Alternative Dispute Resolution and the Irish Commercial Court.

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An article in the current issue of the Arbitration and ADR review, Alternative Dispute Resolution and the Commercial Court, written by the judge in charge of the list, Mr. Justice Peter Kelly, gives an interesting insight into the history, role and effectiveness of mediation in the Commercial Court. When the court was first established over six years ago, the rules provided that the proceedings could be adjourned for 28 days to allow the parties engage in the process of mediation, conciliation or arbitration. It appears that mediation has been the most utilised and popular ADR process to date.

We learn from Mr. Justice Peter Kelly that the wording for the rules was chosen carefully, after considerable consultation and principally with judges and practitioners in the Commercial Court in Belfast, London and Edinburgh. The Commercial Court in London has been in existence for well over 100 years. The judges and practitioners in these jurisdictions were all agreed on the importance of the voluntary nature of the alternate dispute resolution process, that you cannot force litigants to go to mediation and if you do, it may not achieve the desired result.

Six years on, every practitioner in the Commercial Court now knows how the rules operate and in all likelihood on the application to have the matter entered into the list or at the next directions hearing, the court will be informed that the parties have agreed to engage in mediation. The court will then want to know the name of the mediator and the date of the mediation.

The Question of When to Refer to Mediation?

Judge Kelly writes that there is no hard and fast rule here but his experience over the last six years in the Commercial Court seems to indicate that the parties stand a better chance of a successful mediation if the referral takes place subsequent to the delivery of pleadings and before discovery of documents. In disputes involving family members, that might be a typical Section 205 application under the companies acts, Judge Kelly has found that the earlier the parties are sent to mediation the better.

On The Standard of Mediators

Mr. Justice Kelly notes that the standard is very good, but highlights two particular problems. One, “in some cases persons are being chosen as mediators who had no formal training in the art. They do not have an appreciation of what mediation is about. Very often they do more harm than good and just add an additional layer of costs because the mediation will not be successful. These cases are becoming fewer because practitioners appreciate that if the mediation is to be successful, a trained and preferably an experienced mediator is much more likely to achieve success than one who is not.”

The other problem that arises is that some mediators have become very popular, their services are in demand and they may not be able to facilitate the parties. However, on certain occasions when this arose, the Commercial Court was in a position to offer a trial of the action faster than the mediator could arrange the mediation.

Recent Cases Involving Mediation in the Commercial Court

In 2009, there was a substantial increase in the number of cases seeking entry into the commercial list, 373 and the average time between entry into the list and the conclusion of the action is 21 weeks. According to Commercial Court statistics, 25% of cases are concluded in less than four weeks with 50% of cases finishing in less than 15 weeks and 75% of cases are brought to an end in less than 32 weeks. 90% of commercial Court cases are concluded in less than 50 weeks.

The Commercial Court statistics contrast sharply with the courts in India, where it will be 2330 by the time Indian courts, working at their current pace, clear the extreme backlog of cases that exists today. This interesting observation was made by Indian Justice V.V. Rao in an address on E-Governance to the judges there. Mr. Justice Rao painted a very bleak picture going forward and said the system must change if they are to reduce the backlog within the next 320 years. The judges in India have been encouraging litigants to look towards alternative dispute resolution but progress has been slow.

Mr. Justice Rao said that the average caseload for each judge is in or around 2,145 cases and given the amount of cases settled through mediation in Bangalore and Delhi alone, this would relieve eight judges of all the cases in their hands right now. This is just the start in the relief that mediation can allow for the justice system. The next step is to take mediation to the district levels in each state, which will hopefully further reduce the backlog of 320 years.

The first case in the Irish Commercial Court involving mediation was in 2005, it concerned a commercial property dispute which had been long-running and bitter. It was brought to an end within three weeks of being referred to mediation. mediation costs uk

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