The Benefits and Drawbacks of Mediation

The Procedure

The mediation process will be determined by how mediation is initiated. For example, a contract, a court or tribunal, or an agreement to mediate can trigger mediation.

A contract can state that if there is a dispute about the agreement or any matter of contractual import or bearing, the parties must go to mediation. A well-drafted mediation clause will require the parties to agree on a mediator. The case will be referred to a nomination body to nominate a mediator in the absence of agreement. Peterborough mediation

The contract will state that the mediator is free to conduct the mediation as they see fit, but it will also note that the parties are free to terminate the mediation if the mediation fails. In contrast, the contract will state that if the dispute is resolved through mediation, the terms of settlement that underpin that agreement must be in writing, co-signed by the parties and the mediator, and the contract will then be binding.

Below is an example of a contract-induced mediation clause.

Disputes must be resolved through mediation by the parties.

Before commencing legal proceedings, the contracting parties must use the mediation procedure to resolve a dispute.

The mediation procedure is as follows:

The party seeking to resolve a dispute must notify the other party and the selected mediator, or, if that mediator is unavailable, a mediator appointed by the president of the Law Institute.

The notice of dispute must state that a dispute has arisen and the issues at issue.

The parties must work with the mediator to reach an agreement on technical issues. In addition, each party must contribute half of the cost of the opinion.

If the dispute is resolved, the parties must sign a copy of the settlement terms.

If the dispute is not resolved within 14 days of the mediator’s notice or within any extended time agreed to in writing by the parties, the mediation must be terminated.

Each party must pay the mediator a half-share of the mediator’s fees.

The terms of the settlement are binding on the parties and supersede the terms of the contract in the event of a conflict.

When mediation ends, either party may file a lawsuit.

Settlement terms may be used as evidence in any mediation or legal proceedings.

The parties agree that any written statements were given to the mediator or one another. During the mediation period, any discussions between the parties or between parties & the mediator will not be admissible in any legal proceedings by the recipient.

Mediation Ordered by a Court or Tribunal

Most courts require that litigated matters be referred to mediation before proceeding to a hearing. The courts usually have a published list of mediators from which the parties can choose, and each party is responsible for the mediator’s fees.

If the mediation facilitates a settlement, the case is closed, and the legal proceedings are terminated by consent. However, if the mediation fails, the patient will almost certainly proceed to trial.

In some jurisdictions, such as the VCAT (Victorian Civil and Administrative Tribunal), the parties are not required to pay for the mediator, which is significant cost savings and benefits.

Mediation Based on an Agreement

Any party to a dispute, whether civil, commercial or planning, can agree to mediate at any time. All the parties need to do is find a mediator and settle the dispute in good faith.

There must still be rigour; there is little point in settling a dispute unless it is agreed in writing, witnessed, and evidenced by an instrument stating that the parties have agreed to resolve all of their conflicts and differences concerning the subject matter.

Any mediated settlement agreement must be comprehensive, well-drafted, and include all of the issues that arose in the dispute. Poorly drafted settlement agreements are open to challenge and are frequently challenged when one of the parties believes that the outcome could have been better in retrospect.

The Characteristics

A mediated outcome has significant merit if matters can be judged at the onset of a dispute. If negotiations fail, there is little doubt that mediation is the quickest and cheapest way to resolve a dispute. I have insisted on including a mediation clause in any partnership agreement I have entered into with fellow practitioners or business people. The court is only used as a last resort.


Confidentiality is one of the apparent benefits of mediation. If a dispute is settled through mediation, the parties can keep their grievances “in house.” If any “dirty linen” is found, it is “washed” in-house, never in public. This is especially important for people in positions of power because reputations, especially in this day and age when communications via the internet are instant and widespread, mean that anything obnoxious can be seized upon and published quickly. Furthermore, once the odium is released, it can never be archived or stored in a vault dedicated to the heinous. Information published on the internet is available in perpetuity to all and sundry. As a result, the need for confidential dispute resolution is more significant than ever, and mediation is a useful, if not always perfect, method of accomplishing this.

However, not everyone believes that confidentiality is a benefit of mediation.

“It could be argued that the reality of confidentiality in mediation is heavily reliant on the parties’ goodwill. If the goodwill fails, then, somewhat ironically, whether confidentiality is maintained or not is dependent on relatively insecure legal protections.”

“From the standpoint of ethical marketing, it is less than desirable to use the concept of confidentiality to promote mediation, especially without providing full disclosure about the qualified nature of the concept in practice. The integrity & legitimacy of some of the claims made about confidentiality in mediation can be seriously called into question.”

One of the perceived benefits of mediation is confidentiality, but in practice, as the co-authors argue, this may be an assumption rather than a fact. In some cases, settlement condition “belts and braces” should be used to ensure confidentiality. When a settlement is reached through mediation, the settlement agreement should include a confidentiality clause actionable in a court of law if violated. If confidentiality is part of the consideration in settling a dispute, it should be expressed as such; otherwise, a breach of confidentiality is a breach of that confidentiality provision and actionable.

A more significant issue arises if mediation does not result in a settlement. In these circumstances, how confidential is information conveyed during negotiations? According to Field, Rachael, and Wood, whether information remains confidential or not is dependent on the parties’ goodwill. All well and good, but it is of little comfort to disputants who are at odds with one another, especially if the mediation proves futile and, on occasion, counterproductive and a source of tension.

Information gathered under the apparent guise of confidentiality and open exchange can be a precious intelligence-gathering exercise. In mediation, one can learn about people’s personalities, fears, apprehensions, and weaknesses. Some people attend mediations with no intention of resolving a dispute but are content to go through the motions of the process to gather intelligence and insight into the level of resolve that the other party may have.

When one is encouraged to speak freely under the apparent protection of confidentiality, this is not strictly “keeping one’s powder dry.” Some cases, rightly or wrongly, are won through deception, the careful metering out of one’s best arguments, and the element of surprise. This is not a lack of ethics, nor does it imply that a party withholds information or documentation that is readily discoverable; instead, it is litigation ringcraft. If the goal is outright victory rather than a negotiated outcome, the element of surprise and keeping specific scenarios in reserve are essential.

To digress a little, the author had a case running for about eighteen months at the time. The case was reasonable, and there were some good arguments to be made, but it could have gone either way. From the start, a capable junior barrister had been retained. The other side’s barrister, who was also relatively junior, appeared to be getting the better of our colleague in mediations and interlocutory proceedings. The author decided to brief a queen’s counsel when the hearing date was announced. Unbeknownst to opposing counsel, the QC was only told for the first day, while the junior barrister was briefed for the remainder of the case, which was scheduled for 21 days.

The author was careful not to mention to his opponents that the opening had been briefed to a QC. This was not malicious, as there is no ethical obligation to reveal the identity of anyone who has been reported to do the opening. The opponent’s camp thus assumed that our junior counsel would show up on day one to run the trial. The appearance of a queen’s counsel came as a surprise to the other side, as the other side assumed that the QC would run the test to completion.