This is an extract of our Mediation document, which we sell as part of our Alternative Dispute Resolution Notes collection written by the top tier of City Law School students.
The following is a more accessble plain text extract of the PDF sample above, taken from our Alternative Dispute Resolution Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:
Egs of Mediation/ADR Providers
-CEDR (Centre for Effective Dispute Resolution)
-Conflict Resolution Centre
-Civil Mediation Council (brings together providers, mediators academics, legal professional bodies)
(1) What is Mediation
-A confidential, structured process;
-Involves a neutral/independent third party;
-Facilitates the parties working towards a negotiated settlement (a form of neutrally assisted negotiation).
-Voluntary process, non-binding (until the point of settlement).
-There is no determination of liability in mediation; any settlement reached is not necessarily based on underlying legal rights/obligations of parties.
(2) Why do parties mediate/How do parties find themselves in mediation????From a contractual obligation (a dispute resolution clause in the contract, that first attempt to resolve any dispute shall be by mediation);
Court ordered stay (may require the parties to undertake ADR including mediation)
Court may have encouraged parties to attempt to settle by mediation, and the parties may fear adverse cost orders/other sanctions if they unreasonable refuse to mediate.
Parties have Voluntarily chosen to mediate
Parties are referred to mediation by a disputes resolution scheme.
eg seek clarification of issues; assess strengths/weakness of other side's case). Such intentions are not improper if coupled with a genuine intention to explore settlement.
o Eg fishing expedition, is probably bad faith, no genuine intention to settle.
Practical considerations, eg:
o Desire to settle a multiplicity of claims re a number of different but related issues (in court, each claim may proceed in different courts/jurisdictions);
o Where a multitude of parties, eg a number a number of Ds and additional parties; all parties & claims can be brought into the mediation process.
(3) What preparation to lawyers do before mediation?
-Review and sign mediation agreement
-Check parties' authority to settle
-Prepare a position statement
-Manage/explain mediation process to client
-Decide who should attend mediation ??????
Decide what docs need to be prepared and exchange, prepare bundle (preferably joint)
Decide if and what expert evidence should be sought on any issue
Choose a mediator
Prepare any docs/evidence
Prepare statement of costs to date and going forward (costs that would accrue if went to trial)
Identify legal & factual issues;
Evaluate the evidence, reach conclusion on likely outcome.
Consider with client BATNA and WATNA (will include consideration of costs)
Plan a strategy for negotiation.
Identify objectives for mediation.
Do a costs analysis.
What preparation does the mediator do?
-Reads the papers sent to her, including any confidential briefing
-Contacts each of the parties/lawyers (pre-mediation meeting/phone call), to ensure they understand the mediation procedure; ask if they need to know anything further.
-Check who is attending, including people with authority to settle
-Discuss the likely duration
-Sometimes ask the lawyers to discuss with their respective clients possible terms of settlement and consider drafting them in advance
-Find out what experience of mediation the lawyers and parties have.
-Set timetable for pre-mediation events, eg when mediation agreement should be signed & returned; date for providing and exchanging position statements and docs).
The Mediation agreement, what should it contain
-The Mediation agreement = the contract between the mediator and the parties appointing him.
o Sets out terms on which the mediator is appointed and the scope of the mediation.
o It regulates the relationship between the parties themselves and between the parties and mediator.
o By signing the mediation agreement, the parties demonstrate a degree of commitment to the mediation.
-Courts have recognized that: mediation agreements are valid and they contain enforceable terms.
-Courts have granted an injunction to restrain breach of a confidentiality clause in such agreement.
-Most agreements will contain the following key clauses :
o That the parties are attempting to settle dispute at mediation
Role of mediator
Terms on which mediator is appointed
Scope of mediation (if it is only to deal with certain aspects of the dispute) ? which issues in dispute are to be mediated.
-names of parties and mediator;
-date and time and place of mediation;
-that the reps of the parties attending the mediation have authority to settle).
o Express clause that Process is confidential: that neither party can reveal any details of the mediation process or any info obtained during the mediation, without express consent of all parties.
o Express clause re 'without prejudice' rule protection for comms between the parties and/or the mediator.
o Preparation and exchange of documents for the mediation
The procedure that will be followed at the mediation
The mediator is neutral and impartial.
o An immunity clause for the protection of the mediator.
o That the parties will not bring a claim against the mediator (at all, or only in very limited circumstances).
o That the Parties will not call the mediator (or his employees/agents) as a witness or expert in later legal proceedings in connection with the dispute or in relation to any matter arising out of the mediation.
o Mediation will be conducted under mediation standard rules and/or
Code of Conduct.
o Any settlement reached will not be binding until recorded in writing and signed by the parties (/other steps required if a settlement is reached).
o Set out the costs & expense of mediation and who is responsible.
-Often provides that fees & expenses should be borne jointly and that each party is responsible for their own legal costs. & that each Party agrees that any court/tribunal may treat the Mediation fees and parties' legal costs as costs in the case in relation to any litigation/arbitration, where that court/tribunal has power to assess or make orders as to costs.
o An express term that each party will ensure the mediation is attended by someone with authority to settle.
o Which law the agreement is governed by: eg England and Wales. And courts of Eng & Wales have exclusive jurisdiction to decide any matters arising out of or in connection with this Agreement and the Mediation.
o That the referral of dispute to mediation does not affect any rights under Article 6 ECHR ? if mediation does not result in settlement, the parties' right to a fair trial remains unaffected.
(4) What goes in a position statement?
-Confidentiality (that the info is confidential & without prejudice)
-Formalities: Date & Time & Location
-Issues - Legal and factual ???Position on issues (the party's case on the issues)
Further info required
Summary of ADR/negotiation history (eg if an offer, including any Part 36 offer, has already been made).
Documents which should accompany the position statement:
Precedent H Schedule of Costs - if a schedule of costs has been prepared for litigation.
Key supporting docs
Each party will prepare a bundle of key docs for the M, to support the assertions & arguments made in the position statement.
o Docs purpose are to: inform M of the issues in dispute; of the strengths of each party's case; enable M to test the other side's case.
o Where possible, parties should cooperate and produce an agreed bundle,
-Statements of case if proceedings have been issued, and detailed letters of claim if proceedings not issued.
-Witness statements that have been disclosed by the parties
-Any expert reports
-Any case management orders
-Part 36 offers or other offers made but not accepted
-Any key docs that relate to the issues in dispute. Eg docs re quantum
-Any other relevant correspondence
-Parties can also produce a small bundle of additional docs for the mediator which they do not wish the other side to see. Eg setting out party's view of the case, issues they are willing to compromise on,
counsel's opinion on liability/quantum etc.
o Parties are not obliged to disclose anything; but bear in mind CPR and PreAction Protocols encourage a 'cards on the table' approach to litigation.
Possible attendees of mediation
-Reps of the parties (if individuals, themselves; if companies/bodies, a representative, someone with direct personal knowledge of the issues)
-Person with authority to settle (if a body/organisation/company)
-Witnesses of fact (rare)
(5) How is settlement recorded & enforced?
-Same as with negotiation, remember you first need to ask 'have proceedings been issued?' ??
If proceedings started, settlement recorded by:
o (1) settlement agreement
& (2) consent order (Tomlin Order?)
If proceedings not started: just (1) settlement agreement.
o Breach of contract (re the settlement order)
o Contempt (re the consent order)
What can be done to make a reluctant party engage in mediation?
-If one party wants to try mediation, and the other does not, steps can be taken:
-(1) a letter should be written to other side:
o pointing out that pre-action protocols/PD and CPR all require parties to consider using ADR to resolve dispute before issue of claim, and at the allocation and case management stages of the case.
o Letter should put the reluctant party on notice that if they unreasonably refuse to engage in mediation/another ADR process ? an order for costs
(including indemnity cots) will be sought at trial.
-(2) a party can suggest that the parties seek help from an ADR provider/broker to give neutral and independent advice on the benefits of mediation, whether it would be appropriate (given the facts & circumstances), and how the process can be tailored. The broker will liaise with the reluctant party and seek to persuade it.
-(3) (where proceedings have been issued) a party may invite the court to stay proceedings and direct the parties to attempt ADR. Court can also assist mediation by making appropriate orders for advance disclosure of info/docs.
-(4) if the reluctant party is worried about mediation delaying the trial or litigation process: the other party can point out that if mediation results in settlement,
significant saving in time (and costs) will be made. Even if litigation has commenced, mediation need not lengthen the litigation process (it can be attempted without a stay being granted, and even if a stay is granted will be a short period, usually 28 days). Even if mediation doesn't result in settlement, it can help narrow the issues and prepare effectively for trial.
-(5) if a party fears revealing their case --> point out that the CPR favours a 'cards on the table' approach to litigation, so this is not a valid reason for refusing mediation.
Anything relevant to litigation will have to be disclosed in any event during disclosure process. And the parties themselves control the amount of info they give to the mediator and which is disclosed to other side.
-(6) a party may fear that info disclosed in mediation will be used against them in subsequent litigation: however, mediation is a confidential, without prejudice process, and that is only overridden in exceptional circumstances.
-(7) If both parties consent, judicial mediation can be undertaken: at present, this tends to be confined to cases in Technology & Construction Court, some family cases, and under Judicial Mediation Scheme in the Employment Tribunal.
Timing of Mediation
-Before embarking on mediation, parties should first attempt to settle by direct negotiation (will be less expensive and narrow issues) ??
Mediation can take place at any stage of a dispute: before issue; after issue; any time up to trial; even pending an appeal.
Mediation before issue of claim:
o Factors re whether to attempt mediation before issue:
o Are the issues fully defined? Is the clients case clear? Has al key info been obtained? Have the main witnesses been interviewed and statements taken?
Is the other party's case clearly developed? Have key docs material to the dispute been exchanged? Necessary to obtain expert report? Is it advantageous to client to attempt early resolution before issuing proceedings?
o Advantages of mediation before issue: largest saving in costs & time;
greater incentive to settle to avoid stress/costs/time of litigation;
relationships more likely to be preserved; total confidentiality more likely to be achieved.
o Disadvantages of mediation before issue: the issues may not be clearly defined; parties may not have reached an accurate assessment of their own case; there may not be full disclosure of all relevant docs & info; may not be possible to evaluate strengths/weaknesses of each party's case with accuracy; may not be possible to fully quantify claim/counterclaim.
o Will be advantageous to embark on mediation before proceedings are issued where: the parties have fully defined the issues; disclosed key information; quantified the claim and any counterclaim.
o If the issues are not yet clearly defined; further info/docs are needed to evaluate strengths/weaknesses ? then parties should endeavor to provide this info in advance of the mediation.
o May be unreasonable to refuse to mediate just because further info/evidence was needed first: if no attempts were made with other party to obtain what is needed.
Mediation after litigation begins
Advantage: issues will be more clearly defined; especially if after disclosure and exchange of witness statements/expert reports.
o Disadvantage: cost savings will reduce the closer mediation is taken to date of trial.
o Parties can apply for a stay of proceedings to suspend the court-set timetable, to save costs.
o Largest number of successful mediations take place in the early stages of litigation (during exchange of SoCs or after disclosure).
Why it is effective ADR process?
As with negotiation: cost effectiveness; keeping control of outcome and of the process.
Presence of mediator can assist the negotiation process, by:
o Adding a new dynamic to the bilateral relationship in negotiations between the parties/their lawyers;
o As a neutral 3rd party, the M can help parties present their case more effectively; ?
o M can balance different negotiating styles/personalities;
o M can help parties work through deadlock
Proposals made through a M can be perceived as being more attractive than an offer made by the party directly (REACTIVE DEVALUATION ? arguments put forward by one side directly are automatically psychologically devalued by the other side); and a concession through M may seem more valuable;
o Appointment of M introduces an element of detachment into the process;
o M can calm/diffuse strong feelings;
o M brings own personal attributes/skills to the table;
o Help parties communicate constructively & effectively;
o Encourage more accurate & honest assessment by each party of the strengths/weaknesses of its case;
o Avoid over-ready concessions;
o M skilled at getting to grips with needs & interests of the positions of the parties.
Other reasons why mediation is effective:
o Takes place in a structured process, within a defined time frame.
o The parties are likely to be paying for the mediation, have invested time and money in the process ? generates an impetus to settle.
o The court may direct (though can't compel) parties to attempt mediation, so more likely to engage seriously with intention of settling.
o Mediation puts control into the hands of the parties themselves, empowers them to resolve the dispute.
o Can explore options for settlement that could not be ordered by court;
more creative settlements reflecting underlying needs/concerns/interests.
Advantages of mediation (also shares the general advantages of ADR)
a) The presence of an independent, impartial and fair third party M will help facilitate attempts at settlement;
-diffuse tension and hostility;
-make focus on parties' interests and needs rather than positions.
b) Can deal with things not directly in issue c) Flexible process, can be tailored to meet needs of the case.
d) Less procedurally burdensome, of benefit eg if the case potentially involves multiple claims and jurisdiction issues which would be procedurally complex in litigation.
e) Results in quicker resolution of the dispute than litigation f) Is cost effective. Tends to be cheaper than trial (and potentially more cost effective than further negotiation if it has resulted/will result in deadlock).
g) Time effective process: Can be arranged relatively quickly, normally can be arranged within a matter of days/weeks from date of decision to mediate.
The mediation will typically last for one day only.
-Mediation in a structured setting, set time frame.
h) Negotiations can take place with the assistance of a neutral 3rd party, within a structured process.
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