Nurturing Business Relationships in the COVID-19 Era
April 7, 2020
International Commercial Mediation
April 14, 2020

Mediation, a Superior Dispute Resolution Mechanism

Mediation is defined as an intervention between conflicting parties to promote reconciliation, settlement or compromise. It is a means of resolving disputes outside of the judicial system by voluntary participation. (Merriam-Webster Dictionary)

Mediation involves a neutral third person who attempts to facilitate settlement negotiations between the disputing parties. A mediator has no power to impose a settlement. A facilitative mediator expresses no opinion on the merits of either party’s case or its settlement value, however, an evaluative mediator does.  There is no risk involved; if the matter does not settle, the parties can decide whether to proceed with arbitration or some other adjudicatory method.

Mediation has numerous benefits over litigation. Some of these benefits are:

Flexibility: Mediation is a consensual process and can be structured in whatever manner the parties agree upon. The parties are able to select the mediator that will hear their case.

Time: Mediation encourages settlement at a much earlier stage. Mediation can be utilized at any time, prior to a lawsuit being filed, during the pendency of a lawsuit and even during the trial.

Cost: The parties usually pay an hourly or per diem charge for the mediator’s time. But this is a small fraction of the cost of litigation. The mediator’s fee is split between the parties.

Confidentiality:  What is said in mediation will not be used in later proceedings should the mediation prove unsuccessful. This allows parties to more freely engage in the process of settlement without concern that what is revealed in mediation may later be used against them.

Adverse publicity: Mediation can prevent the dispute from becoming a matter of public knowledge, which is often a major concern of one or both sides and which could generate similar claims by others. Litigation, on the other hand, is a matter of public record.

Narrowing dispute: Mediation tends to force the attorneys and parties to analyze their positions more carefully and thus possibly narrow their dispute, focusing on the essential issues which must be decided.

Lawsuits, on the other hand, involve legal issues and can be resolved only by predefined legal remedies: e.g., money damages, or an injunction, rescission, restitution, etc. The parties are forced to define their positions in light of legal doctrines, causes of action and defenses.

In contrast, mediation allows the parties to look beyond the legal issues and determine their underlying interests in the dispute. From this perspective, they may devise solutions that advance each of their respective interests. The possibility that mediation can result in a “win-win” solution for both parties is one of its most attractive aspects.