Mediation is the intervention into a dispute by an acceptable, impartial and neutral third party who assists the parties in voluntarily reaching a mutually acceptable settlement of the issues in dispute.
The settlement can become binding if signed by the parties. It can be undertaken prior to litigation commencing or during the litigation process and what is commonly unknown is that legal representatives can be a support during mediation and remain involved to assist clients and ensure that their back is covered.
Anyone who has litigated a matter to the end of its course and even “won” in the eyes of the judge may well attest to the fact that their victory was pyrrhic as the win came at a cost that carried a significant element of defeat. In other words, although victorious in one sense, the heavy toll or the detrimental consequences perhaps emotionally or financially negated any sense of victory.
Further, litigation has cumbersome procedural safeguards and the best outcome is not guaranteed but is binding regardless. Parties “win” or “lose” whereas in mediation, parties often reconcile and therefore both feel that they have “won”.
Although litigation most definitely has its place as not all contentious issues are suitable for mediation, many are. Sometimes a matter is suitable to mediate but not ripe.
An experienced litigator will guide a client into mediation and settlement negotiations when the time is right.
Statistics currently show that if parties voluntarily go to mediation, between 70-80% of the disputes are settled. Even if settlement is evasive, issues in dispute are often narrowed.
A mediator starts the mediation process by hearing from each side before assisting them in
identifying the common ground and exploring different and creative ways of resolving their dispute.
The process is informal and has no set rules, although rules can be drawn up if agreed by the parties.
In short, the advantages of mediation are plentiful but include:
- it is quick to organise and put in to place;
- the process is speedy;
- costs are incurred but are considerably less than litigation or arbitration;
- the client retains control over the outcome of the dispute (unlike in litigation);
- the mediator is chosen by the parties;
- the proceedings are confidential and private;
- disintegrating relationships are often salvaged;
- emotions are aired and parties feel less “angry”;
- settlements can be creative and address needs, causes and complexities; and
- mistrust, poor communication and lack of skills can be bridged.
It is important to remember that at times litigation cannot be replaced with an alternative dispute resolution as the parties may need or want to know who is “right” on a particular point because it is a matter of considerable importance in other similar situations or for the conduct of their future relationship.
Sometimes a precedent needs to be created as a matter of public interest. Further if
the contentions of the other party are completely without merit, mediation may be perceived as an unfair or unreasonable opportunity for that other party to secure an undeserved concession or payment to which it is simply not entitled.
In our experience, what is important is that mediation is at least considered for all disputes and undertaken when it is suitable and ripe. It may well cost less both emotionally and financially.