court
- Promote discussion of possible solutions
The aim of this is to enable the parties to better understand their respective positions and to bring them to a mutually acceptable solution.
Creative Solutions
Mediators cannot impose a solution on the parties as the process is not binding (unless an agreement is reached during the mediation itself). Rather than just look at the parties strict legal rights and obligations, the mediator will attempt to look at the parties’ interests generally and to reach a solution which can satisfy both parties, for example, re wording a contract or preparing a deed. This of course differs greatly from the traditional court approach of winning and losing.
Mediation explained
Is Mediation binding?
The mediation process is voluntary, non-binding and confidential. The parties can leave it at any time and continue with litigation. An agreement resulting from mediation can form a legally binding contract between the parties like any other negotiated agreement. No one can be compelled to reach agreement, and a decision is not imposed in mediation.
What sorts of cases are suitable for Mediation?
It is suitable for:
- Avoiding the risks of going to court
- Controlling the outcome of the case
- Saving the costs of legal proceedings
- Securing a more flexible result
When should Mediation be avoided?
It should not be used where:
- A court order or an injunction is required
- A legal precedent needs to be established
- There are allegations of fraud or deceit
When should Mediation be proposed?
Mediation should ideally be used to prevent disputes, or to intervene at an early stage. Failing that, Mediation is best used when all the parties are sufficiently informed about the case to be able to negotiate effectively. It can also be used as a last resort to avoid a Trial. If you are a party involved in litigation, proceedings will normally be suspended to allow Mediation to be tried.
Ground rules for Mediation
- The aim is to give the parties a framework in which they, along with the neutral third party Mediator can negotiate their own settlement.
- The Mediator must be well trained and conform to a strict code of conduct and ethics.
- The Mediator must instill confidence and trust in the parties that he is unbiased and not imposing a decision.
Mediation process
Once all the parties have agreed to mediate, a convenient time and location will be arranged and a Mediator appointed. The process is simple. It is this informality which gives Mediation many advantages over arbitration or litigation.
All parties to the dispute will be present at the Mediation and must be represented by a person with authority to settle the case. The Mediation begins with an open session with all parties present.
The Mediator begins by explaining the process as part of his opening statement. After he has answered any questions that the parties may have, each side is given the opportunity to describe the facts of the case and explain their position.
These explanations will usually include any relevant written materials, a description of any witnesses and a summary of their evidence. There are, however, no formal rules of evidence. These presentations give everyone the opportunity to fully understand the case so that they may effectively analyse their risks.
The Mediator then meets privately with each party and attempts to help them reach agreement. These meetings are entirely confidential and no information will be given to the other party unless expressly agreed. The Mediator will, however, act very much as a devil's advocate in asking you the tough questions about the strengths and weaknesses of the case.
How long does Mediation last?
A Mediation would usually involve half a day, or a full day. It is relatively rare even for complex cases, to last longer than a full day.
What does Mediation cost?
This depends upon the organisation providing the Mediator. However, because of the relatively short amount of time involved, Mediation costs will usually be assessed either at an hourly rate and divided between the number of parties, or there will be a day's charge for the Mediator, again to be divided between the parties.
A full days Mediation fee may be around £1,500.00 - £2,500. It would be unlikely that you would be required to pay another party's costs of a Mediation.
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