Mediation can be a brilliant way to settle a commercial dispute. But they need to be handled carefully in order to maximise the chances of success. Our team can help you do this, removing both stress and cost of more formal litigation. Call us today for help.
The importance of resolving disputes early on
Left unresolved, business disagreements can quickly become expensive, time consuming and stressful.
If we can avoid formal court proceedings, we will. We do this by careful use of the various forms of alternate methods of dispute resolution, including mediation.
Mediation is often the “go to” form of negotiation and has developed following the changes to working practices arising during the COVID19 pandemic. Our team at FWJ have been involved in numerous mediations held remotely over this period, most of which have resulted in successful and favourable outcomes for our clients.
- a mediation is a process where the parties meet to explore the strengths and weaknesses of each other’s case and the existence of a single forum on a single day (although it can extend for longer periods) often leads to a result.
- the parties are often more willing to engage because a mediation is more independent with advisors assisting in the drive towards a settlement which, whilst not the perfect outcome for either, is often a far better result than the alternative of long drawn-out commercial litigation claim.
Types of Mediation
Mediation can come in various forms and provide various levels of objective, for example, where the mediator (the independent “go-between”) may assist parties in
- reaching the settlement;
- may provide commentary on whether their points are strong or weak (where the mediator is an experienced legal practitioner); or
- may be more assertive and direct parties to the solution they should drive towards.
In respect of how the mediation proceeds, various innovative and less expensive processes have developed in addition to a more traditional (and more commonly used) mediation process. These include:
This is a process where sealed offers to settle are provided to the mediator who will confirm or deny that the offers have met, overlapped or there is still a significant gap. At Francis Wilks & Jones we have a great deal of experience of this type of mediation process, which is advantageous to both defendants and claimants for various reasons, the most important one being the lower cost.
2. Automated conversation
This is similar to blind bidding but has less flexibility (as a physical mediator is not involved) and is (as can be the case with blind bidding) focused solely on monetary claims where the algorithms dictate how the offers are managed.
3. Online Dispute Resolution (“ODR”)
This is a mediation process entered into via various types of software and can be either automated or include a mediator. How each process works is dependent on the ODR platform used.
The above aside, far the most common form of mediation is the traditional mediation where the parties set out their positions and a negotiation occurs leading to settlement. This can alternatively be also carried out online.
The mediation process
Mediation requires a neutral and trained mediator spending time, usually a day, with the parties involved in a dispute, shuttling between them to try to facilitate a settlement.
- the whole process is confidential and the trained mediator does not act as a Judge nor does he make any decisions.
- the mediator will not always express any views or thoughts about the case to the parties but use their experience to help the parties take the blinkers off and consider the overall situation they face (perhaps making suggestions or challenging beliefs as to the outcome of a claim or defence).
- the mediation process requires that the parties sign a mediation agreement with the mediator which will define the issues to be settled, be clear as to who will attend the mediation and importantly ensure that there is no doubt that discussion and negotiation is covered by without prejudice privilege (preventing it from being disclosed in proceedings, if the mediation fails).
Mediation can be expensive (but not always), with a lot of preparatory work required, including the parties’ position statements, bundles of relevant documents and instructions to the mediator. The mediator’s fees will usually be shared between the parties as well as the cost of the venue (unless it is an online mediation) and the fees of the respective professional advisors.
Mediation days can be long but the flexibility they offer allows parties who might be close to settling to reach a settlement (in our experience a lot more settlements arise through mediation than fail). Where a mediation is successful, and a settlement is reached, the terms of that agreement will be recorded in writing and usually finalised and signed at the end of the mediation day or very shortly thereafter.
Small claims mediation
If you are pursuing someone for a debt of less than £10,000 (as of writing), or are being pursued, then you may issue a commercial litigation claim in the small Claims Court. At Francis Wilks & Jones we have a dedicated team that deal with such commercial litigation claims.
In the Small Claims Court there is an option to mediate, which is free to parties to a dispute.
- this can be a remarkably effective way of bringing a dispute quickly to an end.
- whilst small claims proceedings do not have any costs consequences (for your opponent), all parties still have to pay their own legal fees and so moving quickly to mediation may well limit the costs you would otherwise be exposed to as part of your claim or defence.
The timing of a mediation can be an important factor in terms of the mediation having the best chance of success – success being to settle the case once and for all.
- the parties to any dispute are expected by the Court (if it goes that far) to think about trying to settle their case at all stages both before and during litigation.
- the court rules themselves require that parties consider ADR, of which mediation is one, and parties who refuse to mediate may find they are punished in the Court proceedings for not doing so.
Mediation can be entered into before or during legal proceedings. Like offers to settle, there is no point when you cannot consider such an option.
Mediation has many advantages in terms of reducing the legal costs, dealing with disputes quickly and retaining control of the process. However, it does require the engagement of the parties (as with most ADR processes) and so is not always appropriate.
At Francis Wilks & Jones we find that mediation is a remarkably successful tool in dealing with a lot of disputes and we have comprehensive experience of assisting clients in both commercial litigation claims and any associated mediation between you and other parties to a dispute.
I was greatly impressed with the commercial, tactical and technical ability of the team at FWJ. They quickly got to grips with a complex set of facts and, through their hard work, had the proceedings against me dropped and a significant proportion of my legal fees repaid. I couldn’t recommend them highly enough.A client the firm defended in legal proceedings