Article

Mediation – a means to an end

At the beginning of a business’s life, or even during times of plain-sailing, it is often difficult to foresee any reason for a future dispute with stakeholders to arise. However, should a business find itself in a disputed position, it is important to know the options that are available.

Often when people think of resolving disputes they think of litigation and court hearings. This route is often very costly, timely and can often be widely publicised in the local press if heard in an open court.

There are a number of Alternative Dispute Resolution (ADR) methods that are increasing in popularity and overcome some of the inherit limitations associated with litigation. The two most common types are arbitration and mediation. In this article I focus on mediation as a method to resolve dispute given its increased popularity.

Mediation involves an independent third party, the mediator, who chairs joint and private discussions with all parties and assists parties in negotiating a settlement that is agreeable by all involved. It can be commenced at any time during a dispute however is particularly beneficial, from a cost perspective, if commenced before the initiation of discovery.

In 2016, £10.5 billion worth of commercial claims were mediated and it is estimated, through this process, businesses will save £2.8 billion in time and costs according to the Centre for Effective Dispute Resolution.

One of the main benefits arising from mediation is confidentiality, with only those involved in the mediation knowing the details of what was discussed and agreed. This is particularly beneficial when dealing with personnel disputes or commercially sensitive matters, maintaining the reputation and intellectual property of the company. In mediation parties can also agree a wider set of solutions that cannot be discussed in the courtroom as such allowing for more flexibility.

Costs in terms of outlay and time, are also significantly lower when proceeding with mediation rather than ligation.

It is also possible to maintain or re-establish a positive relationship between parties once matters have been resolved via mediation due to the final agreement being accepted by both parties.

As with any dispute resolution method there are also disadvantages associated with mediation, such as, reliance on both parties being in a similar mind-set and not already entrenched. It is possible that the mediator, although a trained professional, may not be an expert in the field in which matters are being discussed, and in mediation the parties do not have access to legal aid.

Adopting the right method to resolve a dispute specifically suited to the situation is key to achieving the best outcome. It is also important that regardless of what method is chosen, that you have the right advisors in your corner to help reach a resolution that is ultimately in your best interests.