Legal
The Minister for Justice and Equality, Frances Fitzgerald, has announced that she will publish the long awaited Mediation Bill this year.
The option to mediate claims (as opposed to going to trial) already exists in the Irish High and Commercial Courts. However, the proposed legislation will put the obligation to consider mediation on a statutory footing. It will introduce a requirement that litigants expressly confirm to the Courts that mediation has been considered.
Provision for costs sanctions for unreasonably failing to engage in mediation is intended to ensure that more claims are resolved by mediation; alleviating some of the strain on the Courts' system.
So what is mediation?
Mediation is an attempt to resolve disputes by agreement without going to trial at Court (or at arbitration). It is a confidential process where a neutral person (the mediator) helps the parties to try to resolve the dispute. If an outcome can be achieved which is accepted by both sides then it becomes legally binding.
Often the involvement of a neutral mediator, and the nature of the mediation process helps parties find common ground. If not, the parties can still go to Court (or to arbitration) and the mediation is without prejudice to their rights in that regard.
Does it not already exist in Irish litigation?
Mediation has been successfully used over the years to resolve numerous and significant claims in Ireland. The Irish judiciary have long been strong advocates of mediation1. Since its commencement, the Commercial Court has permitted judges to adjourn proceedings so that the parties could mediate.
Following the success of mediation in resolving Commercial Court claims, a similar provision was introduced allowing for the adjournment of other High Court proceedings for mediation2.
However, the process is voluntary - both sides must agree to engage in mediation. Although potential cost sanctions do exist for unreasonably refusing to do so, these have not, as of yet, been utilised by the Irish Courts.
Have we not been awaiting the publication of this bill for some time?
A mediation bill was included in the 2011 Programme for Government following on from the Law Reform Commission's 2010 report on Alternative Dispute Resolution: Mediation and Conciliation. The Draft General Scheme of Mediation Bill took on board many Law Reform Commission recommendations and was examined by the Joint Oireachtas Committee on Justice, Defence and Equality in 2012 but a final bill was not published. In September 2016 a Mediation Bill was included as Priority Legislation in this Government's Legislative Programme and recent public pronouncements suggest that it will be progressed this year.
So what will this bill do differently?
Although the bill has not yet been published, the Draft General Scheme Bill indicates its likely content. The most significant provision is the requirement that solicitors advise all litigation clients of the ability to utilise mediation as a cost efficient and effective means of resolving their dispute3. This requirement is bolstered by an obligation on solicitors to provide an estimate as to the cost of going to trial4. This will then provide parties with the ability to evaluate in monetary terms the effect of not mediating the dispute. It could be argued that this provision does no more than reflect the existing obligation on solicitors to act in the best interests of their clients, and to advise their clients of the advantages and disadvantages of the options available to them. However, it is useful to place this existing obligation on a statutory footing. Additionally, litigants will then be required to submit a statement to the Court confirming that they have been advised on the possible use of mediation.
Such provision requiring parties to consider mediation may be useful in eliminating what may be perceived as an obstacle to mediation or negotiation in practice. Often parties do not want to propose mediation or negotiation because it may be misinterpreted as a sign of weakness. The legislative endorsement of the process may make the parties less concerned about this possibility.
A mandatory stay on litigation proceedings will also apply in all claims in which the parties have agreed in writing to mediate. This should ensure that there is no procedural downside to mediation.
There is a proposal to establish a mediation council to oversee the development of this form of dispute resolution in Ireland and prepare codes of practice and to establish a register of mediators. However, there is scope for debate as to whether there is a need to establish such a body or register. Mediations have been operating successfully in practice in the absence of any such apparatus and there is a danger of adding unnecessary costs and complications to the process, which would be counterproductive.
Should all disputes be mediated?
Not all claims are suitable for or will benefit from mediation. Claims seeking vindication of Constitutional rights are not suitable and will still need to be determined by a judge. A party may be sceptical about mediation if it doubts the other's bona fides or if the other party is blatantly disregarding its legal obligations or seeking to use mediation as a delaying tactic – one example might be claims seeking recovery of an undisputed debt. This is reflected in the Revenue Commissioners publically expressed concerns that certain proposed provisions could delay its collection, enforcement and debt-management functions. Sometimes parties are too far apart for a mediation to have a realistic prospect of success. The bill's stipulation that cost sanctions should only be imposed where the refusal to mediate was unreasonable tacitly acknowledges that it will not always be unreasonable to decline to mediate.
What can we expect next?
Like all legislation this bill will have to pass through both houses of the Oireachtas. Recent news reports suggest that there is likely to be significant debate as to the exact form some provisions ultimately take before the Mediation Bill is published and approved.
By Liam Kennedy, Joe Kelly or Mark O'Shaughnessy of A&L Goodbody.