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Mediation clauses in commercial agreements imply that businesses seek an outcome that enables them to continue their relationship once a dispute is settled, and which enables them to retain control of the negotiation process, says John O’Leary of Walkers Attorneys’ mediation division.
Many organisations include mediation provisions in their business contracts to oblige signatories to take this route before contemplating the more adversarial options of arbitration or court action.
Off the record, mediated dialogue facilitates easier acceptance of others’ considerations and needs and therefore more scope for finding creative proposals for settlement.
For example, says O’Leary, a business owned by two brothers used mediation to resolve complex financial and personal issues which arose when they wanted to retire and hand over the business to their sons.
The problem was that the four individuals involved had very different ideas about what would be a fair allocation of the shares in the business. The sons felt the fathers should retire completely and have no interest in the business, and three of the four believed that the sons should not share equally in the business.
After two mediation sessions proposals were formulated which resulted in a settlement of the disputes without acrimony to the satisfaction of everyone.
Mediations in commercial disputes usually involve lawyers being present and involved throughout the process. These mediations are usually arranged for a full day so that the parties can set aside sufficient time to attempt to resolve the issues with the assistance of an impartial mediator.
Such a process also provides for regular caucus sessions. It is necessary for parties to be sure that they have proper authority to enter into agreements on behalf of their principles, adds O’Leary.
An advantage of commercial mediation is that the parties can design a flexible process together with the mediator and this is particularly important where the parties have a continuing relationship beyond the immediate dispute.
Walkers is ideally placed to provide commercial mediation services. O’Leary and fellow Walkers attorney Kamlesh Ker are accredited commercial mediators, having been trained by UK-based and internationally recognised mediation organisations such as the Alternate Dispute Resolution group (ADRg) and the Centre for Effective Dispute Resolution (CEDR).
They are panelists for both the Africa Centre for Dispute Settlement (ACDS) based at the University of Stellenbosch business school and TOKISO Commercial Dispute Settlement, based in Johannesburg.
Both attorneys are also experienced trainers and offer training in dispute resolution methods for companies to equip their management to effectively deal with internal conflicts.
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