What is commercial mediation?

Commercial mediation is a process that parties to a dispute can undergo, which is a way of attempting to resolve the dispute, the place an independent third party is appointed to behave as a facilitator between them to help them negotiate a settlement dispute. That impartial third party isn’t a judge. They’re not going to make a choice on the proof or tell you who’s right and who’s improper and who wins and who loses. They will assist you to see either party’s position and help them come to a settlement.

The process of commercial mediation

It’s a totally voluntary process. You should not have to attend commercial mediation, and when you find yourself at a mediation, you may leave at any time. But it is a good opportunity to have a commercial dispute case settled without the necessity for the proceedings to either, if they’ve already started, continue and proceed at increased costs for both parties, or alternatively, have a mediation at an early stage before any litigation has started in an try to keep away from these costs starting or running away from the parties at a really early stage.

So, it’s a form of alternative dispute resolution, which is an umbrella time period for many strategies of making an attempt to resolve disputes without having to interact in court proceedings, and it is becoming more and more prevalent in companies’ minds once they’re having a dispute.

Rather than, “Let’s have a big argument and spending lots of prices and lots of time in dealing with the dispute”, “How can we get to the top of the dispute in a quicker way and a more price-effective way?” And commercial mediation is a large part of that and a superb way of reaching that end goal in a much more price- and time-environment friendly manner.

Do I have to attend commercial mediation?

Mediation is a voluntary process, but there can be adverse cost penalties in litigation if a court believes that a party has unreasonably refused to mediate.

So, if one party to a dispute makes a suggestion of mediation, it can be very prudent, unless there’s an especially good reason why the opposite party doesn’t wish to mediate, and people reasons may be that the other party’s case doesn’t have any merit or the worth of the case concerned can be such that the costs of mediation, even attending a mediation could be disproportionate to the worth of the dispute.

But, that aside, you would need to have a fairly good reason not to, to not mediate. Otherwise, a court might make an adverse costs order in opposition to a party who has unreasonably refused to mediate.

So, it is a case really that the court does expect the parties always and all phases of a dispute to attempt to achieve a settlement, not necessarily via mediation exclusively, however the court does expect the parties to try and reach a settlement. And mediation, as we now have already discussed, is a good way of doing that in a timely and value-effective manner.

Is the result of commercial mediation legally binding?

The outcome of mediation would be legally binding in very specific circumstances, and that’s once an agreement recording the position reached at mediation in a legally binding document.

So, it’s recorded in writing and signed by those parties to the dispute. Until that has occurred, the end result of a mediation will not be legally binding, and it could be open to either party to the mediation to renege on the agreement or not enter into the agreement or seek to try and change the agreement for each in the course of the course of the mediation, up until the purpose that it is being recorded in writing and signed by the parties. And due to this fact, we advise clients who’re at mediation and have gone via the process of reaching a settlement at mediation to try their utmost to get that agreement signed on the day of the mediation. And sometimes, the recording of the agreement can take just as lengthy, if not longer, as to really the parties reaching the agreement at mediation themselves.

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