People are disappointed with the existing system of litigation and arbitration. They have been seeking alternative methods for resolving their disputes. They have discovered that mediation is just what they want as mediation is so much quicker and simpler and so much less expensive than litigation and arbitration, and the mediation process can result in much better outcomes for all involved. Mediation is undoubtedly the leading alternative method of dispute resolution when it comes to all kinds of commercial, family and personal disputes. Its usage has dramatically increased over the past 20 years.
A successful outcome of mediation is much more constructive for the parties than a court judgment and an arbitral award. The solution is not simply ‘black and white’, and there is no clear winner and loser because there is no time to investigate who is legally ‘wrong’ or ‘right’. The time necessary to get to the point of a full analytical resolution of complex commercial disputes by legalistic procedure is not worth the money. A successful mediation also means that usually both sides instead of only one or neither, come out of the process with a measure of satisfaction (win-win).
Thereby, more and more people are using mediation to settle their disputes. Concurrently, about 80 countries and international organisations have made mediation laws and established mediation service institutions to promote and support the use of mediation to resolve disputes, with a view to satisfying the requirement of the people on the one hand and to dissolve the negative effects which have been brought about by the declining systems of litigation and arbitration on the other hand.
Recently Singapore was poised to become the first jurisdiction in Asia to introduce legislation permitting the use of third party funding in support of international arbitrations and related proceedings.
One of the main advantages of mediation is that it is a non-binding process and the parties are free to try various compromise solutions. It is only when the parties have reached an agreement and reduced that agreement to a written and signed document that the agreement becomes binding. Mediation is a legally privileged and confidential process, which further encourages the parties to try to reach a compromise, safe in the knowledge that anything said or done within the mediation cannot be used in subsequent proceedings, should the mediation not resolve or only partly resolve the dispute.
What is missing from preparation for mediation for some lawyers is the preparation. This is the necessary discussion about the purpose and goals of the lawsuit, or perceptions of a party about the motivations, goals, and concerns of the other. Often there isn’t an exploration of what a good solution to the dispute might be, nor is there an assessment of the value of the case (including consideration of potential for success), against the opportunity, financial and emotional costs of pursuing it.
Is there another way?
Mediators help parties break free of the zero-sum game (Or competitive game for more of the pie). Those who do usually develop a very different view of the opportunities. In particular, they:
* See possibilities for discussing a number of potential resolution options very differently from the litigation goals of damages or rescission or capitulation.
* Seek a clear understanding of why the other party responded so negatively to initial attempts to discuss the matter, and see opportunity to rebuild the future if they could discuss differences effectively.
* Understand more clearly their motivations and the values that led them to feel so strongly about the situation.
* Understand that there could be a significant difference between the differing values and views.
* Understand their perspective may have lacked information, or may have lacked awareness of the other party’s perspective.
* Understand what they are prepared to invest in the litigation.
Mediation will not resolve every dispute of course, but, at the very least the issues will be narrowed and given the high chances of a settlement, there are few disadvantages in attempting to resolve a dispute by mediation. Mediation increasingly forms part of a multi-tiered dispute-resolution process and is often employed before resorting to arbitration. Importantly, mediation allows the parties to retain control of the outcome of the dispute, enables them to fashion their own commercial business solutions and is ideally suited for maintaining relationships. And this is why so many countries are adopting it as an alternate solution to the resolution process.