Mediation is a form of alternative dispute resolution in which a neutral third party assists the parties to reach a negotiated settlement of their dispute. It is a confidential and flexible process, where the parties retain control over whether to settle and the terms of any settlement.
Many contracts contain mediation provisions, generally as an optional step in an escalating dispute process, and it is a suitable process for resolving almost any kind of dispute.
The most common form of mediation is known as ‘facilitative’, which is where the mediator works to facilitate agreement between the parties but does not evaluate the merits of the parties’ positions or determine the outcome. Mediation may also be ‘evaluative’, which is where the mediator assesses the claim and the strengths and weaknesses of a case. This form of mediation, or a combination of the two styles, is becoming more popular as parties benefit from the mediator’s expert input.
Mediation allows parties to better understand each other’s position and work together to consider opportunities for resolution. The process allows more creativity over settlement options, as the parties are free to agree an outcome that is not available to them under their contract. This is in contrast to formal proceedings that tend to have limited options and binary outcomes.
There are many other benefits of mediation over other forms of dispute resolution, including:
- Costs. Mediation is one of the most cost-effective forms of dispute resolution.
- Speed. Mediation can be arranged quickly and can be as short as a few hours.
- Risk. Mediation is a low-risk process. As it is voluntary, the parties may withdraw from or terminate the mediation at any time. As such, there is frequently nothing to lose by attempting to resolve your dispute via mediation.
- High success rate. Mediation produces a settlement in 65% to 85% of cases. Additionally, as participants shape their own solution, each party is more likely to see the outcome as a success.
- Flexibility. The parties have the freedom to select their mediator of choice, set the timetable and format of the process, and to be closely involved in the process. These are not options in litigation, where judges are assigned, remedies are limited, and clients have little control over the process and outcome.
- Repairing relationships. Quite often, by the time parties have reached this stage, communications between them have broken down. A neutral mediator can act as an intermediary to help repair relationships and restore amiable working conditions. This is particularly important where parties are in long-term contractual relationships, such as PFI agreements.
The most effective mediations are those where the parties have taken the time to carefully prepare their position, consider the other party’s position, and weigh up the pros and cons of potential resolution options in advance of the mediation session.
Please contact us here for further information about the mediation process, including how to prepare for a mediation.