Mediation / Alternative Dispute Resolution (ADR)
Mediation is increasingly the favoured method of resolving disputes and is the cutting edge way to settling disputes - without the sword!
Battling it out in Court can feel good and satisfies many of the human desires involved in conflict but it doesn't have a guaranteed result and can be very costly in both financial and human terms.
An article in the Times newspaper suggested that litigation is losing its appeal and since the introduction of the Woolf reforms appears to have reduced by about 37%. The article reported that Claims in the Civil Courts had fallen from 220,000 to 175,000.
The article points to the average mediation lasting 1.25 days, representing enormous cost savings. General statistics indicate that mediation resolves over 70% of all disputes. Private Mediators report successful resolutions in 80% of all disputes. These are impressive figures.
What is Maritime & Freight Forwarding Mediation?
- Mediation is essentially a voluntary and conciliatory process in which the parties to a dispute engage the assistance of a neutral third party (called the mediator) to facilitate negotiations between them with a view to solving their dispute privately and in an amicable manner.
- What transpires during the mediation must be kept confidential between the parties and may not be used for any other purpose. The information disclosed is privileged and may not be used by another party in legal proceedings.
- The mediator is a neutral person who helps the parties to negotiate a settlement. He does not decide the outcome of the dispute. His role is facilitative in nature. The decision whether to settle lies exclusively with the parties.
- The parties remain in control all the time.
Why use Mediation in Shipping & Freight Forwarding Disputes?
- Mediation is a more natural way to resolve disputes than litigation.
- Generally the parties to a dispute communicate more openly with each other.
- Mediation helps to bridge the communication gap.
- The Mediation process is informal and non confrontational.
- It is a rapport-building process.
- It allows the parties to maintain their social and business relationships while they try to resolve the dispute.
- This generally leads to a willingness to explore different options.
- As a result they are more likely to arrive at a creative and pragmatic solution.
Benefits of Mediation
- Both parties have to come to a consensus before the agreement becomes binding.
- Disputes that would have taken days or weeks of expensive litigation may be settled in a matter of hours.
- This combined with the informality of the process can lead to considerable savings in time and money.
- Management time is usually the element that is not taken into account when in litigation and can be just as expensive as the legal costs.
- Mediation is conducted without prejudice to other dispute resolution processes. The parties may revert to litigation or arbitration should the mediation not be successful.
Costs of Mediation
The cost of a mediation will depend upon the amount of the claim, the number of parties and the complexity of the case. Each case will be evaluated separately.
Miss Kershaw will discuss an estimate of the amount of the costs prior to any mediation.