What to Expect in Mediation
By Lovegrove & Cotton – Construction and Planning Lawyers
Mediation is a common form of dispute resolution in Australia. In fact, most matters settle before trial. Mediation is an important step towards facilitating settlement in disputes, and this is very much the case in building disputes. For the purposes of this article, we will consider the role of Mediation and what to expect during mediation, within the context of the Victorian Civil and Administrative Tribunal (‘VCAT’). The points mentioned in this article are, however, generally quite universal regardless of the jurisdiction in which the dispute is being heard.
During mediation, the tribunal or Court, and for our purposes, VCAT, appoints mediators to preside over and encourage settlement at mediation. Mediations are without prejudice to enable the parties to speak with candour without harbouring any fear that what they say or communicate will be held against them outside the ‘cloak’ of the mediation. The parties are required to prepare a position paper in advance of the mediation that will be submitted to the mediator and their adversary.
Participants are not required to engage lawyers at VCAT but by and large do. In the course of litigation at a Court, there will invariably be a lawyer involved. It is common practice for the each party to engage an expert witness to investigate and diagnose the cause of a compromised construction outcome. A report has to be prepared in accordance with VCAT expert witness protocols and the prescribed form. It is common practice for the expert witness to attend the mediation. Absent the attendance of the expert witness, the attorneys in the main have regard to the expert witness findings in their submissions.
The mediator begins the mediation by announcing that he or she cannot compel settlement, and rather is there to assist the parties resolve their disputes and differences. The mediator will normally request that the applicant make the first submissions and the respondent will then be afforded the opportunity to reply with submissions in rebuttal.
There is an expectation that the parties will conduct themselves in a civilised fashion but sometimes emotions can run hot in which case the mediator will endeavour to cool things down and get matters on track.
Once the parties have presented their submissions the mediator convenes private and confidential caucuses in break out rooms, talks to the parties confidentially to determine whether there are any ways by which there can be movement to an accord.
After the parties have spoken in confidence to the mediator, the mediator will obtain permission to convey their point of view to the adversary either in person or by way of a reconvened forum. It is best to put aside a day for the mediation.
Mediations have their own rhythm and no negotiation is the same as another. Plaintiffs are desirous of achieving the best possible settlement which, in the main, translates into the largest amount of money to ensure that there is ample reserve for rectification whereas respondents tend not share plaintiffs’ expectations in this regard. This polarity lends itself to protracted negotiations and repeated offers and counter-offers. Mediation is sometimes referred to as win-win when there is a negotiated outcome abetted by the services of the mediator. Conversely, there is a view that mediation is about “lose the least – lose the least” as one of the hallmarks of mediation is compromise, and compromise involves concession which means that one is not motivated by all-out victory. Unless the parties are prepared to compromise it is unlikely that there will be a negotiated outcome.
In circumstances where an accord is engineered, terms of settlement are entered into and signed by the parties. The terms of settlement are binding and, once signed, the case is concluded. When the settlement terms are not adhered to, the aggrieved can get the matter reinstated in the VCAT by way of directions hearing.
If the matter does not settle, the mediator will conclude the mediation and the matter will be referred to another directions hearing.
At that directions hearing, further interlocutory orders will be handed down and there will typically be an order for comprehensive discovery of all documents germane to the dispute. Sometimes the matter is set down for hearing but prior to the hearing date there is normally an order that the parties must attend a compulsory conference.