The implementation of the DIAC Mediation Rules 2023 (the Rules) on
Under the Rules, any party may refer a dispute to mediation before the
The primary aim of the Rules is to ensure that all mediations are conducted with the utmost fairness, impartiality, efficiency, and proportionality, taking into consideration factors such as the dispute's value and complexity. Parties, with the mediator's approval, have the latitude to make written adjustments to the Rules, provided such modifications are aligned with the Rules' core principles and do not hinder their functionality.
Once a party submits a mediation request to the
Under the Rules, the parties can jointly nominate a mediator, or in the absence of an agreement, the
The prospective mediator is required to sign a declaration of impartiality, independence, and disclose any conflicts of interest. The parties may, however, object to the appointed mediator within a specified timeframe, with the appointment standing if no objections are raised.
The Rules require the mediator to promptly contact the parties within seven days of receiving the case file to schedule a preliminary meeting and potentially share a draft mediation agreement for review. The preliminary meeting can be conducted in person, over the phone, or, more commonly, through video conferencing. During the initial meeting, key aspects such as the mediation agreement, procedural language, logistics, confidentiality, attendees, timing of position papers, treatment of ongoing proceedings, and other relevant procedural matters are agreed upon.
The determination of the mediator's fees and expenses occurs during the preliminary meeting, accounting for the case's complexity, value, and anticipated timeline. Typically, both parties share the responsibility for an advance deposit equally, although one party may choose to cover the other's share to facilitate the mediation process. If applicable, the parties will usually deal with the issue of their legal costs during the mediation and in any settlement agreement. In the event of a successful mediation, the costs and expenses typically amount to a fraction of what they would have been had the case gone through the entire arbitration or litigation process.
On the day of the mediation, the mediator's role is to facilitate the parties in reaching a mutually agreed settlement, which is then hopefully recorded in a settlement agreement on the day or very soon after. The mediator has discretion in determining the procedure on the day, ensuring each party has a fair opportunity to present their positions. For example, to set the scene, the parties might present their respective cases before the mediator meets with the parties individually or altogether. The mediator may need to shuttle between the party's separate breakout rooms, hold lawyers-only meetings to focus in on the legal issues, or even meet with the parties in the absence of their lawyers should that be appropriate. Mediators will undoubtedly have different methods for unlocking any deadlocks and will often have to change approach depending on the progress being made towards a resolution on the day. In the event that a mediation does not lead to a settlement, either party or both parties jointly may terminate the process, with no prejudice to the merits of the dispute.
At the heart of the Rules lies the paramount obligation of confidentiality which is crucial in fostering an environment of trust and openness during the mediation. The Rules' confidentiality terms are especially important in a civil law jurisdiction like
In this regard, at the time of writing, it seems unlikely that a
Without statutory guarantees precluding the use of confidential, mediation-related information in subsequent court or arbitration proceedings, the parties shall be relying on the subsequent arbitrator or judge to honour the confidentiality provisions in the Rules and in their mediation agreement. With this in mind, only time will tell if parties in
In conclusion, mediation has long been recognised globally as a valuable alternative for resolving commercial disputes. When the process is successful, mediation can undoubtedly result in an efficient and cost-effective resolution of a dispute, with the added possibility of parties retaining an amicable relationship to continue doing business together. It is hoped that the introduction of the Rules will stimulate greater interest and engagement in mediation within
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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