Mediation Bill 2017
25 May 2017
It is hoped that the Mediation Bill 2017 (“the Bill”), when enacted, will provide an efficient and cost effective alternative to court proceedings for all parties involved in litigation.
Mediation is a form of alternative dispute resolution (“ADR”), providing parties with a confidential mechanism to resolve disputes, with the assistance of their legal advisors and an independent, impartial third party mediator. While mediation is not a new concept and has been successfully used in the past to resolve numerous disputes, the Bill, once enacted, will put this process on a statutory footing. It sets out a structured framework for future mediations to include written ‘mediation agreements’ which must be reached between the parties and the mediator and the role of the courts in any such mediations.
Confidential and privileged process
Mediation is described in the Bill as being “a facilitative voluntary process in which the parties to a dispute, with the assistance of a mediator, attempt to reach a mutually acceptable agreement to resolve the dispute”. Importantly, the mediation process, to include all communications, records and notes relating to the meditation are confidential and are not disclosed in any proceedings before a court, save for some limited exceptions such as disclosure being required by law. Therefore, this process may appeal to those parties involved in particularly personal or confidential disputes who wish to avoid “airing their dirty laundry in public”.
Statutory obligation to consider mediation
The Bill creates a statutory obligation on all parties involved in litigation to consider mediation. This was likely influenced by the fact that the courts are increasingly urging parties to consider mediation. Solicitors must advise their clients of mediation as an ADR, in advance of issuing any court proceedings. While mediation will continue to be a voluntary process, ensuring that both sides must agree to engage in mediation and a party can withdraw from the process at any stage, there may be adverse cost implications where the courts consider that one party did not reasonably consider engaging in or attending a mediation.
Mediation agreement and the Statute of Limitations
In advance of commencing mediation, the parties and the proposed mediator must reach an agreement in writing as to how the mediation will be conducted. Matters such as fees and costs, location, termination and the fact that the process is to be conducted confidentially are to be agreed in advance. I
mportantly, from the day on which an agreement to mediate is signed, the time period, or ‘clock’, within which court proceedings must issue, having regard to the Statute to Limitations, is effectively paused until 30 days after either the mediation settlement is signed by the parties and the mediator or the mediation is terminated, whichever occurs first.
Role of the mediator
The mediator must act fairly and impartially during a mediation. Under the terms of the Bill, the mediator must make reasonable enquiries to confirm whether any conflicts of interest arise and step aside if required. He or she will be obliged to provide the parties with details of relevant qualifications, training and experience and provide a copy of any applicable code of practice which the mediator subscribes to.
This document is intended to provide a general overview and guidance on a particular topic. It is provided wholly without any liability or responsibility on the part of Eugene F. Collins and does not replace the necessity to obtain specific legal advice. © Eugene F. Collins 2017 The mediator is also obliged to conduct and complete the mediation as expeditiously as possible, having considered the nature of the dispute and ensuring that the parties are given sufficient time to consider the issues. If the parties to the dispute request it, the mediator can make proposals to resolve the matter but there is no onus upon the parties to accept any such proposal.
Role of the courts
Where parties, on their own volition, or at the prompting of a court, decide to engage in mediation, the courts may:
- Adjourn the proceedings;
- Make an order extending the time for compliance by a party with rules of court or with any order of the court in the proceedings; or
- Make such other order or give such direction as the court considers necessary to facilitate the effective use of mediation.
A potentially controversial section of the Bill relates to the requirement (in circumstances where a case is to go to mediation from the court) for the mediator to prepare and submit a report to the court. Where a mediation did not go ahead, the mediator must set out why it failed to proceed. In the case of a mediation settlement, the mediator must advise the court of the terms of settlement and where the parties failed to reach a mediation settlement, the mediator must advise the court if the parties fully engaged with the mediation (in his or her opinion).
Commentators have suggested that the various mediation bodies are of the view that this section of the Bill should be omitted as it will discourage parties from engaging in mediation given the risk or appearance that confidential matters will be disclosed to the court in any such report submitted by the mediator.
Enforceability of mediation settlements
Under the terms of the Bill, the parties to a mediation decide, if and when, a mediation settlement has been reached between them. In addition, whether a mediation agreement is enforceable is also a matter for the parties to decide. The Bill provides that a mediation settlement will have the effect of a contract between the parties to the settlement, unless the parties expressly agree that it will have no legal force until it is incorporated into a formal legal agreement or a contract to be signed by the parties.
Once the Bill is enacted, mediations are likely to increase significantly in light of the newly acquired legislative basis, which provides a clear framework to assist parties in resolving disputes and the mechanisms available to the judiciary to actively support this process. However, it remains to be seen if the requirement for a mediator to report to the court (on any mediation arising from a case before the courts) dampens the enthusiasm parties may hold to engage with this ADR.
For further information on this topic please contact:
Associate, Dispute Resolution department