It is common for commercial dispute lawyers to be described as 'litigators', but the skills and tools employed by the modern dispute resolution lawyer are far more versatile than that label suggests.

In this article we look at mediation as a crucial dispute resolution tool, which can often prove to be the most efficient, versatile and cost-effective means of resolving even the most complex of disputes.

It is sometimes suggested that mediation is not given sufficient prominence as a means of dispute resolution. However, for us, the appropriate use of mediation has long been an important strategy for resolving complex commercial disputes, and it can be particularly in useful in the specialist field of professional negligence .

In the right case, mediation can be a powerful process and our clients have used it to good effect in numerous cases, often where the issues are particularly complex and the different perspectives of the parties have caused a strained relationship which is perhaps difficult to overcome via ordinary negotiations.

The mediation carrot and the litigation stick

The most obvious benefit of mediation compared to litigation relates to cost: mediation is often quicker and cheaper. The prospect of resolving, often in a single day, a dispute which may take months or even years to pass through the courts, can be extremely attractive.

The commercial reality is that, behind the 'carrot' of a swift negotiated resolution, there almost always lies the 'stick' of threatened litigation. Mediation can also provide an opportunity to resolve a dispute with the option of preserving relationships between the parties.

Mediation is usually also a confidential process, so the public airing of dirty laundry can usually be avoided, allowing the parties to keep their reputations intact.

Versatility and Innovation

The availability of practical solutions allows the parties to be innovative when resolving a dispute.

Other forms of formal dispute resolution, such as adjudication, arbitration and litigation, usually only have the rather blunt instrument of monetary damages at their disposal. By contrast, as mediation is a consensual process and no solution is "off limits", the parties are free to agree whatever settlement terms suit their particular circumstances.

For example, in a dispute about the condition of a property, one party might agree to purchase the building from another or carry out repairs. Or in a dispute about contractual services, a party may agree to provide some future services at a discounted rate, rather than meeting an outlay for compensation, thereby keeping a commercial relationship alive.

A good mediator will help the parties work out what their true goals and motivations are and help them find a way to come to settlement terms which meet those needs; and which all parties can live with.

Does mediation always work?

As testimony to the effectiveness of the process, we can think of very few examples where mediation has not fully resolved the dispute. Even then, the mediation process is nearly always of considerable benefit, giving the parties a much better understanding of each other's positions.

It should, however, be remembered that mediation is not always appropriate. Sometimes traditional negotiations can be more cost-effective and other times one or more party has a particular reason for declining to mediate. The timing of an offer to mediate can be crucial to success as mediation succeeds most often where the parties can countenance the possibility of compromise and have "skin in the game", with the prospects of a dispute becoming clear. Parties also need to be able to assess the risks prior to the mediation, which means obtaining, and usually exchanging, key pieces of evidence in advance.

Increasing importance in uncertain times

The impact of Covid-19 and the restrictions put in place can mean that the court process is now lengthier than usual. This might add to the attractiveness of mediation as a realistic alternative.

In many ways, technology has been the saviour of the legal system, with hearings now routinely taking place via video link. The flexible format of mediation is perfectly placed to take advantage of the types of technologies now being used in daily business and indeed in the courts. Most commercial mediators are now offering virtual mediation as standard.

Those prepared to embrace the pace of change may now find themselves able to resolve a complex dispute without even leaving home!


James Jerman

Senior Associate