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What is mediation?

Mediation is a totally confidential and extremely efficient, without prejudice form of negotiation managed by a neutral third participant. Despite the ever-present alternative to litigation, a mediator will assist the participants to explore what really matters to them and how those dreams can become reality.

Mediation has also been described, rather intriguingly, as “the insertion of a human buffer between people who need assistance to interact with each other.”

Mediation leads to superior outcomes and in particular, it settles disputes in a way that litigation cannot. Success in litigation is solely about who is right in law. The legal system tends to see every dispute primarily in terms of financial value.

However, human beings usually have secondary agendas too.

Examples of these invisible influences are:

  • the determination of one or both parties to win at all cost
  • the need of a party to prove his ability to further advance his career or maintain his status
  • the feeling of a party that he is not being heard, or not appreciated, or simply misunderstood

There are many advantages of mediation. For most businesses, the following are the reasons why mediation is considered in the first place.

Mediation identifies value that is otherwise left on the table

Your mediator will try to identify the elements that are holding a party back from settlement and those encouraging a party to see the benefits that are obscured by a litigation approach.

The role of the mediator is to be a neutral observer who can cut to the heart of the matter in order to open up discussions as to how to resolve the dispute.

However, the parties come to the process voluntarily. The presence of the mediator assists in providing a neutral and safe environment where they feel comfortable to find a solution out of court.

Even though the mediator is not able to provide legal advice, the fact that he is a lawyer gives comfort in that the parties are likely to trust his impartiality and his ability to prevent psychological bullying by the other side.

Characteristics of mediation

What not to expect

The mediator will impose solutions.

  • The mediator will impose solutions.
  • The mediator will evaluate the comparative legal strength of the participants.
  • The mediator will knock heads together.
  • The mediator will provide strategic or legal advice to both parties.
  • The mediator will draw the final settlement agreement.

The mediator’s impartiality

By far the most important characteristic of the mediator’s impartiality. That poses questions throughout the mediation process and in particular on the day of a mediation meeting.

No two human beings are the same. When two of us come to mediation one participant is inevitably better placed to satisfy his/her interests than the other. Here are examples of such characteristics.

  • One may have the financial resources sufficient to support litigation if mediation fails. The other may not.
  • One may better understand the legal effect of each possible element of the dispute.
  • One may be a more persuasive speaker than the other.
  • One may be a bully.
  • One may be unusually sensitive and fearful.
  • One may have endured past experiences which have affected his/her attitude to this dispute.
  • One may have distracting issues elsewhere in their life which prevent full attention being given to the mediation meeting.
  • One may be subject to pressure to achieve a particular outcome and required by a third participant.

From the beginning, the mediator must identify and assess how best he can provide a “level playing field” in these circumstances. The mediator must walk a mountain ridge in creating and maintaining this balance without falling off either side in a way which could be perceived as impartiality.

However, whilst constantly searching for equality of opportunity to achieve a satisfactory settlement, it is most definitely not the role of the mediator personally to balance what I would call “personal” issues. The bully must be put in his place. The fearful person must be encouraged to speak. However, the mediator will not try in any way to balance the proposition that one participant has greater wealth or is able better to state her/his argument.

Mediation is voluntary

The participants have to agree to go to mediation. There is absolutely no compulsion. That means there can be no emotional antagonism to the process itself. The very fact of having come to agreement on this process alone starts to change the emotional response of the conflict participants towards the idea that cooperation might be a way out of their dispute.

Mediation is confidential

In a world where social media empowers the good, the bad, and the ugly, it is increasingly difficult to keep your personal and business affairs confidential.

To want to do so should not imply that your motive is devious or dishonourable – let alone unlawful.

Nonetheless, when an error or misjudgment or even an unpopular decision in business can provoke a hailstorm of unpleasant reaction to descend on the personal lives of yourself and your family, the importance of privacy becomes one of the necessary pillars of your success and happiness.

No-one necessarily even knows that you have been to mediation, let alone the outcome.

Cost consideration

Probably the single most important reason to go to mediation for a business dispute is the gigantic saving over the cost of litigation. No matter your financial strength, you are not in business to throw money away or to while away the hours waiting to be called to give evidence in court.

This is not just a question of the cash spend but, more importantly, the loss of management time. As you may already be aware, a substantial litigation dispute can tie up senior management for years

For a small business, the high cost of litigation simply puts it out of the question.

Increasingly however, mediation is driven by the courts. That is to say the pressure placed on a litigant by a judge is stronger and stronger. If a litigant refuses to go to mediation, as the law now stands, he or she may be penalised in not obtaining his costs even if he/she wins his/her case.

In contrast, a full day of mediation, allowing the mediator time at the start to assess the documentation and the legal issues, will probably cost less than 5% of the cost of litigation,

With mediation, you choose your settlement terms

A last-minute settlement at the “door of the court” puts you under extreme pressure to make concessions. Even if you get most of what you want, it is unlikely that you will be able to recover more than a small proportion of your legal costs from the other side.

There are plenty of other reasons why mediation is better than litigation, or even arbitration.

When you come to a mediation deal it is all your own work

In litigation your choices are circumscribed by the remedies allowed by law and of course by the perception of the Court of the facts that you put before the judge. The Court judgement is likely to be limited to an order relating to money, without reference to other areas of undoubted importance to you.

Your solicitor and/or barrister will also be diffident about complicating what he sees as the main issues.

That does not apply in mediation, where you can explore every avenue to obtain the best outcome for both parties. You are absolutely in charge. The outcome is what you have chosen.

As far back as 2005, Lord Justice Dyson said:

“Mediation provides litigants with a wider range of solutions than those that are available in litigation: for example, an apology; an explanation; the continuation of an existing professional or business relationship perhaps on new terms; and an agreement by one party to do something without any existing legal obligation to do so.”

Mediation is heading online

Human beings have been negotiating face-to-face for as long as the human race has existed. By comparison, online mediation has barely scratched the surface of our experience.

It is therefore hardly surprising that a traditional face-to-face mediation meeting tends to be a more comfortable environment for negotiating than telephone calls, email messages or an Internet conference.

Nonetheless, there are some excellent reasons why online mediation is growing exponentially as a suitable process for dispute resolution. It is not exactly replacement for traditional face-to-face mediation. It is rather, a box of additional tools which opens up avenues to use mediation whether traditional version is not appropriate.

  • An online mediation can usually be arranged more quickly than face-to-face mediation.
  • Written messages are usually more precise than spoken ones.
  • Time can be stretched out for an online mediation.
  • Online mediation can be used where the parties are unwilling to talk face-to-face or physically unable to deal with the arrangements and attendance at the venue.
  • Above all, online mediation overcomes problems of time and distance. That is perhaps the greatest reason for its increasing use, both nationally and internationally.

For more, see “Advantages of online mediation”

Long-term and continuing mediation

We mention long-term or continuing mediation for the sake of completeness. As a process, mediation is extremely flexible. There are no rules as to when or how it can be used.

Of course if you have a dispute which comes into one of the categories we have mentioned below you need to talk to your mediator about precise arrangements rather than simply booking a date in his diary.

Sometimes a dispute cannot be resolved in a single discussion. That could be because:

  • the subject matter is ongoing, as in a construction dispute which is holding up the entire project and which requires assessment by third participant experts, inspection on the ground or other features which will cause delay.
  • the precise terms of settlement can be calculated only conditionally upon the happening of some other event. Software, and high-technology manufacturing are often subject to this situation.
  • terms of settlement have to be approved by some participant or organisation who cannot easily be represented at a mediation meeting. This is almost always the case when one of the participants is a governmental organisation. However it can just as easily apply to a subsidiary of a holding company.

What we refer to as long-term or continuing mediation is any circumstance requiring multiple meetings over a period of time on account of the subject matter. International disputes constantly require continuing mediation.

The EU directive

Parallel with the increasing pressure to mediate imposed by the judiciary and supported by the Lord Chancellor we now have generally increased awareness of the EU Directive on Mediation which came into force in 2013.In our opinion it is most unlikely that our departure from the European Union will change this.

What are the steps in the mediation process?

For the sake of simplicity, we have divided the mediation process into five steps. These are:

  1. planning and information gathering before the meeting
  2. introduction and statement of position
  3. shuttling - the mediator moving between each participant individually to generate options
  4. final joint meeting
  5. recording the agreement

At the planning stage, the mediator works alone to gather information about your dispute to help you decide exactly what sort of mediation you would like and how long you should allow for it. You book a diary date.

At the meeting, the mediator makes introductions, explains the process, summarises the dispute as far as he or she can, and sets the rules of the process. He or she then asks each party to explain his or her position.

Possibly after allowing the parties to discuss and continue to negotiate, the mediator will separate the parties and engage in a series of private meetings.

The Mediator decides on the appropriate time to call the parties together to draw in the strings of agreement, finalise the precise terms and draw a binding settlement agreement.

An online mediation follows the same principles but far more flexibly because there are fewer constraints on fixed times, dates and number of hours of mediation time required.

What sort of business mediation?

There are a number of broad options available to you in dealing with your business mediation. The ways in which mediation can take place include the traditional face-to-face one-day meeting, shorter meetings when so required and of course the many possibilities of using telephony and online communication.

Boardroom and partnership mediation

Not all business disputes are between two companies.

Some of the most intractable problems arise within the company or any other unit of organisation which could as easily be a partnership, a sports club, or a governmental organisation.

In these cases the dispute’s often prefer to settle their disagreements around a table rather than traipsing off to some third-party premises on a distant future date.

Employment disputes

Employment disputes are a constant source of lost productivity in every organisation.

Although every business will have an in-house system for dealing with complaints and arguments between employees, it frequently happens that the problems are intractable and that the usual internal mechanisms are unsuitable or simply do not solve them.

Mediation is a perfect solution for employment related disputes. It may not be necessary to make the usual formal arrangement with diary dates many weeks ahead. Both sides will usually be very enthusiastic about settling the dispute at the earliest opportunity, before both the cash cost and the stress levels become unmanageable.

Involvement of your solicitor

The question of how far your solicitor should be involved in your mediation requires careful thought.

The starting point is that a solicitor in general practice has a fundamental duty to act in the best interest of his or her client and against the opposing interest.

He or she will therefore often have difficulty in reconciling his perception of his or her client’s chance of winning all that he or she wants in court, against a mediation event that might well settle only at some level of compromise.

The psychology of mediation

The soft skills of a successful mediator could be described as an understanding of psychology, intuition, empathy and other social skills that expand with experience of life.

Many professionals expand the soft skills required for their particular profession. That includes lawyers. Such skills are not merely necessary but critical for the success of a professional mediator.

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