Mediation is a process of intervention in a dispute or negotiation by an impartial third party who has no authority to decide the matter. The third party assists disputing parties to voluntarily reach their own mutually acceptable settlement by structuring the negotiation, maintaining the channels of communication, assisting each party to articulate their needs, identifying the issues and assisting the parties to develop creative ideas to resolve the dispute.
ADR Institute of Canada, Mediation Principles
Mediation is a structured negotiation process.
Mediation focuses on “needs and interests” rather than legal “rights and obligations.” An independent, neutral mediator assists parties in creating their own unique solutions to a wide range of business disputes.
Practical Resolutions combines training and experience in the mediation process with substantive knowledge and expertise in the technology and intellectual property fields gained from many years of industry experience. We also have commercial and licensing experience relating to franchising, product development and distribution, joint ventures, venture capital and project financing.
This first-hand knowledge enables us to work with the parties to identify and resolve the business issues that are at the heart of each conflict. Our ability to relate to the challenges the parties face enables us to quickly build a rapport and trust with the parties.
There is a common misconception that a mediator is the same as a judge or arbitrator. Nothing could be further from the truth. The mediator is a neutral facilitator who assists the parties in reaching their own negotiated resolution of their dispute.
Mediation is confidential. Settlement discussions at mediation can’t be used later in arbitration or litigation, if the dispute is not settled. Mediation is low risk. All discussions are non-binding until the parties reach an agreement. The mediator does not decide who is right or wrong or dictate the final outcome.
Mediation is most effective when the disputing parties are willing to consider creative solutions and explore opportunities for mutual gain.
Studies show success rates of more than 80% when parties work with an experienced mediator with subject matter expertise. Many disputes that are not completely settled at mediation will resolve at least some of the issues, or settle very soon afterward. Parties report a higher level of satisfaction with mediation than litigation regardless of outcome, because mediation is designed to ensure that all parties fully understand their own and each other’s needs and interests and participate in the creation of the business solution.
Interest-based mediation is generally seen as a facilitative process. The mediator does not make judgments about which party is right or wrong. He or she encourages the parties to stop arguing about who is right and focus instead on options for a negotiated settlement.
The mediator’s role is less concerned with the particular outcome of the dispute and more concerned with the settlement process – identifying issues and underlying interests, exploring settlement options, facilitating the parties’ internal evaluation of settlement offers and communicating those offers back and forth.
When parties are at an impasse, the mediator may provide a neutral evaluation of the case, express expert opinions, suggest possible solutions and work with both parties to bridge gaps. The mediator may act as an independent negotiator for both sides. Parties may be encouraged to prioritize their objectives and the mediator can assist in the “horse-trading” needed to achieve an optimal resolution. Because the mediator knows which issues are most important to each party, he or she can help parties quickly resolve the easier issues and develop creative solutions for the harder ones.
Most commercial mediation involves a combination of facilitative and evaluative approaches.
This model begins with a facilitative phase. The mediator actively engages in questioning the parties, framing the issues, and brainstorming options, but offers no opinion or recommendations on the possible outcomes. The mediator will typically also meet with the parties in private sessions to further probe relative strengths and weaknesses and invite the parties to propose solutions. This phase usually includes further negotiations, either directly between the parties or through a “shuttle” process.
If the parties do not agree on a settlement, the mediator adopts a more evaluative role. The mediator may express an opinion as to which party has a greater chance of success if the dispute goes to arbitration or litigation. The mediator may also make settlement proposals, to attempt to bridge the gap between the parties. The parties may choose to engage in further face-to-face or indirect negotiations based on one or more of the mediator’s proposals or their own alternatives. In many cases, this evaluative phase will break an impasse between the parties and lead to a settlement.
Practical Resolutions endorses this hybrid model. This what happens in most commercial mediations, regardless of whether mediators hold themselves out as facilitative or evaluative. At some point in the process, the parties always want to know what the mediator thinks, especially if the mediator has some subject matter expertise.
The mediator’s challenge is to know when to shift from a facilitative to an evaluative approach. Sometimes, it’s obvious. The parties are at an impasse; they may have resolved some of the issues but are stuck on something – often money. Sometimes, it’s not so clear. The parties are continuing to talk, but going around in circles on a number of options. They aren’t making any progress and need a push or new idea.
As mediators we must be ready to shift back and forth between facilitative and evaluative styles, as the situation requires. The parties may not even realize it is happening. The mediator is simply reacting to the internal dynamics of the dispute, helping the parties define their needs and wants, evaluate the settlement risks and opportunities and negotiate toward the desired goals.
Our objective, at all times, is to assist the parties to find an effective, sustainable resolution to their dispute – one that meets their underlying business interests.