Using mediation to resolve commercial disputes

Adam Chaffer, Associate and an accredited mediator explains what mediation is and how it can be used to resolve business disputes.

Disputes can naturally arise in many commercial situations. Where a business relationship has broken down, the traditional method of resolution is to seek a determination of the issue in court. That process whilst necessary to achieve an outcome can be both time consuming and can be costly.

Mediation provides an opportunity for businesses to resolve disputes quickly, efficiently and often with a range of outcomes which the courts cannot achieve with traditional damage-based remedies or declaratory relief. The latest official industry figures show that around 17,000 commercial mediations were carried out in the UK during 2022, with that number following a sustained year on year rise.

Through mediation, individuals, companies and partnerships that are seeking to resolve their conflicts can do so pragmatically without incurring time and expense of progressing matters to trial by involving a qualified accredited mediator, who acts as an impartial individual providing a forum to facilitate the process of resolution.

It's an option that is applicable to businesses of all types and sizes and is especially useful when the participants involved in a dispute will either need or desire to continue to work together once the problem has been resolved.

The process is confidential and will normally commence with the mediator allowing both sides to outline their positions in an open session, helping to identify areas of common interest and facilitating the sort of positive discussion which might not otherwise be possible.

Occasionally, the mediator will play devil’s advocate to consider specific issues and to test the possible range of outcomes on a particular point.

Joint sessions where both parties are present may be part of the process, alongside meetings with each side, but it depends on the dynamics of the parties in dispute and how the time can be best utilised.

When such a settlement is reached, the participants will need to document the resolution in a legally binding agreement, which outlines the relevant terms and conditions and shows how the agreed solution should be implemented.

The time that mediation takes depends on the complexity of the situation and the availability of the parties involved, with the flexibility that it offers usually allowing for a more efficient and cost-effective resolution than protracted court battles.

Business disagreements may sometimes seem unresolvable, but with the right commitment from all participants, successful outcomes can often be secured far more quickly and efficiently through mediation than might otherwise have been possible.

For further information on our new commercial mediation service, please get in touch with Adam or call 0191 232 8345.