So, are commentators right to paint a gloomy outlook for mediation?
No. Evidence suggests that, although the mediation market – both users and providers – are taking stock after the rapid development of the last two years, the overall position of mediation is very healthy. What is perhaps missing are the design elements for the next phase of growth – more sophisticated products for a more sophisticated market.
It is important to remember that in the context of falling litigation, the actual ‘market share’ of cases going to mediation is still increasing. Since the introduction of the Civil Procedure Reforms in April 1999 there has been a drop of 37 percent in the number of cases filed in the Queen’s Bench Division.
An interesting figure in CEDR’s statistics is that the number of cases referred to mediation by the courts continues to rise. Last year 27 percent of mediations conducted by CEDR Solve, CEDR's dispute resolution and prevention service, were court referred, compared with 19 percent the year before and eight percent the year before that.
While judges and lawyers are increasingly recognising the suitability of mediation for cases that come before them, the government is also encouraging the use of mediation. In March this year the Lord Chancellor’s Department announced that all government departments would seek to avoid litigation by using mediation and other neutral-assisted dispute resolution procedures wherever possible.
And while this ‘top-down’ direction to use mediation is increasing, so is the ‘bottom-up’ demand from business. This year’s CEDR / Pinsent Curtis Biddle annual benchmark of business attitudes to mediation, carried out in conjunction with Legal Director magazine, shows a doubling in the number of businesses claiming mediation as their preferred method of resolving disputes with suppliers (24 percent from 12 percent last year).
The number of mediations referred to CEDR Solve through industry schemes or specific systems set up for individual organisations has also increased by 18 percent in the last year, accounting for 108 mediations in addition to the normal commercial caseload.
Too often mediation is viewed as a narrowly defined product, delivered in a typical format, over a typical period (one or two days), following a typical structure. There are some lawyers who view the current levelling of mediation numbers as a sign of declining interest in mediation. They are failing to notice that their clients are increasingly embracing the richness and possibilities of the whole mediation approach.
The mediation approach is about understanding why parties get into deadlock, understanding how they can be helped to move on, and creatively applying this understanding to a variety of situations.
The Financial Services Authority’s decision to offer mediation through CEDR Solve in regulatory enforcement proceedings is an important indicator of this development. Another example is CEDR Solve’s work with the Russian federal and regional authorities to devise a more effective system for the resolution of citizen’s claims against the State.
Mediation is becoming an important issue across Europe. The European Commission regards it as an increasingly important element in making the single market work.
October this year will see the publication of the Commission’s green paper on developing commercial mediation within the EU. The paper follows an extensive exercise carried out by CEDR and four other mediation bodies from France, The Netherlands, Italy and Brussels, researching the current state of mediation and other non-litigious dispute resolution procedures in the 15 member states and producing recommendations for future development.
Similarly, by next summer, the member states of the United Nations Commission on International Trade Law will (in all probability) have voted to adopt a model law of International Commercial Conciliation, encouraging those countries with no mediation provision to use it as a basis for reform. CEDR has been advising the Department of Trade and Industry on the UK’s stance in these negotiations.
Most lawyers have taken the mediation approach on board. No longer worrying that they are doing themselves out of work, they see it as an integral part of their overall offering to clients. In the last year over 1000 lawyers have gone through CEDR Solve’s training for lawyers wishing to better represent their clients in mediation.
It is not just lawyers who are becoming sophisticated mediation users. Business knowledge of mediation is rapidly increasing and still 32 percent of businesses in the survey wanted more information on mediation. Fifty four percent of those businesses surveyed said that their company would increase its use of mediation in the future.
Far from not making its mark, mediation has made a major impact. It will continue to grow as an integral part of the civil justice system and as a mainstream business technique for cutting the cost of conflict. The market may be drawing breath, but it is in readiness for the next challenges ahead.