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Mediation in business disputes to double
Sunday, March 01, 2009 By Kieron Wood
Attempts to resolve commercial disputes by mediation will double over the next year, as businesses seek a cheaper and faster alternative to litigation, according to a new survey.

The Irish Commercial Mediation Association (ICMA) issued a questionnaire to the managing partners of more than 3,500 law, accountancy and other professional firms to ascertain attitudes towards commercial mediation and compile statistics on mediations over the last three years.

Commercial mediation is a private process of assisted negotiation. If agreement is reached, it is legally binding. The ICMA said that, given the poor economic climate, clients were seeking a cost-effective solution to commercial disputes, while minimising business disruption.

According to the ICMA survey, three quarters of lawyers, accountants and business consultants rank mediation as their first preference for dispute resolution, followed by conciliation, arbitration and litigation.

Two thirds of lawyers and more than a third of accountants said they had experience of mediation, while one in three law firms and one in five accountancy firms now had an accredited mediator.

The respondents said the key advantages of mediation were cost (saving up to 70 per cent on litigation), speed, control of the process and the preservation of business relationships. The survey found that mediation was most widely used in family businesses and construction disputes, followed by partnership conflicts, property issues and business terminations.

Statistics from the Commercial Court - a branch of the High Court which expedites multimillion-euro cases - indicate that almost two thirds of cases referred to mediation last year were successfully settled. Almost all the professionals surveyed by the ICMA said they were now aware of mediation - up from 56 per cent in 2006 - and 70 per cent said that the Commercial Court had contributed to increased awareness.

ICMA spokesman Austin Kenny said: “Although commercial mediation is still relatively new in Ireland, there has been a significant increase in the number of cases dealt with through mediation in the last year. Cases are typically dealt with in three to six weeks from commencing the process, which is significantly quicker than going to trial.

“Through their direct involvement in the process, the parties can often end up with a more creative solution than litigation can provide.

The process creates an opportunity for important relationships to be repaired which could otherwise be damaged by litigation. In some cases an apology or explanation, rather than money, is central to disputes being resolved.”

The results of the ICMA survey will be released on Friday at its conference in Croke Park, chaired by Mr Justice Peter Kelly of the Commercial Court.

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