What is Mediation?

Mediation is an informal dispute resolution procedure used as an alternative to going to court.

Parties in dispute can appoint a mediator to act as an independent neutral to help resolve their issues.

A mediator will help the parties to find an acceptable solution to their dispute through negotiation. He will do this by meeting each party to explore the issues, review the facts and legal arguments, and, where necessary, challenge their views. 

A mediator will not give a binding decision: the aim is for the parties to reach agreement that is then recorded in writing.

A mediation can be arranged in a relatively short timescale and will usually involve one day of meetings at a neutral venue.

Why mediate? 

A successful mediation can help you to maintain or even resurrect important commercial relationships.

Resolution of a dispute by mediation is considerably cheaper and quicker than going to court.

When should you consider Mediation? 

Parties can refer their dispute to a mediator at any time – whether court proceedings have started or not.

It is better to consider mediation as early as possible in a dispute. The longer a dispute festers, the harder it is to settle.

A warning – don’t dismiss a mediation proposal unreasonably 

The courts wholeheartedly support dispute resolution by mediation as an alternative to court proceedings.  Judges have the power to impose financial sanctions on those parties who refuse to try mediation without any reasonable excuse.

If you are considering or involved in court proceedings, bear in mind the following:

  • consider at the outset of a dispute whether mediation is an appropriate way to resolve your dispute. If yes, suggest it to the other party;
  • if the other party make an offer of mediation, consider the merits of the proposal carefully. In most circumstances, mediation will be a reasonable way forward.

If in doubt, seek legal advice rather than risk sanctions.

Costs of Mediation 

The parties are jointly responsible for paying the mediator’s fees and the costs of the venue.

The cost of mediating is considerably less than going to Court. It includes the mediator’s fees, the cost of the venue and, if solicitors are appointed, their fees.

Various bodies offer a mediation service which includes finding a suitable mediator and arranging the mediation. Examples include CEDR and the ADR Group.  Should you choose to use their services, a fee will be payable.

A brief outline of the mediation procedure 

There is no set procedure for conducting a mediation. A mediator is free to propose a procedure suitable for the dispute.

The following gives a brief outline of what happens at a mediation.

  • The parties must agree to mediate.
  • They appoint a mediator. If the dispute involves technical issues, they may choose a mediator with expertise relevant to the dispute.
  • A venue is chosen and agreed. A joint meeting room plus one room for each of the parties will be needed.
  • The parties review their case and prepare an opening statement. The preparation should include a review of the strengths and weaknesses in their case as well as consideration of the potential costs of the dispute. Parties should ensure they know their ‘bottom line’ or ‘best offer’.
  • The mediator will contact the parties before the allocated mediation day to introduce himself and to confirm the practical arrangements.
  • On the day of the mediation, the mediator will greet the parties and show them to their individual rooms. After discussions with both parties, the mediator will bring them together and invite them to give a short presentation of their case. This is a good opportunity for parties to explain their position without interruption.
  • After the opening session, the parties will go back to their rooms and the mediator will ‘shuttle’ between them gradually helping all involved to gain a better understanding of the issues.
  • The mediator will only reveal information to the other side, if given permission.
  • If and when an agreement is reached, the parties will write out their agreement and sign it on the same day. It is therefore important that the person with authority to settle the dispute attends the mediation.

Parties must sign the agreement for it to be binding 

Any agreement reached at the mediation is not binding unless the parties enter into a formal written agreement. The mediator will usually help with the drafting but you might want to seek legal advice before signing such an agreement.

Once signed, the agreement is a binding contract.

What if no agreement is reached 

The mediator will encourage the party to continue their dialogue after the mediation finishes. It is common for disputes to settle soon after a mediation.

Are lawyers needed? 

There is no requirement to be represented by a solicitor at a mediation.  

However, if the dispute is complex or there is a substantial amount of money at stake, you might want to seek legal help with preparing for the mediation.

Even if you decide not to instruct your solicitor to attend the mediation, it is prudent to ensure they are available on the day to discuss by telephone any agreement reached before signing.

For more information on alternative methods of dispute resolution such as mediation, contact Christopher Burke on 0161 684 6941 or email christopher.burke@pearsonlegal.co.uk

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