Mediation is a formal meeting in which a third person (the mediator) assists people in dispute to find a solution to that dispute.

A mediator is a person skilled at assisting people in dispute to manage a respectful dialogue in a difficult and stressful environment. The mediator’s role is not to provide advice to the parties, nor to make a judgment or binding determination in relation to the merits of the dispute. Rather, the role of the mediator is to aid parties in identifying and agreeing to a suitable resolution.

A mediation may arise to informally resolve a dispute before court proceedings are commenced (e.g. two neighbours disputing a new fence), or may be arranged at a time during a proceeding. If the parties have not participated in a mediation, it is common for the Court to order that the matter be referred to mediation prior to a final hearing.

Confidentiality

The mediation process has two layers of confidentiality. The first layer is that the entire process is confidential and cannot be referred to outside the mediation. This is to ensure that parties can speak openly and frankly about their dispute during the mediation in an attempt to find a resolution. The confidential and ‘without prejudice’ nature of the mediation means that nothing a party says, nor the offers exchanged, can be used against a party or otherwise referred to in Court if the matter proceeds to a hearing.

The second layer of confidentiality is in the private rooms during private sessions between one party (and its representatives) and the mediator. Anything a party says to the mediator in the private session remains private unless the party gives the mediator permission to disclose it to the other party. It can be helpful for the mediator to understand the broader context and issues that may not have been disclosed in the joint session so they can work out how to help the parties move towards a resolution.

Who is involved in a mediation?

In addition to the mediator, the following people may be present at a mediation:

The parties

Each party is expected to attend the mediation themselves, although sometimes (for example, where a party is insured or is an insurer) another person will attend as a party’s representative. The party or the party’s representative must have the authority and capacity to settle the dispute.

Legal representatives

Each party’s legal representatives will generally attend with the party. Sometimes this is their solicitor and sometimes their barrister may also attend.

Support people

Subject to agreement from the other party, a party may also have a “support person” or advisor present. This person will usually be required to sign a confidentiality agreement (being bound to the confidentiality of the mediation process) and, while they may provide support and guidance to the party, should take care not to unduly influence or make decisions for the party.

What is the process of mediation?

A mediation is a flexible process which is determined by the mediator to best suit the parties to resolve the dispute.

The process of a mediation can be influenced by a number of factors, including the nature of the dispute and the relationship between the parties. A mediation can be an emotional and exhausting process for parties. It may be appropriate to take a short break or end the mediation early if a party becomes distressed. This is a decision the mediator makes during the day.

It is important for parties (and their legal representatives) to communicate openly with the mediator about any concerns they have that may influence the process so that the mediator can determine the appropriate course of action.

Although every mediation is different, generally the process involves the following steps.

Provision of dispute material and a position paper

Prior to the mediation, each party (generally via their legal representatives) will provide material relevant to the dispute to the mediator. They also provide a position paper, which is a short document summarising the dispute and the party’s position and objectives coming into mediation.

These documents are generally provided to the mediator at least one week prior to the mediation.

Pre-mediation meeting

Each party may be invited to have a brief confidential meeting with the mediator before the mediation begins. This may occur on the day of, or some days prior to, the mediation.

The purpose of this confidential meeting is for the parties to communicate anything they consider to be particularly important to the mediator, and for the mediator to outline the process they propose for the conduct of the mediation.

Joint session

The mediation often starts with a joint session with the parties, their legal representatives and the mediator present. In some cases, such as matters where there is a history of violence between the parties, only lawyers will attend the joint session, or there may be no joint session at all.

In the joint session (sometimes referred to as an ‘opening’ session) each party sets out what they identify as the issues, and their proposed solution. It may continue with other information being shared to help each party understand the issues. In some cases an offer may be made by a party during the joint session.

Private sessions

Following the joint session, the parties will be separated into private rooms with their legal representatives, and the mediator will usually meet with the parties in private sessions in turn.

The mediator may discuss the issues in dispute further with a party, as well as exploring proposals for settlement. The mediator will also convey offers made by the parties during the private sessions, and can assist parties in deciding whether to accept an offer or make a counteroffer.

Final joint session

Sometimes it is appropriate for the parties to reconvene for a joint final session at the conclusion of the mediation. This generally only occurs when a settlement has been achieved, and when the parties decide that they wish to come together for the final session.

It is more often the case that, after the conclusion of the mediation, the mediator will confirm the outcome (whether the matter is resolved or not) to the parties, and will then close the mediation without a final joint session. The parties then leave.

Preparing for a mediation

Preparing yourself

For mediation to work, the parties in dispute must be willing to compromise to find a solution each party can live with. It is important before you attend to consider not only what you think you are entitled to, but also what you could live with as a compromise. This is not an easy or quick process. For example, if you need to remain connected with the other person (e.g. neighbours or family members) thinking about the future relationship is also important.

It is also helpful to consider what the most important issues are and what your personal objectives are. It may be appropriate to offer trade-offs, so considering this in advance rather than during the day of mediation is valuable. Mediation can be stressful, and the proposals raised by the other party may not be what you expected, so having a clear idea of what is most important to you is crucial.

Overall, it is important to come to the mediation with an open mind, willing to discuss the issues openly and explore different solutions that you may not have previously thought of. Mediation provides an opportunity for the parties to explore creative and flexible resolutions that a Court might not be able to award at the end of a hearing.

Considering the risks

You should also consider the cost of not coming to an agreement and resolving the matter at mediation. This may be a payment to the other person, legal costs (including potentially paying some of the other party’s costs if you lose or are not entirely successful at hearing), the risks of proceeding to hearing (including the uncertainty of whether the matter will go to a final hearing), ongoing stress or emotional impact while the dispute is unresolved, and the time and energy that is taken away from your business, friends or family while you deal with the dispute.

Obtaining necessary advice

Depending upon the type of dispute, it may be necessary and appropriate to get legal, accounting or financial advice before the mediation, even if you don’t think the possible outcomes will eventuate.

For example, if one possible solution is that a property may need to be sold, will it trigger capital gains or cause other tax consequences? Will receiving a cash settlement impact on pension entitlements? Will paying an amount require a bank loan? Will a bank lend you the money?

It is important for you to obtain this advice before agreeing to a settlement, as if you are bound to a settlement agreement but have not considered or been advised of the adverse impact that settlement may have on you and your financial position, you will have to live with the consequences.

Finalising the mediation

If the parties are able to resolve their dispute, they should write up the agreement confirming the terms and sign it.

Where a dispute is particularly complex, a document called a ‘heads of agreement’, which identifies the key points, is signed at the end of the mediation, with the parties completing a more formal document later. There are legal rules about whether such a document is immediately binding or not, so being aware of those rules beforehand is also important.

It is important that the parties clearly communicate when they consider themselves to have entered into a binding agreement, so that further arguments and disputes can be avoided. The mediator may be able to assist parties to decide the best way to document the agreement reached.

Next steps

To find a lawyer who can assist with your matter:

  • Online search: Find a law firm (select 'Mediation'* from 'Areas of practice')
  • Online search: Find a lawyer (select 'Mediation'* from 'Areas of practice')
  • Call the Law Society on 02 6274 0300 and we can put you in touch with a lawyer or a firm who can help you

* Please note that areas of practice are self-chosen by firms and practitioners and the ACT Law Society does not accredit specialists in any area of law.  

Related Links

You might be interested in these Articles

Webinars
Guidelines