In understanding the benefits of the process of mediation it is important to understand what parties choosing to attend mediation actually want.
They want a quick settlement on reasonable terms and with a real participation in making the decisions with a chance to communicate and to be heard. In view of that, the benefits of mediating are wide-ranging.
Firstly, mediation is considerably less costly than litigation because the only expenditure is the mediator’s hourly/fixed fee and the relatively inexpensive cost of recording the agreement by way of a court order. If the disputes are settled early then it is certainly money well spent. In litigation, huge amounts are spent on lawyers and often experts in preparation, as well as court fees, not to mention the time spent away from the business focusing on the dispute.
The cost of litigating disputes may include fees for lawyers, experts and indeed court fees. Mediating disputes can halt legal proceedings and bring an end to a costly dispute. The indirect consequences of litigating can also be costly as, for example a business can grind to a halt awaiting a supplier to provide goods relied upon, or projects can stop indefinitely until resolution.
Secondly, whilst parties save money on protracted disputes, they also save time. Outcomes are often reached on the day and recorded in writing; once recorded it cannot be appealed, unlike in civil litigation. The agreements are then given a legal framework from the court which is final, binding and most certainly enforceable; the implications of breaching can therefore be significant.
Thirdly, it provides greater flexibility than the court process. Both parties can decide to attend mediation whenever a dispute arises (although it may be pre-condition within a contract) or even within a dispute that in going to an arbitration or court. Both parties can also choose a mediator, who they both feel has the knowledge and expertise within their area and who will be fair and equitable to both parties, as opposed to having no option like a judge in litigation. There is flexibility in the solutions suggested, as parties are allowed to be as creative as they possibly want as opposed to formal proceedings.
Fourthly, parties are empowered in the process of mediation and have the greatest possible opportunity for participation in determining the outcome for their dispute, for self-expression and communication. In short, the process is subjectively fairer than other forms of dispute resolution as parties are allowed a fuller opportunity to express themselves and communicate their views on issues that they view as important. This is the value of self-determination.
Fifthly, there is a greater chance of relationships being preserved rather than destroyed in the court process. At the heart of the majority of disputes are clashes of personalities. Perhaps the most significant feature of the mediation process, is the ability for both parties to resolve their dispute and continue their relationship as parties are full participants and can express their own opinions and concerns rather than their lawyers. Mediation allows parties to collaborate and reach a mutually beneficial settlement of all issues and ultimately continue working together; it prevents mutual demonization as communication flow is better. If decisions are imposed on parties by way of a court judgement or arbitral Award, there is more chance that the relationship will come to an end swiftly, and that is often not in anyone’s interest. In short, mediation produces higher levels of satisfaction and compliance.
Finally, mediation keeps issues private and the information is not subject to public knowledge. Furthermore, should the parties not settle, everything divulged to the mediator, including confidential information or offers, cannot be used outside of the process and parties will sign an agreement to this end before the mediation.
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