“Our supplier is chasing us for payment, but what they have supplied is not up to scratch.”
“We have provided a great service, but now our customer won’t pay.”
Disputes are an unfortunate fact of business life. However well your firm is run, from time to time problems can crop up or misunderstandings can arise which, if not managed properly, can lead to unwelcome cost and souring of relationships explains Nick Carter, Partner in the Wilkes Partnership’s Litigation department.
When people think of a dispute “going legal” they are normally thinking of going through the courts, with all the expense of time and money that is involved. Not only can legal fees be high, but the cost of management time preparing your case and attending court hearings can also be very significant.
But there is an alternative way and one that most good dispute resolution lawyers should be ready to offer to their clients as an alternative to litigation. That is mediation.
Mediation is a very flexible process and is suitable for all sizes and shapes of case. Mediation involves the parties to a dispute allowing an independent third party to work alongside them to try to resolve the dispute.
The way it normally works is the disputing parties agree to appoint an independent mediator. If they cannot find a suitable mediator there are a number of professional bodies who can supply lists and CV’s of suitable people. Mediators come from a variety of backgrounds. Many are lawyers but others are from other professions or walks of life. In a suitable case the parties might find it helpful to appoint someone with specialist knowledge of their industry.
The parties each provide to the mediator a summary of their case with relevant supporting evidence. The mediator usually then meets with them to explore ways of resolving the dispute. This can be at a time and venue chosen by the parties and convenient to them. In straightforward cases the mediation could be conducted by video link or even by telephone.
During the course of the mediation the parties may remain together in round-table discussions or might adjourn to private rooms or even their own offices with the mediator acting as a go-between.
Unlike a judge or arbitrator, the mediator does not have any authority to impose a solution on the parties; instead his or her role is to assist the parties in identifying common ground, resolving issues and steering the parties towards a mutually acceptable outcome. A good mediator will challenge preconceptions and encourage the parties to think through the weaknesses as well as the strengths of their case. He or she should be an effective channel of communication between the parties.
Compared to litigation, mediation has the advantages that:
- The disputing parties remain in control of the process and do not have a result imposed on them;
- It is private – no dirty linen laundered in a public forum;
- It is generally quicker and cheaper than litigation;
- It is especially valuable where, notwithstanding a dispute, the underlying relationship between the disputing parties is a good one that they wish to preserve;
- Mediation is especially suitable for resolving multi-party disputes, for example those involving sub-contractors or other agents.
The process of mediation is entirely voluntary. The parties need only continue with it as long as they want to. Normally the parties will stick with the process as long as they think they are making progress toward an acceptable solution. If negotiations reach a point where it is clear that there is too big a gap between the parties and it cannot be bridged, the mediation can be brought to an end either by agreement or even unilaterally – no-one can be forced to mediate against their will. But this is rare. Mediation has an extremely good track record with a substantial majority of cases that are referred to mediation reaching a successful outcome.
It was once thought that suggesting mediation was a sign of weakness, that it meant you weren’t confident of taking your case to court. That is no longer the case. Now, a willingness to mediate should be seen as evidence that you are a forward thinking business that, when faced with a dispute, wants to resolve it in an efficient and cost-effective way and then move on with normal business life.
If you would like to speak to someone about your own situation or to find out further information, then please contact Nick Carter at The Wilkes Partnership on 0121 733 8000 or [email protected].