Mediation
There is a story in yesterday’s Scotsman about the increase in mediation in Scotland. It is a profile on advocate John Sturrock QC and his mediation firm Core Solutions, which offers mediation services. One comparative aspect caught my eye:
He says the use of mediation in corporate and business matters has grown dramatically in Scotland in the past couple of years but believes there is “some catching up to do” when comparisons are made with the United States.
“Mediation should be about addressing issues up front, quickly, before they fester and become deep-seated”, Sturrock says. “The technique can reduce uncertainty, keep costs down and ensure that reputations are maintained.”
An initiative, launched this week by Core, aims to widen the role of alternate dispute resolution north of the Border.
Having participated in a few mediations, I wholeheartedly agree that they can greatly help with a wide variety of problems related to business disputes. My guess is, that if the US is more advanced than Scotland on this front, it is due in no small part to the generally more litigious culture on the western side of the Atlantic.
I don’t know the Scottish rules in this area, but some of the rules in Texas that help encourage mediation are:
- Courts can, and do, require mediation before cases can proceed to trial.
- Statements said during mediation are not admissible as evidence in court.
- Once an agreement has been reached, the agreement is enforceable in court.
I wonder if the relative lack of ADR in Scotland (assuming this is so) is in relation to legal policies or just general lack of knowledge (or some other reason)?
The costs of not doing some sort of ADR are quite high — the article mentions:
Research into the cost of disputes in business has found that the average bill for small companies is £75,000, with larger firms coughing up £500,000 or more. [ed note - looks like this is for all disputes]
The Gowers report in Recommendation 45 looks at this problem in the patent law context, and found that costs of patent disputes could be greatly reduced by the formation of a EU Patent Court:
Recommendation 45: Support the establishment of a single EU court to adjudicate cross-border IP disputes by promoting the European Patent Litigation Agreement.
Some numbers are in the report, if you are interested. I think that some sort of ADR should probably be built into the process of an EU-wide patent court (if needed), though I would be surprised if the big companies that get into these kind of large-scale patent disputes don’t already attempt mediation before bankrolling some Magic Circle firm’s increase in profits per partner for the year.
