Getting your project back on track - early mediation?

As business starts to move out of COVID-19 lockdown, we must work out how to get projects and deals restarted quickly, particularly if affected by force majeure or other changes in circumstances.

How can mediators help?

The flexible and facilitative skills of a mediator mean that they can assist with resolution of issues or an impasse in various ways; they are not just part of formal, litigated dispute resolution. In fact, the mediation process arose in the first place because commercial people wanted commercial solutions, without the cost, time and lack of control inherent in formal court proceedings.

Negotiation between the parties will be enhanced by the addition of the independent, neutral lens of the mediator. A faster and “best for project” outcome is more likely to be delivered. There is no reason to wait until negotiations between the parties have broken down before engaging a mediator.

Time is money!

’Best for the project‘, an expression increasingly written in to decision-making protocols of project documents, makes a fine ideal, if it actually works in practice. When contracts are signed there is of course, alignment of interest and, it’s trite to say, what’s "best for project" is best for the parties. When alignment is challenged by external forces, however, there is no longer any necessary correlation between ‘best for project’ and ‘best for (all of) the parties’.

Mediation assists identification of the course that is truly best for project and provides a path to quickly and efficiently restore alignment of interest.

Mediators can offer things even the best commercial negotiators cannot do alone.

The first is neutrality. With no stake in the outcome, mediators don’t have the commercial or emotional baggage parties often carry. Without any obligation to act in the best interests of one party, a mediator brings a freedom not permitted to the legal representatives of a party.

The second is the ability to see both sides. The mediation process allows mediators to hear and understand both sides and to facilitate discussion in joint session between the parties. The process also gives the mediator the luxury of private meetings with each side, to better understand interests, challenge positions and explore solutions.

The ability of the mediator to act as a confidential yet independent participant and to talk frankly with each party privately as well as together, is the biggest single differentiator of mediation from negotiation. Commercial negotiations often seek openness by, for example, invoking the cover of “without prejudice”. This might be legally attractive but often inhibits outcomes – what’s said can’t be unsaid. In a tense environment “without prejudice” may not actually contribute to a true and transparent exploration of options.

Mediation allows its participants to be guided to their own tailor-made resolution. This fact brings mediation closer to commercial negotiation and distinguishes it from any form of “imposed” resolution, whether through the courts, arbitration or expert determination.

A mediator with significant commercial and project experience has the necessary tools to help parties discover options and to assess the strengths and weaknesses of each. While the mediator assists the pathway of negotiation, the outcome is ’owned’ by the participants.

I am not suggesting that mediation is an alternative to bilateral negotiation between willing parties. Traditional negotiation may, of course, get to the same or similar outcome eventually. I am suggesting that early engagement of a mediator is a modest step offering better prospect of a speedy and best for project outcome.

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