Assessing the suitability of Mediation Workshop

18th June 2014

ICMA Work Shop – Assessing the suitability of Mediation

Ground Rules: As client or adviser where a dispute emerges, the key to a successful should not be to define the outcome in straight lines. Disputes are rarely resolved with a “Black or White”  answer; there are nearly always shades “of grey” which get lost in the detail and the heat of battle. Commerce involves negotiation and give and take. So why is mediation suitable and when should it be considered?

Commentators argue that mediation should be considered from the outset of every dispute. It is not a case of mediate now or forget mediation – the process and the advisors who champion it allows for fluidity.

If you ask parties what they want from a dispute, most disputants will say they want a quick solution, which is inexpensive and which results in them getting what they bargained and paid. Life is not always that simple. Mediation offers an alternative – a “win win” if you like. I particularly like the analogy of two parties who are arguing over an Orange. They both recognise that cutting the Orange in half is a disaster and have lost all objectivity and believe that the only solution is to secure the full Orange. The reality of the situation is quite different: one party needs the juice and the other needs the rind/skin. With mediation and a preparedness to think outside the box, the commercial imperatives can be achieved. Both can be winners, preserving continuing relationships and settling the current dispute with a minimum of disruption.

When selecting mediation parties are making a choice to find an innovative solution to a dispute, with a structure but an added a dynamic of flexibility which never exists in a court or arbitral process. The process remains party driven (not lawyer or adviser driver), it is completely voluntary and can be terminated at any time by the parties and most significantly in a commercial context it is completely confidential to the outside world and without prejudice to any existing legal proceedings. In plain language none of the parties can use anything said against the other party after the mediation.

Issues for consideration: It is possible to break the components to assess in a dispute into 3 distinct areas, namely:

 

Parties Goals:

Establish the parties’ goals for managing the dispute, in doing so they should look to:

The importance of maintaining an on-going relationship during and post the dispute;

Maintaining control over the outcome of the dispute; and

Maintaining control over the process itself;

 

Examine the legal goals:

What is the likelihood of a quick process disposing of the dispute;

Is a legal relief (injunction, court order etc required);

Can the dispute be resolved without discovery; and

Is a neutral evaluation on the level of damages required;

What are the pragmatic goals:

How much will it cost to fight the case at trial/arbitration;

Is it important to have the dispute resolved quickly;

Is privacy a factor; and

Is the court/arbitral process likely to result in a financial bonanza.

 

Practical issues:

What is the parties’ capacity for problem solving:

Are fundamental principals at stake;

Is public vindication required;

Is there certainty from a court or arbitral process;

Do the principals see benefits in mediation;

 

What is the quality of the parties’ relationship:

Is there an emotional climate to settlement;

Is one party substantially superior in terms of financial clout;

Do the opposing counsel have compatible personae to induce settlement;

 

Practical realities:

 

Are there possibilities for worthwhile negotiated trade-offs between the parties;

Does the dispute involved critical areas of managerial responsibility; and

Is the jurisdiction receptive for which mediation is being considered.

 

Generic issues: 

Would mediation benefit the partieas by:

 

Clarifying issues;

Channelling negative emotions;

Offering an opportunity to “tell the story” and ”to be heard”;

Would an apology assist;

Offering a reality check with the involvement of a neutral 3rd party facilitator;

Providing a confidential setting;

Offering an opportunity for trade-offs and creative solution making;

Educating the decision makers;

Allowing an intermediary to facilitate the making of neutral offers and counteroffers; and

Reframing of proposals by a neutral 3rd party.

Avoid Anarchy:

Unlike a Court or arbitral process mediation may be perceived (wrongly in my opinion) as very loose and unstructured. Whilst the process is fluid, a strong mediator will keep structure and ensure a smooth sailing through choppy seas. It is vital that the parties understand in selecting mediation that they are agreeing to a process which will ebb and flow, in which they will make real and personal contributions and in which extraneous issues (which would not be under consideration in a court case) can be voiced and discussed. However, the real skill in mediation is to ensure that the mediator controls the process sufficiently to prevent anarchy creeping into the process – this can only be done where the mediator remains strong and in control of the process.

 

By Dermot McEvoy

Partner Eversheds

One Earlsfort Centre,

Earlsfort Terrace

Dublin 2

Tel: + 353 1 6644238

Mob + 353 86 2242989

Email: Dermotmcevoy@eversheds.ie

 

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