What happens at a mediation?
Mediations are a popular form of ADR which often take place over the course of one day. Whilst it will no doubt be a long and tiring day, from our experience it is a highly effective means of settling disputes.
In advance of the mediation both parties often exchange position statements which they also provide to the mediator.
The structure of the day is often as follows: both parties will start the day in separate rooms and the mediator will meet with each room. It is important for the ultimate decision maker of each party to be present who has authority to settle the dispute on the day. If the dispute is particularly hostile, the parties may agree practical ways to help facilitate the day, for example, to arrive at different times so as not to have any uncomfortable encounters in the car park before the mediation.
Then, there may be a plenary session where the parties come together in a third room with the mediator. This is not mandatory, but parties usually choose to hold this session and each party is given an opportunity to make an opening statement. Whilst the lawyers can speak on the parties’ behalf, it is often more compelling for the parties to speak themselves and to convey their commitment to the mediation process.
After the plenary session, the parties will retire back to their separate rooms and the mediator will shuttle between the rooms to explore the legal and factual issues. It is important for the parties to expect the mediator to interrogate their position, and to be open minded to this part of the process. Unlike the lawyers in the room, the mediator must be neutral and will no doubt also be interrogating the other side’s position.
The next phase of the day is making offers. If any offers are made before lunchtime this is usually a very encouraging sign. The parties should not get too entrenched into the question of who should make the first offer: if both parties are here to settle then this should not matter.
Once the first offer of the day is made, the mediator will then continue to shuttle between the rooms communicating counteroffers.
When the mediator is focused on their room, each party should anticipate being strongly pressured to improve their offer. Each parties’ lawyers will assist in these sometimes difficult and robust discussions by reference to the legal and factual issues in dispute. Parties should also be prepared for some periods of down time during the day whilst the mediator works with the other side to improve their offer.
Once a settlement is agreed at the end of the long day, most mediators will encourage the parties to record the settlement within a binding settlement agreement on the day to prevent parties from trying to resile from the agreement. On the whole, it is better for all parties if a settlement agreement is signed on the day but there is no obligation to do so. Therefore, once the settlement is agreed in monetary terms, the parties should be prepared for further negotiation of the settlement agreement to agree matters such as: confidentiality and agreeing what each party can say publicly about the dispute, the form of payment, the timing of payment, negotiating any warranties and indemnities, and considering possible tax implications.
Recently, some mediations have worked effectively online with each party in their own virtual room. However, in-person mediations are generally the preferred choice as mediations are generally more successful when they have the parties’ full commitment and undivided attention.
KBH specializes in swift and effective dispute resolution via mediation. We facilitate open dialogue, impartially exploring legal and factual issues, often concluding with settlements. While online mediation is an option, in-person sessions are preferred for enhanced commitment and success. Trust us for swift and effective conflict resolution.