Commercial Mediation - covering the basics

RR Updated
Commercial Mediation - covering the basics

Blog Tags

Search by Tag
Select existing or new tags and apply to your post.

Associated Listings

Member Listing

Mediation is familiar to most people these days, with an increasing number having been involved for varying reasons. It’s becoming a fast-growing business in the UK, and has grown in popularity particularly over the last few years.

 

The concept is easy enough to understand, which is part of the key to its success. It’s a voluntary service where the parties involved in a dispute get together to sort out their differences, with an independent mediator present to assist in the process, and with the goal of settlement by the end. Mediation is attractive because it’s flexible, usually cost effective and can be done without legal representation – in other words quite unlike Court proceedings. 

Rise in popularity 

Parties are encouraged to mediate in all manner of disputes, with the popularity of commercial mediation one of the fastest growing in recent years. CEDR, the Centre for Effective Dispute Resolution, recorded a rise of 20% in the two years to July 2018, reporting that £11.5 billion worth of commercial claims were mediated in that period. A more valuable statistic to participants, no doubt, is the success of the mediation process:  89% of claims in total will settle following mediation, with 74% settling on the day and the remaining 15% shortly afterwards. 

This surge in mediation has stemmed from reforms introduced by the Judiciary over many years. Settlement outside of Court proceedings is strongly encouraged by the Courts, who often complain that too many cases are being brought before Judges that could just as easily have been mediated earlier. Judges are now starting to penalise parties at the end of trial (usually by way of legal costs), who they believe have refused an offer to mediate without good reason. 

So, how does it work? Here’s what to expect. 

By the day itself, a mediator will have been jointly appointed. Many current or ex-legal professionals, such as barristers or Judges, choose to become commercial mediators, however, this is not always the case. From my experience, participants are equally content to choose a mediator with some background from the sector they are in, be that banking and finance, insurance, transport, agriculture etc. 

It is usual for the parties to gather together at the start of the day for the mediator to set the scene and for the participants to briefly summarise their position (they will already have exchanged position statements beforehand).

There is, however, a trend nowadays to do without this initial meeting, especially in highly fraught or emotional disputes. It is also not always practical to have the initial meeting – the last mediation I attended, our client had to call in via Skype because he was stuck in Spain, so we agreed to do without it. 

After this, the parties will break out into separate rooms, with the mediator ferrying between them, refereeing the process and, where necessary, providing their own input. It is important that participants feel they are getting the most out of it and that it is being conducted in good faith. Participants are free to speak their mind about the issues in dispute, since mediations are held on a “without prejudice” basis. 

If the mediation is well structured and done with good intentions, then all should be set for settlement before the day’s end. It is always sensible for the parties to formalise their settlement into a binding agreement before they part company. If, for whatever reason, the mediation is unsuccessful, then proceedings will continue, although as mentioned earlier, it will likely settle shortly after. 

Consider Your Options 

That’s pretty much commercial mediation in a nutshell. It’s also worth adding that mediation, although sensible in most cases, is not compulsory, at least not yet. Court proceedings remain the single most popular option for most disputes. It’s also worth bearing in mind that mediation is only one of many ways to settle a dispute outside of Court proceedings. 

We are always happy to discuss mediation with our clients, or whether there are other means of Alternative Dispute Resolution (“ADR”) to suit their circumstances. For the time being, however, mediation will remain the most popular form of ADR, in my view due to its simplicity and flexibility. 

If you have any questions, or you think we can help you, please don’t hesitate to get in touch. You can reach me on This email address is being protected from spambots. You need JavaScript enabled to view it. or call 01752 827120. Please also visit us online at https://www.nash.co.uk/business/commercial-dispute-resolution/

User comments

There are no user comments for this listing.
Comments