The approval of the final draft for a Convention on the Enforcement of Mediation Settlements at the 51st Session of the United Nations Commission on International Trade Law in June of 2018 and its signing as the Singapore Convention on the Enforcement of Mediation Settlement Agreements in August 2019 heralds a new period in that context; making it directly relevant to the international maritime construction and dredging industry and warranting a closer look at this junction in time.
In an early discussion held on 2 January 1818 and in the application for Royal Chartership for the Institution of Civil Engineers (Anon, 1928), Henry Robinson Palmer – the British civil engineer who would later become famous for the design of the world's first elevated railway but possibly of more direct influence on the maritime construction industry by means of his description of the principle of containerisation for the transport of goods – probably made one of the more poetic references to mediation when he said: 'an engineer is a mediator between the philosopher and the working mechanic; and like an interpreter between two foreigners must understand the language of both'.
Though clearly not intended as a reference to mediation as a form of Alternative Dispute Resolution (ADR), it is intriguing to note the skills of interpretation and comprehension being put centre stage in a pure engineering context here whilst one would likely expect them to be of equal, if not more, relevance to ADR. It is even more intriguing when one considers that mediation as an ADR process has – to date – not found a large inroad at all in the world of international maritime civil engineering and construction. The latter is a particular pity as mediation offers some distinct advantages when it comes to dispute settlement or de-escalation that other processes simply cannot offer. This lacuna is more than likely the result of unfamiliarity with the process and some deep-rooted misconceptions.
What is mediation?
For the sake of simplicity, mediation can be defined as a process supervised by a third independent party, in which the parties are facilitated in a strictly confidential setting in order to resolve the dispute between them.
There is another form of mediation, namely evaluative, in which the mediator is asked to give a (normally) non-binding Opinion on the merits of the matters in dispute. This Opinion can be provided at various stages of the mediation process. It could be provided before the participants meet with the mediator where the Opinion is thereafter used as a basis of settlement discussion between the participants to the mediation at the mediation itself. An alternative to the provision of an Opinion prior to the participants meeting with the mediator is for the mediation to commence and then after a set time, the mediation is adjourned to another set date for the mediator to provide an Opinion in the meantime to be discussed at the next date. This has the advantage of the Opinion being able to take into account what has been said at the earlier part of the mediation. Also, a break in the mediation can let the dust settle and potentially wiser counsels to prevail.
In order to understand the mediation process properly, it is important that those involved are fully aware that the role of the mediator is not one of an active judge, adjudicator or other decision-making person resolving the matters in issue between the parties, but rather that of a supporting helping hand in negotiating their own settlement of the difference or dispute. It is therefore the participants to the mediation that are and remain the owners of the dispute and its solution. They and they alone decide whether there will be a settlement and on what terms and conditions it will rest. It is therefore important that the party representatives who are delegated to a mediation actually have the necessary decision-making power for the party they represent.
Thus an important difference between mediation and more formal dispute resolution processes, such as Court proceedings or tribunal or arbitration, is that the parties retain control over the dispute and its settlement. Once formal dispute resolution procedures have begun, they will often continue along established procedural routes and will be subject to a timetable set by the body that presides over the resolution of the disputes. For example, the parties in that situation no longer have any control over events and they often find their way to a final hearing and accompanying decision almost passively. All this is in stark contrast with mediation where the parties are in full control of the procedure, and in fact also participate fully in it. The parties are free to decide whether they wish to withdraw from the mediation process at any time and whether they come to a settlement or not. It is this control over the process that the parties obtain that gives them the full, true, ownership of the dispute and its resolution and probably also explains why when resolution is achieved, it tends to be honoured and respected by the parties later on.
Having said that, the mediator obviously plays a central role in assisting the parties in the mediation to reach a settlement. Mediators are generally well trained, not only in negotiation techniques, but also in techniques to break through the blockages or stalemates in the negotiation process between the parties and intervene where necessary in the unproductive deflections that all too often find their way inside a negotiation. In addition, a mediator should ideally have insight into the commercial and technical aspects of the dispute but he should not necessarily be an expert in the matter.
Another essential feature of the mediation process is its confidentiality. In fact, mediation is confidential on two levels: first, the entire mediation process itself is a private and confidential process. Only the parties and their advisers are aware of the mediation and the details of the possible settlement that is reached. The latter will, however, lapse if the parties record a formal judicial agreement as these normally get openly published. More on that is set out further on in this article.
In the second instance, everything that is said in a private meeting between one of the parties and the mediator is also confidential. Such a meeting is usually called a ‘caucus’ after the old English term for a meeting of members of a certain political party without outsiders. The mediator - acting as a de facto broker- may not transfer information to the other participant to the mediation without the express permission of the participant imparting the information. The advantage of this is that the mediator and the relevant participant can safely talk about possible options which is obviously to the benefit of the mediation.
Since everything that is said within the mediation cannot be referred to in further legal proceedings and it is also not binding until an agreement is concluded, it is a very credible process for the parties to step into. It is important that the mediator is at all times independent from the parties, without interest in a particular outcome. It must be clear to the parties – and also clearly seen in this way – that the mediator actually does not choose a side and has no interest in a particular settlement.
In its most stylised form, mediation is truly a ‘process’ that people go through. There are no formal binding steps and various organisations tend to advocate slightly different templates or formats but in general, one can identify five steps or phases: Preparing, Opening, Exploring, Bargaining and Wrapping up.