There is much to commend mediation as a process – speed, costs savings, privacy. But there are two other important benefits. The first, is the opportunity to design a process that encourages constructive dialogue in circumstances where it is all but impossible. The second, is the opportunity to achieve an outcome that it would be impossible for a court or arbitral panel to order or award, that is far better suited to the parties and their needs.
Two recent cases illustrate these benefits:
The first, was a multi-party dispute arising out of the development of a brown field site. Various lenders supplied development finance to a development company which subsequently went into receivership. Various claims followed, including against and between directors/guarantors and allegedly negligent valuers. The dispute was complex, costs were a nightmare and everyone wanted to settle. But the disputes as between the directors and guarantors meant that any meaningful dialogue with other parties was impossible, as a year or so of costly solicitors’ without prejudice correspondence had demonstrated.