Med-Arb

Most mediations settle. The overwhelming majority, in fact. But, there will always be some that don’t.

At mediation-1st we’re not blind to the fact that sometimes there are cases where a settlement is not right for one party or the other. Sometimes, for example, the parties need a decision on a point of law. Sometimes, the parties need to “send a message”, and a contested court hearing may be the only way to do that. There may be other reasons why one, or both parties, may, sometimes, be better off not settling.

However, our experience at mediation-1st is that the parties to a dispute are, mostly, looking for a resolution. The parties don’t usually want a decision on a point of law. They don’t usually want to send anyone a message. They generally don’t want the cost, the uncertainty, or the stress of going to trial. They want to settle, and where the mediation does not produce a settlement, it’s because the parties feel they have gone as far as they can and simply don’t feel able to improve their final offer. Typically, in these mediations what was the “settlement gap” at the outset has been significantly narrowed, but a gap stubbornly remains.

In these circumstances, a Mediator has a number of tools available to help the parties close that gap. If that arises, the Mediator will discuss the appropriate options with you. But sometimes even the tools available to the Mediator will not be sufficient to enable him or her to close that final settlement gap.

At mediation-1st we are – to the best of our knowledge – unique amongst mediation providers in that we can offer a solution even in those cases where the parties have narrowed the gap considerably, but do not feel able to go any further. We have developed an association with a number of well respected and highly experienced Arbitrators.

For a fixed fee, determined by reference to the mediation fee, the Mediation Bundle can be passed straight to the Arbitrator and the parties can agree to be bound by his decision. There’s no need to prepare a new bundle. No need to incur expensive costs. Each party can submit a short further statement. The Arbitrator will then simply pick one of the parties' final offers made at the Mediation, usually within 21 days, and give a short judgement explaining in summary form the reasons for preferring that offer.

This is entirely optional: if the mediation does not settle, you’re free to walk away and have your day in court. But, for the party that does want to settle, if you’ve reached deadlock at the end of a mediation, and you’re confident that your offer is a fair one, what’s to lose? If you’re right, your offer will be chosen by the Arbitrator and the matter resolved without the cost and uncertainty of going to court, in a matter of weeks rather than months or years. Even if you’re wrong, and the Arbitrator picks the other party’s closing position, then (whilst that would clearly be a disappointment) it is certain to be a lot better than going to court and losing there.

All litigation is a gamble, and that includes going to court, and referring the case to an Arbitrator, but where the Arbitrator is picking between the parties’ closing positions, positions that were advanced at the end of a mediation, then, normally, the risks are minimised and the unsuccessful party is unlikely to lose as badly as they could do if things were to go against them in court. This is, simply, a way of reducing the risk, reducing the cost, reducing the waste of time, and taking the stress out of getting a decision if the mediation itself doesn’t produce a result. We call it “Pendulum Arbitration” and we have developed it at mediation-1st in response to feedback from clients suggesting that’s exactly the kind of service they would like at the end of a mediation that has remained deadlocked.

Of course, you could go direct to an Arbitrator and ask him or her to pick between the parties’ positions. However, we think Pendulum Arbitration works better as a last resort. It is always preferable if the parties can actually agree on a result themselves at a mediation and, anyway, the mediation process is invaluable in teasing out the best offers from each party before the Arbitrator is asked to choose one.

We hope that our Pendulum Arbitration service won’t be needed too often. We will continue to work with our clients to try to ensure that disputes reach a resolution at mediation that both can agree on. However, if that fails, it’s good to know that there may be a better alternative than going to court