Law Society: Mediation can save businesses time and money
Irish businesses can save time, money and help to unclog the court system by using mediation as an alternative approach to dispute resolution, the Law Society of Ireland has said.
Ken Murphy, director general of the Law Society, said mediation is “easily the preferred first step in commercial dispute resolution – and can offer numerous benefits to companies that actually save time, money and can even save a business’s reputation from potential harm”.
Welcoming the passing into the law of Mediation Act 2017, Mr Murphy said he believed the legislation “can make substantial improvements to the legal system and commercial sector in Ireland”.
The Law Society said mediation had five benefits to companies:
- Significantly faster process: Taking a dispute through the courts can take time. Mediation offers a way to avoid the courts and seek an earlier agreement quicker.
- Substantially lower costs: The costs associated with resolving a case through mediation are generally substantially lower than costs associated with progressing cases through the courts.
- Maintains confidentiality: Mediation is a private, confidential process which can benefit commercial entities who are seeking to protect their business and reputation during disputes. Accredited mediators are bound by confidentiality and either side of a dispute are only bound to disclose information voluntarily during mediation, whereas there is less disclosure control and more public exposure in a court setting.
- Offers greater level of control: Mediation offers the ability for both parties in a dispute to maintain a greater sense of control over the process and settlement. Mediators are also able to explore more creative solutions to disputes, and aim to seek a mutually satisfactory outcome. A court setting normally results in a judge imposing a settlement on the parties involved.
- Seeks a mutually-agreeable solution: Business relationships and reputations are critical to maintain. Finding a mutually-acceptable resolution to a dispute - particularly where a business relationship is expected to continue following that dispute – is a must for many and mediation offers this potential outcome. A collaborative approach to resolving a dispute can ameliorate any ill will in the relationship, whereas a court-imposed settlement often leaves one party aggrieved.
Mr Murphy said: “The new legislation also means that any settlement reached in mediation can also be enforced by the courts, so offers a greater level of protection and certainty for business.
The Irish Commercial Mediation Association estimates mediation can save businesses up to 70 per cent in comparison to court. The Mediators’ Institute of Ireland reports over 80 per cent of mediated cases are successfully resolved at the mediation or shortly after.
Mr Murphy added: “These statistics indicate that mediation is effective, efficient, and can offer positive financial benefits for commercial and public sector organisations. The added benefit to Ireland is that mediation also leads to less cases being pursued through the court system, making that system more efficient as well.”