Mediation in litigation explained

What is mediation?

Mediation is a process in which an independent, neutral third party (a mediator) helps people involved in litigation negotiate and agree to settlement of the dispute.

The mediator is usually an experienced lawyer agreed to and appointed by lawyers for the parties to the litigation.

Will the mediator impose a decision?

Unlike a judge, the mediator does not impose a decision on the parties, but instead explores options with the parties and tries to find areas of agreement.

Whilst most disputes settle at a mediation, if you are not satisfied with what is being offered at the mediation, you are not forced to settle or reach agreement. If agreement is not reached the mediation ends and the parties continue with the litigation court process and eventually a court hearing (unless a settlement is reached in the interim).

Importantly, the information a mediator is given is confidential, so there is a greater scope for exploring ways to resolve a dispute than a judge has in court. If agreement is not reached at mediation, what has been said or offered at the mediation remains confidential.

Who pays for the mediation?

The parties share the cost of the mediator and the cost of a mediation venue, but the parties each pay their own costs of their own lawyers at the mediation.

If the dispute does not resolve at mediation, the costs of the mediation (the mediator, room hire and each party’s legal costs) are part of the costs of the litigation and if later agreement is not reached, the court will in hearing the dispute also decide who pays the costs of the mediation.

Who will be at the mediation?

The mediator, the parties, and their legal advisors will all be at the mediation. If the mediator and the parties agree, sometimes other persons (e.g. a witness, an expert, or a support person for a party) can also attend.

The mediator will usually ask that all persons attending the mediation sign a mediation agreement. This will include terms that cover responsibility for the costs of the mediator and also obligations of confidentiality on all parties and others attending.

How does the mediation work?

The mediator will be given copies of relevant court and other documents before the mediation so that the mediator knows the background to the dispute before the mediation commences.

Usually the mediation starts with an open session where the mediator, the parties and their lawyers are present. The mediator explains how the mediation will work, and then each party (usually through their lawyer) gives an overview of their claim/defence, and often the mediator will ask questions to clarify points. The mediator is “in charge” and controls who speaks.

After the open session, the parties usually move into separate rooms where the mediator will meet privately with each party and their legal adviser. These are called private sessions. In these private sessions the mediator will try to obtain a greater understanding of each party’s position and what they want to achieve from the mediation and anything said in the private session is confidential and not conveyed to the other party unless you expressly asked for it to be conveyed.

After the mediator has met in private session with the parties on one or more occasions, usually settlement offers are conveyed by the mediator from one party to the other and in this way the mediator tries to “broker a deal”.

This process can often vary and if the parties want, sometimes the parties or their lawyers might meet separately to discuss issues. The mediation process has the flexibility to adapt to the needs of the particular dispute.

What are the advantages of mediation?

Flexibility of outcome

The types of settlements you can reach at a mediation are far more flexible than the types of orders that a judge is able to make at a hearing.

Certainty

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