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Mediation is a process by which parties who have a dispute engage a neutral, called a mediator, to facilitate a resolution to their problem. Although some mediations are mandatory, arising from an agreement or a court ordered process as is beginning to happen in family matters, but most are by agreement between the disputing parties.

The mediator is a facilitator, not a decision maker. The proceedings, usually lasting less than one day, are entirely confidential and the parties normally agree in writing with the mediator that no part of the proceedings can be introduced as evidence in a court of law.

If the parties do come to an agreement, the mediator ordinarily prepares a brief written summary of the results of the process which is signed by all parties. This document, along with the agreement to mediate, are admissible in court proceedings as evidence of agreement between the parties.

Mediation is a powerful dispute resolution tool, particularly useful when the parties have a continuing relationship that will survive the solution to the dispute. They are commonly used in labour and matrimonial disputes. The advantages to mediation are: relatively low cost, privacy, and most importantly, the fact that the parties themselves arrive at their own solution creating a greater probability of a "win-win" result. There are no obligations arising from the mediation until or unless an agreement is reached: either party or the mediator can terminate the proceedings at any time and without giving any reason. This non-binding facility can and should create a more relaxed atmosphere in which the mediator and the parties discuss not only their respective needs, but make a genuine effort to understand the interests of the other side.

The typical mediation process is as follows:

  • The mediator is selected either by agreement or by reference from the British Columbia Arbitration and Mediation Institute (BCAMI) or the British Columbia International Commercial Arbitration Centre (BCICAC);
  • The appointed mediator contacts the parties or their counsel, usually by conference call, and sets the time, place and the parameters of the mediation agreement;
  • The mediator prepares an agreement which is signed by the mediator and the parties;
  • At the commencement of the mediation, each party sets out his or her issues and, perhaps, expected resolution in an informal unstructured way;
  • Each party questions the submission of the other side, ideally with minimal intervention by legal counsel;
  • The mediator then meets individually with the respective parties encouraging them to understand and react to the other side's needs and interests;
  • If the mediator considers that an agreement is reached, the parties and the mediator then reconvene and the agreement is committed to writing - ordinarily one to two pages in length, setting out the obligations in generalized, but binding form.
The disadvantage of mediation occurs when the parties are not both prepared to settle their dispute through the mediation process or when one side uses the process as a tactic to delay litigation or arbitration. A third disadvantage can occur at the hands of inexperienced mediators who are either excessively intrusive or who are unable to maintain the necessary neutral stance or to control the process.

Clayton is a past president of the British Columbia Arbitration and Mediation Institute (BCAMI) and has conducted several mediations in the shareholder dispute arena, generally where valuation issues are relevant.
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