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A QUICK FIX?

LEGAL

The legal section of a daily broadsheet recently ran a feature on mediation under the headline 'ADR = A Drop in Revenue', writes Kim Franklin.

It is true that a successful mediation tends to bring a full-blown dispute to an abrupt and satisfactory conclusion, instantly depriving the parties' representatives - their experts and consultants - of all that lovely fee income. But any conclusive form of dispute resolution has the same effect, whether it is settlement before trial or judgment afterwards.

The objective of any formal dispute resolution procedure is? er? to resolve disputes. The time and resources required to do so are defined by the complexity of the subject matter. A definitive ruling on complex disputes cannot be made without gathering and testing the evidence relied upon by both parties. Assimilating extensive documentary, factual and opinion evidence is timeconsuming and costly; testing it, by cross examination even more so. When it works, the parties are provided with 'Rolls-Royce' justice - priced accordingly.

In this context ADR (alternative dispute resolution) can been seen as less of a RollsRoyce and more of a Mini - it's quicker and cheaper - but not the definitive driving experience.

When deciding which to opt for, the parties do not necessarily face the stark choice between a Ferrari and a Ford Focus. It is more of a sliding scale depending upon what type of result the parties are prepared to accept.

The original intention of adjudication was that it should be at the economy end of the market - quick, cheap and not even conclusive. Five years down the line it has developed into an increasingly expensive and unreliable model.

Now that other forms of ADR - such as early neutral evaluation and expert determination - have a few miles under their belt, it is clear that the quality of the result is compromised if the neutral evaluator carries out the evaluation too early, before the dispute is clearly defined or the expert makes a determination on insuffi cient evidence.

This point was emphasised in the case of The Wethered Estate v Davis (judgment 15.07.05). The dispute concerned the occupation by the defendant of the claimant's land. At the conclusion of lengthy proceedings, the judge found substantially in favour of the claimant. The defendant argued against paying the claimant's costs because it had delayed in agreeing to mediation.

The claimant's stance was that it was willing to mediate in principle but contended that for mediation to have the best chance of success the parties should have a full understanding of their respective cases.

As the dispute involved the interpretation of an agreement against a factual matrix of disputed facts, the judge found that the defendant's case was not easy to fathom and needed to be explained before the commencement of mediation.

He concluded that it was not unreasonable to delay mediation until the true nature of the dispute was defined.

In the circumstances the claimant was not penalised for refusing the Mini option.

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