Mediation is a confidential process in which an independent mediator helps businesses resolve a dispute without a trial. Harper James advises businesses under the laws of England and Wales on commercial disputes, including mediation, negotiation and litigation.
The parties appoint a mediator, usually with relevant experience and no connection to either side. Each party provides a short position statement and key documents before the session. At the mediation, the parties normally meet together before holding private discussions with the mediator. The mediator does not decide who is right. Instead, they test the strengths and weaknesses of each position, identify the commercial issues, and explore possible settlement terms.
Mediation is commonly used for disputes involving unpaid invoices, shareholder relationships, contractual performance, intellectual property, supply arrangements and employment-related business claims. It is particularly suitable where the parties need a faster or more private process, or where they have an ongoing commercial relationship. It is less suitable where a binding legal precedent or a formal ruling is required.
A settlement is recorded in a written agreement, often called a settlement agreement or mediation agreement. It sets out the payments, actions, deadlines, confidentiality obligations and arrangements for ending the dispute. Once signed, the agreement is generally binding as a contract. Where court proceedings have already started, the parties usually notify the court that the claim has settled and deal with any required order.
The main costs are the mediator’s fee, each party’s legal costs and the management time involved. Mediation usually takes less time than a full trial, but its value depends on preparation, realistic assessment of the evidence and authority to settle. A business should review the contract’s dispute resolution clause, preserve relevant documents and calculate the commercial impact of continuing the dispute before attending. Courts in England and Wales also expect parties to consider appropriate forms of alternative dispute resolution, and an unreasonable refusal to engage can affect decisions about legal costs.