Mediation is becoming an increasingly popular method of resolving commercial disputes. It’s quick, cost effective and keeps matters out of the court room.
Our recent mock mediation seminars in Manchester, Birmingham and London were designed to bring the mediation process to life for our brokers and outline how it can be used to resolve even the most complicated of disputes.
Our seminars were hosted with our partner law firm, Mills & Reeve, and based on a construction issue to show how clients and lawyers can achieve compromise in difficult and trying circumstances.
Here are the main takeaways from seminar:
Mediation, the basics:
What is mediation?
Mediation is the most popular form of alternative dispute resolution.
It starts with both parties (including their lawyers, and often an insurance claims representative) meeting to set out their case. A trained mediator then meets the parties separately and moves between them, often described as “shuttle diplomacy” trying to develop common ground and ways of resolving the dispute, which can take a while depending on the complexity and nature of the dispute.
The mediation process is non-binding and the parties are free to walk away. It is conducted on a without prejudice and confidential basis; whatever is said on the day cannot be referred to or relied on at a later date if mediation is unsuccessful. If or when an agreement is reached, it will be documented, signed and then is enforceable as a contract.
Why is it important?
Speed - ADR can be arranged within days or weeks rather than the months or years that can be involved in litigation or arbitration. It condenses weeks’ or even years’ worth of negotiation into a few hours allowing in-depth discussions to take place quickly.
Control - the parties agree everything – from the mediator, venue, timetable, procedure, agenda and what information is disclosed to the other side. Control over the decision making is therefore retained by the parties.
Cost - early settlement saves management time and legal costs, and is far more likely to be cost effective than a case that proceeds to trial.
Confidentiality – the process is entirely private which means unwelcome publicity can be avoided and any agreed settlement will not set a precedent. Reputations remain intact.
Flexibility of solutions - A court is restricted in the type of orders it can make. Mediation enables flexibility and a more creative, fairer settlement option. In the context of construction disputes, that can be particularly beneficial. For example, in a multi-party dispute agreements can sometimes be reached where one party undertakes remedial works at their own cost in terms of labour, with another party paying for the materials.
Mediation can be beneficial even if it doesn’t result in settlement by highlighting the major issues and enabling each party to focus on the more significant barriers to settlement.
Mediation and Claims Summary:
Claims and disputes are becoming more complicated and varied, and our expert claims handlers are participating in a growing number of dispute resolution cases, working closely with Insureds and brokers to ensure we get the best possible outcomes.
Mediation enables businesses to move on from the dispute with commercial solutions that benefit their long term interests and with relationships and reputations intact.
Tina Booth
Class Manager
[email protected]
Natalie Boardman
Underwriting Manager, Northern Region
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