1. What is mediation?
Mediation is a voluntary process in which parties in dispute are helped by a specially trained, neutral third party (the Mediator) to find their own, mutually acceptable solution to their dispute. The process is confidential and non-binding until settlement is reached. On settlement, an agreement is signed by both/all parties and this becomes legally binding on them.
2. What will it cost?
Cost varies according to the amount at issue, the complexity of the matter and the time taken (full day or part day). However, the Mediator should always give you a fee quotation before accepting instructions and this should include all allowances for preparation time, travel and other expenses, so that you have a firm figure before you commit yourself. Remember also to allow for the costs you will incur if you decide to bring along advisors to the mediation: only bring those whom you expect to make a positive contribution to reaching a settlement.
3. How quickly can a mediation be set up?
A mediation can be set up in as little as a week, so long as mutually suitable dates can be found. In any event, it takes no more than a few weeks at most – noticeably quicker than litigation or arbitration hearings.
4. Is mediation legally binding?
The whole process is without prejudice (i.e. nothing said or done in the mediaiton can be used against you in court) and voluntary unless and until a settlement is reached. Once the parties have signed the settlement agreement [see below], they are then legally bound by it.
5. What if I don’t want to mediate?
Mediation is never compulsory. There are sometimes good reasons for not mediating a dispute and I, or a lawyer can advise you if they might apply to your case.
However, the courts encourage it and if you refuse an offer to mediate without good reason, you may find that costs are awarded against you (even if you win at court).
6. What are the chances of a mediation settling the dispute?
There are few published data on settlement rates, but anecdotal evidence supports the widely quoted view that around 80% of mediations settle on the day, with many of the remainder settling within the next couple of weeks.
7. What happens if we don’t settle?
You continue with litigation or arbitration as though the mediation had never taken place. Neither party can use in evidence anything said during the mediation. But if progress was made, you can continue to negotiate or you could set up another mediation to try to resolve the outstanding issues.
8. How should I prepare for a mediation?
Preparation is crucial if you are to have a good chance of settling at mediation. It takes two forms:
- factual preparation, by rehearsing (with your solicitor or advocate if you have one) the background to the case: how and why do you think the dispute started? How strong is your case and where are its weaknesses (if any)? What do you need to achieve a fair and workable result at mediation, and why? What are your realistic chances of winning in court if you can't settle at mediation?
- personal preparation, by thinking yourself into a problem solving frame of mind; you are coming to mediation in order to settle the dispute by negotiation, rather than asking a judge to settle it for you; so be ready to look at the other side's position as well as your own. Why have they been unable to settle up till now? What might their needs be? Can you offer anything at little or no cost to yourself that might help them to shift their position?
Always be thinking that the object of mediation is a negotiated settlement; this needs collaboration from both sides. If you're looking for outright victory, this is probably the wrong arena for you.
9. What is a 'Position Statement'?
A position statement is a bit like a case summary, but from your point of view. The mediator will be keen to hear your view of the dispute in your own words and from your perspective, so your position statement should be a reasonably brief summary of the dispute, how it got to where it is, and your feelings about the dispute itself and how you would like to see it resolved. Bear in mind this is a document that may be shown to the other side, so it should be expressed in reasonable language and focus on the facts as far as possible. However strongly you may feel about your opponent, an aggressive statement blaming the other side for everything won't get the day off to a positive start!
If there are things you need to say to the mediator but you do not want to put them in the position statement you can present a confidential statement to the mediator at the same time. This will not be shown to the other side in any circumstances.
Drafting a position statement takes some thought, so often parties let their solicitors do it; this is fine, but there's nothing quite so attention-catching as the words of the individual, so if you can do it yourself, so much the better.
10. Who should I bring with me to the mediation?
You can bring anyone you want, from your solicitor to your best friend; but remember that professional advisers will charge for their time so don't bring anyone who cannot make a positive contribution to the search for a settlement; you should question whether you need more than one or two such advisers and you may find you need only a friend or family member. It is, however, essential that you come with authority to settle, so if you have a partner, co-director or spouse who is involved in the dispute, bring them - or at the very least have them available at the end of a phone. If in doubt, talk it through with the mediator or your solicitor.
11. Isn't offering to mediate showing the other side you're not confident of winning?
Not at all. It shows that you want to settle on a fair and workable basis, which does not mean that you don't have a good case; but a solicitor will tell you that even the strongest cases cannot be guaranteed to win. By mediating, you eliminate litigation risk, bringing the dispute back within your control. Furthermore, if you offer to mediate and the other side refuses, you put yourself in a strong position in court when it comes to the award of costs. (see What if I don't want to mediate?)
12. What is a 'Settlement Agreement'?
A settlement Agreement is a written record of the terms agreed by the parties to a dispute to enable it to be resolved. It is legally binding on both (all) sides and will be enforced by the courts if one of the parties fails to do something s/he has agreed to do, or does something s/he has agreed not to do. This written agreement is an essential part of the process and you should not agree to leave at the end of a mediation without one, if terms for a settlement have been agreed. On the other hand, you should never feel pressurised to sign an agreement that you're not willing to live with. It's better to adjourn the mediation for another day and continue the negotiation afresh, rather than signing a settlement agreement under pressure.
13. What is an 'Agreement to Mediate'?
An Agreement to Mediate sets out the terms on which the mediation is to be conducted and is signed by all parties to the mediation. It covers practical details such as the mediator's charges, the venue and date; but more importantly it binds the parties to confidentiality so that nothing said or done during the mediation can be used by one party against the other in future and the terms of any settlement cannot be divulged to the press, third parties or even the courts - except in the event that a party fails to honour a term of the settlement and the Settlement Agreement itself has to be referred to the courts (see above). In summary, the Agreement to Mediate should give both parties the assurance that they can explore options for settlement without fear that concessions offered or things said will be used to their disadvantage later.