April 25, 2020
Paul Newman is a lawyer and an accredited mediator. He has written a number of books on the subjects like ADR and mediation and these books are quite popular in the market too. According to his ideology, a mediator has to exhibit certain qualities only to become effective in the way. Empathy is the first of these qualities. A mediator has to understand the points of both the parties involved, and his or her opinion on the subject generally does not feature or count in the issue. The points of the parties involved are the most important and he will have to prioritize that. He will have to be patient enough to allow both the parties involved in the process to progress on their own. Self-assurance plays a very important role in the aspect too. The mediator has to have certain amount of self confidence and he or she has to have the ability to take charge of the mediating process and ultimately lead the process. Some times the ingenuity of the mediator plays a vital role. It allows the mediator to introduce new ideas and even promote discussions if the things that are being discussed are kept on a stand still. Finally in is not known that how long a settlement might take. It can be over in a short period of time or can take a number of sessions to reach a final settlement. So along with patience the mediator has to have stamina to endure long settlement discussions.
These abovementioned characteristics are general qualities of a good mediator but frankly speaking there are not set standard of a mediator in the United Kingdom. Most of the mediators in the UK come from judges, solicitors or barristers, and they do not have any formal training in the line of work. But there are many countries that have several very important rules for the mediators. Here one can take the example of Austria. Under the s29 of the Austrian Mediation Act all the mediators in Austria must have several skills and a minimum of two hundred hours of training. Ontario, the Canadian province has passed legislation and it made mediation as one of the mandatory obligation in the civil litigation processes. In contrast to these laws, the United Kingdom has less formal rules on the aspect of mediation, but in no way it lessens the effectiveness of a mediator in reaching a settlement between two feuding parties. It has become a very popular form of alternative dispute resolution and it helps to reach settlement in a successful way. The main objective of mediation is to reach a final settlement. And by the process it some times offer easier paths than processes like lawsuits, and attain better results. Prominent English judges have spoken on the issue of achieving settlement in any stage of civil dispute.
In the case Naylor v Preston Area Health Authority there was an interesting statement. Lord Donaldson noted that
“…the procedure of the court must be, and is, intended to achieve the resolution of disputes by a variety of methods, of which a resolution by judgment is but one, and probably the least desirable. Accordingly, anything which enables the parties to appreciate the true strength and weakness of their positions at the earliest possible moment and at the same time enables them to enter into fully informed and realistic discussions designed to achieve a consensual resolution of the dispute is very much in the public interest.”
In recent times there is a trend of using mediation instead of litigation, as it has several advantages. This is why English Procedural Law encourages the process. As per Neil Andrews, there are five core reasons which make a party interested in mediation rather than litigation.
- The parties can select the mediator in the process where in legal proceedings they are unable to choose the judge.
- Mediation is confidential where any type of court proceeding is public, and can be witnessed and recorded by any one.
- Court remedies are generally restrictive, while the process of mediation can offer a broader scope of flexible policies.
- In most of the cases, meditation allows the parties to reach in a friendly outcome.
- The last and the most important aspect of mediation is that it both saves time and money.
With the mediation process some objectives can be attained which is virtually impossible through the court proceedings or any type of formal litigation. But still it has got some limitations too. The recent wave of ADR and the emergence of mediation have been criticized by some purists and conservative scholars. Owen M. Fiss has said that in the most cases the mediators are not public servants and so the general demands of these mediators are well above the market price. This also puts light on the impartiality of the judges and the general rules that the judges have to maintain. A general court case is hold in public and so it is subject to general examination and scrutiny, where there is no way that mediation process can be scrutinized. This aspect of the court cases promotes security and it also helps to prevent frauds in the proceedings of the cases. Confidentiality is an issue in the aspect in the court cases. If any dispute is quite contentious and difficult but still a settlement can be reached with mediation there will be no evidences to show what the methods are that were taken during the mediation proceedings. In a court proceeding one is allowed to examine the full process in case of any future disputes and the judges are hold accountable for their performance during the case and with the order of the law they can be disciplined, which is not present in the case of mediation. But still people want the process as it gives a resolution which is difficult to achieve in trials. The parties who need a quick solution or have similar financial conditions or want to continue their relation opt for the mediation process.
To achieve settlement with the mediation process the parties have to be willing to take part in the process, and once both the parties have agreed upon the process there will be other benefits. It is a process mostly used in commercial cases when a general clause is being incorporated into the general terms of contacts. This helps to ensure the methods of negotiation if any dispute emerges in the process. In USA, the cost is considered as the strongest factor for the organizations that use the process. This is very significant for commercial contacts and the parties that want to continue the relation after the mediation, which generally does not happen in court cases. Mediation, as earlier said helps to reach to the conclusion faster than any court case which tends to prolong the matter, and here the outcomes are generally more flexible than the court results. Some times ADR favors both the parties involved, while court proceedings are in most of the cases slightly one sided unless any counter claims come up during the trial. As per article 1, “facilitate access to alternative dispute resolution and to promote the amicable settlement of disputes…and by ensuring a balanced relationship between mediation and judicial proceedings”.
There are a number of causes which shows why the English procedural system has encouraged different parties to engage in the process. And it has led to the introduction of the EU legislation too. The preamble suggests that it ensures a sound relationship between the parties involved and the mediator. And the courts can enforce it too. There are several instances where the court has encouraged the parties to involve in a mediation process to settle an ongoing dispute during a litigation process. This is termed as “stay proceedings” and here the court can suspend the proceedings and recommend the process out of the court. Not only that the court can also give a stay of the proceedings and the parties involved in the litigation can suggest a stay to complete the affair through mediation. As per the 26.4(3) of the CPR the right is protected. It stated ‘The court may extend the stay until such date or for such specified period as it considers appropriate.’
In an overall view the CPR plays a very important part to encourage the appropriate use of ADR in some general circumstances. They have also introduced a number of Pre-Action Protocols to resolve the disputes only to avoid the litigation. It states, ‘encouraging the parties to use an alternative dispute resolution procedure if the court considers that appropriate and facilitating the use of such procedure.’
In accordance to the Practice Direction on Protocols 4.7,
“The parties should consider whether some form of alternative dispute resolution procedure would be more suitable than litigation, and if so, endeavour to agree which form to adopt. Both the Claimant and Defendant may be required by the Court to provide evidence that alternative means of resolving their dispute were considered. The Courts take the view that litigation should be a last resort, and that claims should not be issued prematurely when a settlement is still actively being explored. Parties are warned that if this paragraph is not followed then the court must have regard to such conduct when determining costs”
The pre action protocols aim to enable the two parties to engage in direct negotiation if they feel that in the litigation process they are being able to identify the claims they can make. These can also be taken into account when the costs are being calculated in the court and clearly mentioned in Sec 44.3. But mediation is not really mandatory in the UK, and it also does not recognize ADR for any kind of possible settlement which can result in different consequential aspects that can ultimately suggest that the English Law is pushing the aspect for mediation. This can be identified as an aspect that promotes meditation in several cases where the court feels about it.
The cost sanctions will be applied when a party has lost the case and after that applied for mediation process. It can be also applied to parties who have refused mediation without any reasonable cause. In the cases where a party is generally successful in the claim but it has initially refused mediation the party generally recovers cost from the opposing party and in some cases can be refused to give the costs. CPA, Part 44 discusses the actions the court takes while awarding the costs during the litigation process and finally leading up to the trial. While considering the general costs there are some different aspects that should be kept in mind, like if the case has been conducted before as well as while the proceeding was running and what the different aspects are in which the parties have followed pre-action conduct or any related protocols.
There have been a number of cases recorded where mediation failed to come up with a conclusion or there were no reasonable attempt had been made by any party. Here one can remember a famous case, Dennett vs. Railtrack plc in the year 2002 where the claimant had three horses stuck by a train when they crossed the boundary. The claimant said that the horses were killed as the defendant was negligent to keep the doors open, but the defendant was successful in the defence proceedings. The claimant later filed for appeal and the court asked to look for proper mediation, but the defendants rejected the suggestion, and they were also denied any costs as they refused to consider ADR.
In this context Lord Justice Brooke mentioned later,
“….a real effort should have been made by way of alternative dispute resolution to see if the matter could be satisfactorily resolved by an experienced mediator, without the parties having to incur the no doubt heavy legal costs of contesting the matter at trial... it may very well be that the mediator is able to achieve a result by which the parties shake hands at the end and feel that they have gone away having settled the dispute on terms with which they are happy to live…. A mediator may be able to provide solutions which are beyond the powers of the court to provide..… this part of the judgment of the court will draw the attention of lawyers to their duties to further the overriding objective in the way that is set out in Part 1 of the Rules and to the possibility that, if they turn down out of hand the chance of alternative dispute resolution when suggested by the court, as happened on this occasion, they may have to face uncomfortable costs consequence.”
Frankly speaking, the nature and merit of every case is not suitable for mediation. IT has happened that the party believed that they have a strong case, but it was not so and finally the extent of the settlement methods that are going to be applied in the process. Sometimes the costs of ADR can be disproportionately high. Sometimes delay in the actions can affect the process and finally every thing depends on the ADR and the amount of success that the ADR have.
Lord Justice Dyson referred to Hurst v Leeming had said that if mediation can have no real prospect of success in a certain case than a party can refuse mediation on the above mentioned ground. But the refusal of asking mediation can be considered as a high risk. At the point of time if the court finds some evidences that the case might be solved with the help of mediation and the party is refusing to take it up, then the party can be penalized severely. Here he used an example. Let us think of a case which is fought between two parties A and B. A is successful in the litigation process and had refused mediation in an earlier time in spite of the fact that B is willing in the mediation process that B is ready to bear the burden of showing that mediation is a reasonable route to solve the case. He also claimed that it is not really fair for a successful party to rely on the own unreasonableness in the cases of asking for mediation. IT is not any burden and generally the unsuccessful party in litigation can prove the fact that mediation was the way to success.
According to Lord Justice Dyson,
“…factors which may be relevant to the question whether a party has unreasonably refused ADR will include (but are not limited to): the nature of the dispute; the merits of the case; the extend to which other settlement methods have been attempted; whether the costs of the ADR would be disproportionately high; whether any delay in setting up and attending the ADR would be prejudicial; whether the ADR had a reasonable prospect of success...”
There has been a recent shift in which mediation is considered in the commercial context. It is desirable that the general commercial agreements must have a mediation clause in them. The Centre for Effective Dispute Resolution, which is a non-profit organization, has been trying to encourage mediation in the general commercial sector, and they have showed several interesting benefits of mediation and how the two parties involved in an mediation process can able to incorporate the different terms in to their contracts successfully. Even when there is a situation where there are no agreements or clause included there will be still an order for stay of proceedings. Here one can mention the Cable & Wireless v IBM United Kingdom Ltd. In the case the court said that the two parties can use mediation to solve a commercial contract. But there was a dispute between the two parties and both of them had been agreed in a clause that the problem could be negotiated internally and if the negotiation fails then only mediation can solve the problem. One of the two parties skipped the process and appealed in the High Court and the court ordered to ensure the case as earlier discussed as the negotiation had a binding effect.
In the context of Lightman J from Hurst v Leeming, Lord Justice Dyson referred that “If mediation can have no real prospect of success, a party may, with impunity, refuse to proceed to mediation on this ground. But refusal is a high risk course to take, for if the Court finds that there was a real prospect, the party refusing to proceed to mediation may, as I have said, be severely penalized.”
Generally the parties are attracted to the aspect of negotiation as there is an opportunity of confidentiality. But if the parties will be granted confidentiality is mainly based on the contractual interpretation and on the different clauses incorporated on the contract. As per the court the confidentiality is only applied in the aspect of mediation when the process is without prejudice negotiations. This is also known as non-mediated settlements as without prejudice privilege of the parties.
As per Judge Colman J,
“In the Commercial Court it is rare for proceedings to be stayed. The normal practice in this court is to adjourn the proceedings or to extend time limits or, more usually, to space out the case management timetable to allow a limited period during which ADR can be attempted…However, the availability of the remedy whether of a stay or an adjournment or other case management order must be a matter for the discretion of the court“.
As per Robert Walker LJ, this is one of the long established rules of the course. There are several propositions that have been listed by Neil Andrews about the context of mediation, like:
- Mediation applies to the general contents of mediation discussion, and it goes to cover the oral statements and any other documents created in the process as well as any input provided by the mediator who is present in the process.
- Unless both the two parties mutually agree, no party has the independence to discuss any other thing without the permission from the mediator.
- The mediator can not be able to disclose about any thing to a third party what he has heard during the process from both the parties.
- The confidentiality will be protected by including the power to obtain an injunction over the mediating process.
- Any party can not be compelled to produce any evident to show what has been happened in the mediation process.
- Brown v Rice in 2007 confirmed that in mediation when both the parties can adduce contents to prove the settlements and in that case the court can apply different contractual principles to find out if there is any binding settlement in the mediation process.
- The binding settlement must be in written words and both the parties must undersign the settlement.
In Instance v. Danny Bros Printing Ltd. The order of obtaining an injunction was first prescribed. In the case the injunction was granted by the High Court so to prevent information from a party who was operating as per the US proceedings. The information was privileged and considered as without prejudice and maintained the terms of the mediation agreement. Restraining a breach of confidentiality, an injunction has been issued in several other cases like Investment Placement ltd v. Hall (2005), David Instance v Denny Brothers Printing Ltd (2000) etc.
Confidentiality is generally protected with injunctions and most importantly without prejudice privilege, sometimes confidentiality created by the contract is weak in disclosing the general information in the civil proceedings. In the cases like Cumbria Waste Management Ltd v Baines Wilson and Assist v Secretary of State for the Environment Food and Rural the court has put the judicial interests ahead of the different contractual obligations when they dealt with confidentiality in the mediation process. This actually undermines one of the important benefits of the mediation process. There can be an exclusive list of exceptions as prepared by Robert Walker LJ:
- Determining a settlement has been agreed upon.
- If the agreement is procured through any type of misinterpretation, fraud or any type of undue influence
- There must be a clear statement to show that the mediation process had induced reliance from the other party involved.
- When the courts have issued a value judgment there should be unambiguous impropriety
- The delays in the process have to be explained
- Show the facts that the parties have taken proper steps to use the mediation process.
- The settlement negotiations have been clearly rendered in the process.
The exceptions are clear and the court in some cases needs to examine and subsequently modify the approach and there have been a number of cases where there are certain flaws. Like in Vesture Investment Placement v Hall the judge had supported the claim of the parties and said that there will be no breach of confidentiality, which can enable the parties to be involved in any type of criminal wrong doing. In the process the “veil of privilege” can be lifted if the parties can allegedly make threats to each other.
In this context, it would be relevant to mention the EU directive 2008/52/EC. In accordance to the Article 7,
“1. Given that mediation is intended to take place in a manner which respects confidentiality, Member States shall ensure that, unless the parties agree otherwise, neither mediators nor those involved in the administration of the mediation process shall be compelled to give evidence in civil and commercial judicial proceedings or arbitration regarding information arising out of or in connection with a mediation process, except:
(a) where this is necessary for overriding considerations of public policy of the Member State concerned, in particular when required to ensure the protection of the best interests of children or to prevent harm to the physical or psychological integrity of a person; or
(b) where disclosure of the content of the agreement resulting from mediation is necessary in order to implement or enforce that agreement.
2. Nothing in paragraph 1 shall preclude Member States from enacting stricter measures to protect the confidentiality of mediation.”
Actually all the directives are directed to achieve confidentiality in the civil litigation or arbitration processes. And the debate over mediation and ADR has provided us with a new channel of resolution. There is still debate going on over the effectiveness of also the researchers are concerned about the future of civil litigation and court proceedings. Though the legal system is a well established area, but still mediation becomes the cost effective way. To become a well established part of the legal system mediation has to have enough support from the legal body. The main objective in the process of settling disputes is to finally negotiate on a settlement. The general civil justice system can work collectively and co-operate with the different branches until the interconnection between civil litigation and mediation is done completely.
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