Categories
Litigation

The Zen of the Mediation Act, 2017

mediation act 2017

The Mediation Act, 2017 came into law in Ireland on 1st January, 2018. The purpose of this legislation is to allow parties to a dispute to avoid the costs of litigation and to reduce the number of disputes coming before the Courts.

Mediation is a collaborative process which aims to encourage the parties to a dispute to arrive at their own solution, with the professional assistance of the mediator. The mediator is to facilitate the parties and provide his/her professional expertise and experience but the determination of the dispute is up to the parties themselves.

The mediator can make proposals to resolve the dispute when the parties request this. There may also be a need for experts in a mediation if the issues are complex-for example a financial dispute with taxation implications.

It will have significant implications for solicitors in their daily practice of advising clients, and for clients who wish to institute litigation proceedings.

Before commencing legal proceedings on behalf of a client a solicitor will have to swear a statutory declaration that

  1. He/she has advised the client of the availability of mediation as a way to settle the dispute
  2. Give the client information about the benefits of using mediation, as opposed to instituting legal proceedings
  3. Give the client names and addresses of mediators who may be able to assist in resolving the issues between the parties
  4. Tell the client that mediation is voluntary and may not be appropriate where the safety of the client is at risk or where there is children and their welfare/health/safety is at risk
  5. Advise the client of the need for confidentiality in a mediation and the enforceability of a mediated agreement
  6. Advise the client of the solicitor’s obligation to provide a statutory declaration confirming the provision of the information above to the client

The statutory declaration should accompany whatever document is used to commence legal proceedings. If this does not occur the Court can adjourn proceedings until such time as the solicitor has provided the Court with the statutory declaration.

The Mediation Act, 2017 will not apply to certain proceedings, for example High Court judicial review proceedings and an arbitration under the Arbitration Act, 2010. The full scope of the act is set out in section 3, Mediation Act, 2017.

A court will be allowed to take into account when awarding costs any party’s unreasonable refusal or failure to use mediation.

Part 2 of the Act sets out the provisions re mediation generally including the role of the mediator, codes of practice, and the enforceability of settlement agreements arrived at through mediation.

Part 3 sets out the obligations of solicitors and barristers with respect to mediation and Part 4 sets out the role of the Court.

Section 19, Mediation Act, 2017 is an interesting one as it allows a Court to adjourn court proceedings to facilitate mediation:

9. (1) Where—

(a) parties have entered into an agreement to mediate, and

(b) one or more of the parties referred to in paragraph (a) commences proceedings in respect of the dispute the subject of the agreement to mediate,

a party to the proceedings may, at any time after an appearance has been entered and before delivering any pleadings or taking any other steps in the proceedings, apply to the court to adjourn the proceedings.

(2) On application to it being made under subsection (1), the court shall make an order adjourning such proceedings if it is satisfied that—

(a) there is not sufficient reason why the dispute in respect of which the proceedings have been commenced should not be dealt with in accordance with the agreement to mediate, and

(b) the applicant party was at the time when the proceedings were commenced, and still remains, ready and willing to do all things necessary for the proper implementation of the agreement to mediate.

(3) This section is in addition to and not in substitution for any power of a court to adjourn proceedings before it.

Some commentators have advanced the opinion that an employer, with an employment contract containing a clause agreeing to mediation in the even of a dispute, can have Court proceedings adjourned pursuant to section 19. It is too early to say how a Court will view this argument but it is probably advisable for an employer to have such a clause in his contract of employment as he has nothing to lose in doing so.

Section 16 provides for a court inviting the parties to engage in mediation and section 17 provides for the mediator to provide a report to the Court to explain why the parties have not so engaged or to explain why the mediation has failed and they wish to re-enter legal proceedings.

Here is a link to the Court rules concerning the implementation of the provisions of the Mediation Act, 2017.

Conclusion

The Mediation Act, 2017 is to be welcomed as it should allow more parties in dispute resolve their issues without the cost of going to full blown legal proceedings including a Court trial.

And if you are an employer it cannot do you any harm to insert a clause in your contract of employment providing for the use of mediation before instituting legal proceedings.

Categories
Litigation

Alternative Dispute Resolution-Mediation and Arbitration

altervative-dispute-resolution
Alternative dispute resolution

The methods of dispute resolution fall into two broad categories:

  1. Final determination procedures
  2. Preliminary determination procedures.

Final determination procedures include

  • Litigation
  • Arbitration
  • Expert determination.

Preliminary determination procedures include

  • Mediation
  • Conciliation
  • Mini-trial
  • Med-arb
  • Dispute boards.

This piece will look at arbitration and mediation as alternative dispute procedures and why you might consider using them to resolve disputes.

Mediation

Mediation is a preliminary dispute resolution procedure which has grown in popularity in the last few years.

A mediator does not decide the issues in dispute between the parties; a mediator helps the parties to reach their own agreement through acting as a go-between. A mediator does not express his/her views and should remain impartial throughout.

Any decision of a mediator is non-binding on the parties.

Mediation is a completely confidential process and operates on a ‘without prejudice’ basis. This means that any information furnished be one party to the other cannot be used in subsequent litigation should the mediation not resolve the dispute.

Advantages of Mediation

The advantages of mediation over arbitration or litigation are

  • The parties have control over the outcome
  • The relationship into the future of the parties should not be damaged
  • The parties decide what issues can be introduced into the process with a view to reaching agreement
  • Implementation of any subsequent agreement is more likely to be more effective than an outcome reached as a result of one side ‘winning’ and the other side ‘losing’.

A mediation procedure should contain a date by which a consensual agreement is to be reached.

Arbitration

Unlike mediation, arbitration is a final determination procedure.

Arbitration is provided for in a variety of agreements eg holiday booking conditions, Law Society conditions of sale, RIAI building contracts, rent review clauses in most leases etc.

Certain disputes must be, by statute (the Arbitration Acts), resolved by arbitration. Apart from these obligatory arbitration situations, arbitration must be agreed to by the parties.

Advantages of Arbitration

The advantages of arbitration include

  • Privacy-arbitration proceedings can be held in private
  • Parties can choose who is to arbitrate and can choose an arbitrator with specialist knowledge
  • Flexibility-the parties decide on the procedures
  • Costs-parties can decide on the costs and retain some control over them
  • Speed-the parties can decide the pace of the arbitration procedure
  • An arbitrator’s decision is final and binding on the parties

Disadvantages of Arbitration

Some disadvantages of arbitration include

  • Costs-the parties will be responsible for the costs of the arbitrator in addition to their own costs
  • Collateral disputes-the arbitrator will have no say over disputes with third parties or other issues outside the arbitration process
  • Sanctions-an arbitrator cannot impose a sanction on any of the parties.

Irish arbitration law is contained in the Arbitration Act, 1954, the Arbitration Act, 1980 and the Arbitration (International Commercial) Act, 1998.

The ‘Arbitration Acts’ do not apply to employment disputes or to unwritten arbitration agreements.

Generally, any dispute concerning legal rights can be dealt with by way of arbitration, subject to some exceptions eg where the claimant is a child or where public policy issues dictated that some matters must be dealt with by the Courts.

There are 2 types of arbitration agreements:

  1. Submission agreements-this arises where there is agreement to submit an existing agreement to arbitration
  2. Arbitration clauses-an agreement to submit future disputes to arbitration

Arbitrator’s Powers

In addition to any specific powers given to the arbitrator by way of the arbitration agreement, an arbitrator also has powers conferred by statute (the Arbitration Acts) including

  • The power to make an award (interim or final)
  • The power to order specific performance of a contract (other than a contract in relation to land)
  • To examine witnesses on oath
  • The power to award costs
  • The power to refer any question of law for the decision of the High Court.

Courts in Ireland have indicated that they will not interfere in an arbitration process unless they are required to do so by a patent injustice or error.