Mediation Guide

What is Mediation?

Mediation is a type of facilitated negotiation in which parties appoint a skilled, unbiased third party (the mediator) to assist them in resolving their conflict. The mediator, appointed by the parties, is a neutral facilitator who helps the parties reach an agreeable settlement that addresses everyone’s concerns. Importantly, the mediator does not enforce decisions; instead, the parties make key decisions.

To mediate means to act as a peacemaker between conflicting parties. It is an informal process in which one or more impartial third parties help the parties achieve a resolution. Mediators do not judge or arbitrate disputes; rather, they counsel and discuss with parties impartially to help them reach a mutually acceptable solution.

Some definitions include:

• “Mediation is a form of negotiation facilitated by a third party. Unlike an arbitrator or judge, the mediator lacks the authority to impose a resolution on the disputing parties.”
• “Mediation is a facilitative process where disputing parties enlist the help of a neutral third party, acting as a mediator, to assist in resolving their dispute.”
• “When two or more individuals or entities are unable to resolve a particular problem, they engage a neutral mediator to guide them towards a solution. The mediator works closely with each side, fostering understanding of their positions and exploring alternative solutions.”
• “Mediation involves one or more individuals aiding parties in reaching a settlement through direct negotiations. The mediator remains impartial, providing advice and consultation to all parties involved.”

There are two key aspects to mediation. Firstly, it involves the intervention of a third party whose primary role is to facilitate the decision-making process of others. This process builds upon negotiation, and the mediator plays a fundamental role in sustaining and reviewing the situation with the parties. Secondly, the third party should be independent of the disputing parties, ensuring impartiality. The trust developed during mediation allows the mediator to act as a bridge between the parties.

Mediation is a voluntary process. The mediator acts as a facilitator and does not judge or provide advice during the process. The mediator employs solution-focused techniques to assist parties in reaching a settlement that satisfies all parties, ensuring a desirable outcome overall. Each party has an opportunity to express their viewpoint and listen to the other party.

Negotiations in mediation are confidential and conducted on a no-prejudice basis, meaning parties cannot rely on statements made during mediation outside of the mediation. If a settlement is reached during mediation, it can be enforced as a legally binding contract.

Mediation styles often fall into two categories: “facilitative” and “evaluative.”. In facilitative mediation, the mediator aims to re-establish communication between the parties and explore settlement options without expressing personal opinions on the issues. In evaluative mediation, however, the mediator may provide opinions on specific issues when requested, thus evaluating those issues openly.

In summary, the main elements are:

• Voluntary Participation: The parties engage in mediation voluntarily, participating of their own free will.
• Neutral Third Party: A neutral third party facilitates the parties towards reaching a settlement.
• Non-binding Process: Mediation is non-binding unless the parties reach a mutual agreement.
• Private and Confidential: The mediation process is conducted in private, maintaining confidentiality, and discussions are without prejudice to any legal proceedings.

These fundamental elements contribute to the effectiveness of mediation as a flexible, confidential, and collaborative method of resolving disputes outside of formal legal proceedings.

Benefits of Mediation

Many view mediation as offering a variety of advantages compared to traditional formal adjudicative processes like litigation and arbitration.

These benefits include:

• Faster Resolution: Mediation often resolves disputes more quickly.
• Cost Savings: Mediation can lead to lower costs for resolving disputes.
• Satisfactory Outcomes: Mediation aims to achieve more satisfactory outcomes for the parties involved.
• Prevention of Future Disputes: Mediation can help minimise the likelihood of future disputes.
• Improved Communication: Mediation opens up channels of communication between parties.
• Relationship Preservation: Mediation works towards preserving or enhancing relationships.
• Time and Money Savings: Mediation saves time and money compared to formal legal processes.
• Empowerment: Mediation empowers the parties involved in resolving their disputes.

Overall, mediation provides a more collaborative, efficient, and successful method of dispute resolution, emphasising mutually beneficial outcomes while protecting relationships and eliminating the time and financial constraints associated with formal court proceedings.

What is the mediation process?

Mediation typically involves three main phases:

1. Pre-mediation: This phase encompasses the initial steps leading up to the mediation session. It begins with agreeing to mediate, where parties voluntarily commit to engaging in the mediation process. Preparation for mediation involves gathering relevant information, identifying key issues, and selecting a mediator. During this phase, parties may also exchange documents or information to streamline discussions during the mediation session.
2. The Mediation Session: This is the core phase of the mediation process, where parties and the mediator convene to discuss the issues in dispute. The mediator facilitates open communication, encourages parties to express their perspectives, and explores potential settlement options. The mediation session can involve joint meetings with all parties present or separate caucuses, with the mediator meeting each party individually. The goal is to reach a mutually acceptable resolution that addresses the interests and concerns of all parties involved.
3. Post-mediation: This phase occurs after the mediation session concludes. If parties reach a settlement agreement during mediation, they formalise the agreement into a written document signed by all parties. This agreement is typically binding and enforceable. In cases where mediation does not result in a settlement, parties may consider alternative dispute resolution methods or proceed to formal litigation. The post-mediation phase also involves complying with any terms or actions agreed upon during mediation, such as payment arrangements or specific actions.

These phases illustrate the structured yet flexible nature of mediation, providing parties with an opportunity to actively participate in resolving their disputes in a collaborative and constructive manner.

Pre-Mediation:

Pre-mediation involves the preparation phase leading up to the mediation session. This phase typically begins with an initial inquiry where parties are introduced to the mediation process and encouraged to participate. Often, a contract to mediate is used to establish terms and ground rules for the mediation, covering aspects like costs, confidentiality, the without prejudice nature of discussions, settlement authority, and the timeline.

During this phase, parties typically exchange written summaries of the dispute and may provide supporting documents. The mediator is identified and becomes a party to the mediation contract.

From the mediator’s perspective, the goal of pre-mediation is to ensure all parties participate in the mediation session. However, the strategies adopted by the parties may vary. They might prepare their case, explore innovative settlement options, or calculate their Best Alternative to a Negotiated Agreement (BATNA).

The Mediation:

Most commercial mediations typically span a single day, though some may extend over several days, weeks, or even months. Mediations usually take place on neutral ground, avoiding the potential power imbalances that could arise if conducted at one party’s familiar office. The mediator’s role involves managing the process, including receiving and seating the parties, followed by necessary introductions. During the initial joint meeting, the mediator establishes ground rules and invites parties to make opening statements.

The mediation process is flexible. After opening statements, the mediator may discuss issues either in the joint meeting or in private caucuses. A caucus involves private meetings between the mediator and individual parties to explore issues and settlement options confidentially. Through caucuses, the mediator aims to:

• Build rapport between parties and the mediator
• Clarify main issues
• Identify parties’ interests and needs
• Provide an outlet for emotional expression
• Uncover hidden agendas
• Identify potential settlement options

While in caucus with one party, the other party may work on specific tasks assigned by the mediator. The mediator may also convene further joint meetings to narrow issues, facilitate expert discussions, or finalise settlements. The objective of mediation is to develop a commercially acceptable and workable agreement that can be formalised into a binding settlement contract.

Post Mediation

Post-mediation entails either executing the settlement agreement or proceeding towards a trial or arbitration hearing. The mediator may continue to be involved as a settlement supervisor or facilitate further mediations if needed.

Failure to reach a settlement does not indicate an unsuccessful mediation. Parties may gain a deeper understanding of their dispute, leading to future efficiencies in resolution or prompt settlement shortly after the mediation.

What is the mediator’s role?

The mediator plays a crucial role in managing the mediation process. According to the Centre for Effective Dispute Resolution (CEDR), the mediator should perform several important functions during mediation:

• Manage the process firmly but sensitively.
• Facilitate the parties towards settlement by overcoming deadlock.
• Gather information to identify common goals.
• Act as a reality tester, helping parties take a realistic view of the dispute.
• Act as a problem solver, thinking creatively to help parties construct an outcome that meets their needs.
• Address parties’ feelings and frustrations, redirecting their energy towards positive approaches to the issues.
• Assist in drafting the agreement.
• Supervise the settlement, ensuring the agreement is effective, and offer assistance with any further issues that may arise.
• Encourage parties towards settlement and maintain momentum.

Building trust and confidence with the parties is essential for fostering open and honest discussions that can lead to effective problem-solving and settlement options.

Mediators employ various strategies to facilitate settlement during mediation. According to the literature, there are five main activities that mediators should utilise:

1. Investigation: Mediators use questioning to gather information and identify gaps in each party’s perspective.
2. Empathy: While maintaining neutrality, mediators demonstrate empathy to build trust with the parties.
3. Persuasion: Mediators use persuasive techniques to drive the mediation process forward.
4. Invention: Mediators engage in creative problem-solving to generate potential solutions.
5. Distraction: Mediators employ distraction techniques to shift focus and explore settlement possibilities from different angles, helping to avoid the positional polarisation often seen in conflicts.

Effective mediation involves a thorough investigation into both the disputed issues and the underlying conflict dynamics. Mediators must understand the parties’ hidden objectives to guide them towards a successful resolution. While maintaining neutrality, mediators use empathy, persuasion, creativity, and distraction to facilitate productive discussions and explore innovative settlement options.

The Liability of Mediators

Most mediation agreements include a clause stating that the mediator shall not be liable to the parties for any act or omission in connection with the services provided. This clause aims to completely exclude liability and differs from the immunity granted to arbitrators. Arbitrators are typically immune under legislation, except in cases of demonstrated “bad faith.”.

It can be argued that a mediator, acting purely in a facilitative capacity, should not encounter circumstances that would lead to liability. Nevertheless, it is common practice to include an immunity clause in mediation agreements.

The Qualities of a Mediator

Much of the literature emphasises the function, role, and skills of mediators. A mediator’s qualification is not based solely on expertise in a specific area but rather on the ability to assist parties in reaching a settlement.

In this regard, a mediator must oversee the mediation process, gather information from the parties, evaluate and test that information, and facilitate the exchange of information that can lead to a settlement. These processes define the role or function of the mediator.

Why Choose Mediation?

Research indicates that mediation leads to settlements in the majority of cases, and even when mediation does not result in a settlement, it is not always perceived negatively.

Some advantages of mediation include:

• Allowing parties to express their feelings about a dispute and how they wish to resolve it;
• Enabling parties to consider solutions that a court may not be able to order;
• Facilitating agreement on practical solutions between the parties;
• Addressing underlying issues such as the desire for an apology or acknowledgment of wrongdoing;
• Preserving and fostering ongoing relationships between the parties;
• Maintaining confidentiality of settlement terms;
• Saving time and money compared to court proceedings, with greater flexibility in the process.

Mediation empowers parties to engage in open dialogue, explore creative solutions, and prioritise their unique needs and interests. This collaborative approach often results in mutually satisfactory outcomes that can preserve relationships and promote effective conflict resolution.