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What is mediation?
Mediation is a modern method of resolving
conflicts out of court under the direction of a neutral third party,
the mediator. Mediation is a flexible, discreet process in which the
parties jointly work out an agreement through structured negotiations.
The mediator is not a judge, but rather an intermediary who guides
the parties through the process.
The main difference between mediation and court proceedings is that
in mediation, a third party does not decide; rather, the parties seek
on their own authority a solution which is in keeping with their interests.
The parties retain power of decision; they decide on the progress
and outcome of the process.
The goal of the process is a legally binding agreement settling the
conflict out of court.
In the United States, mediation has long been commonplace. In Germany
too, mediation is gaining increasing importance in areas beyond the
well-established family mediation, particularly in business law.
Mediation - the right way?
Mediation is the right way if
- speedy and inexpensive conflict resolution is sought
- relationships of long standing are not to be destroyed
- total discretion is important
- further escalation of the existing conflict situation is to be avoided
- control over the negotiations and their results is desired
- forward-looking solutions benefiting all sides are sought
Mediation in business
In the business world, mediation is particularly suitable for
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conflicts
in long-standing business relationships, particularly with customers
or suppliers |
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long-term agreements, e.g., those
related to software use, plant construction and building |
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complex disputes between companies |
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conflicts in which only a speedy
solution can avoid larger damage |
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disputes between companies and consumers |
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shareholder conflicts |
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regulation of corporate succession |
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conflicts in family businesses |
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internal conflicts, e.g., between
employees or departments or between employer and employee or employer
and works council |
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inheritance disputes |
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processes of integration following
corporate acquisitions |
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environmental
procedures. |
Mediation: the process
Mediation follows no set course, as the parties may to a great
degree determine progress themselves. However, five phases may be
distinguished:
Phase I
Initial phase
In the "opening statement," the mediator explains to the parties (and
their attorneys, if any) the features of the process. The rules are
discussed and decided on. A mediation agreement is concluded, which
regulates (e.g.) the neutrality of the mediator, costs and the distribution
of costs, the confidentiality obligation and constraints on the statute
of limitations.
Phase II
Presentation of the conflict
The parties give their view of
the conflict. Topics to be dealt with and contested and uncontested
issues are brought out. The mediator provides a summary and develops
plans for the next steps together with the parties.
Phase III
Disclosure of interests
The mediator has the parties present
their own business and personal interests, with the result that the
motives of those involved are recognized and, ideally, mutually understood.
Phase IV
Search for options
Here the development of a solution is foregrounded. The parties jointly
work out and evaluate various possible solutions. The goal is a result
from which all parties will profit.
Phase V
Conclusion of an agreement
The mediation concludes with a precise
formulation of the agreement and its legal structure.
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