What is Mediation?

Mediation is a voluntary dispute resolution procedure. The purpose of mediation is to bring the parties to the end of the conflict between them through agreement, and in a peaceful and efficient manner, while saving resources and without requiring a forced decision by a court of law. As part of the mediation process, a neutral mediator works to bring the litigants to mutual listening and cooperation between them in order to formulate an arrangement that will end the dispute.

Mediation is commonly used in commercial and civil disputes (interpersonal relationships between man and man), divorce, employer-employee relationships, where a criminal offense has been committed (between a victim and an attacker), administrative matters (between a citizen and an authority), in class actions and even in tax disputes.

Mediation is also common in legal proceedings in the courts. According to the Civil Procedure Regulations, there is an obligation to hold a Coordination Meeting (Information, Familiarization and Coordination) with a mediator, in order to examine the possibility of referring the dispute to mediation.

The judge is also authorized, at any time, to suggest, to the parties, to refer the lawsuit to mediation (with the consent of the parties), so as to avoid lengthy and expensive legal proceedings for the purpose of a judicial decision. Similar to the court which strives to bring the parties to a settlement by means of mediation between their positions, it is possible to arrive at mediation by way of arbitration proceedings, with the consent of the parties.

In the mediation process, the parties to the dispute are not bound by the rules of civil procedure, the rules of evidence or the legal norms that are used in legal litigation. Instead, the parties agree on how to settle the dispute, both procedurally (the very agreement to mediation) and substantively (the agreed upon resolution of the dispute).

In so doing, the parties are free to choose the identity of the mediator who will mediate between them. It is no wonder that the consensual result is more effective than a forced decision, because the parties will respect a result reached of their own free will.

The basis of mediation is the dialogue between the parties, which is intended to resolve the dispute by agreement and independently. Mediation does not necessarily strive for legal truth in the form of rights and obligations, but for making peace between the parties based on agreement, which also involves compromise.

Unlike the legal and confrontational discourse that is characteristic of litigation, mediation strengthens communication and understanding between the conflicting parties through dialogue, human empathy, and tolerance towards the other party, it rebuilds the trust between them, improves their ability to solve future problems without the need for an external legal authority, sometimes with the possibility and desire to strengthen the ties between the parties in the future as well.

Advantages of the mediation process

Mediation is preferable to a forced decision, both for reasons of efficiency and quality of dispute resolution and because of the parties’ control over the mediation process and its outcome, while saving the parties costs and time. Mediation achieves a better quality result for the parties, because they accept the solution of their own free will and take responsibility for it.

Moreover, in a mediation procedure, the parties can reach a more just and creative result than in a formal coercive procedure, especially in an ongoing relationship (for example, a dispute between neighbors or a divorce). Parties to a mediation process strive and can attain a result that is better for them than any judicial decision, in terms of win-win.

At the very least, even if the mediation is not completely successful, this does not detract from the validity of a partial mediation arrangement that specifies the principles agreed upon by the parties in general terms, as a sort of memorandum of understanding.

If this is not enough, mediation relieves the parties of the mental anguish of conducting legal proceedings, including giving testimony in court and the expenses involved in conducting the proceedings (for example, the court fee when filing the action and attorney fees), regardless of the outcome. Unlike legal litigation, in mediation a solution can be reached in one or a few meetings.

The mediation process has the potential to be of important social and personal value to the parties to the conflict in the immediate term – improving the results of the negotiations by creating solutions based on needs by “enlarging the pie”, as opposed to dividing it, while improving relations between the parties.

In the medium and long term – empowering the parties by providing education and a growth experience, including self-esteem and self-confidence. Empowerment means giving the parties a sense of value and the ability to make decisions and deal with life’s problems.

Education means raising people to a level of understanding or empathy for the situation and the perceptions of the other party. When these two processes are central processes in mediation, they help the parties to transform the interaction of the conflict between them from destructive to constructive.

What is the role of the mediator?

In the mediation process, a neutral third party helps the conflicting parties to conduct uninhibited negotiations to reach a settlement. The mediator does not necessarily require a legal education. Sometimes the mediator may have a different academic education.

As a general rule, in order to appear on the list of mediators of the courts, the mediator must have an academic degree with experience in his field, he is required undergo at least 60 hours of mediation training and have experience in conducting the mediation process. In order to become a mediator in family matters, additional training of at least 40 hours in mediation is necessary in the field of family law.

Parties, who wish to conduct a mediation procedure at the Israeli Institute of Commercial Arbitration, apply to the Institute and receive a list from the Institute of three mediators with experience and expertise in the field of the conflict between the parties. The list may include retired judges, leading lawyers or excellent mediators from different academic worlds. The parties are entitled to choose the mediator who best suits them.

The mediator clarifies the issues in dispute, removes communication barriers, provides the parties with tools for discussion and he offers possible solutions. He is required to help the party having difficulty making decisions, in order to ensure the realization of his wishes within the framework of mediation. Therefore, the mediator is not authorized to settle the dispute, and he must respect the voluntary and conscious freedom of choice of the parties.

The mediator is subject to ethics rules, which oblige him to fulfill his role fairly and impartially. The mediator is required to be neutral in relation to the conflict and he must treat the parties equally.

A mediator who is not neutral will have difficulty gaining the trust of the parties, and as a result the discriminated party will refuse to compromise, or to disclose essential information and cooperate, to the point of thwarting the mediation.

Who else is involved in the mediation process?

Parties to the mediation can be assisted by their lawyers who will participate in the mediation meetings, in view of their right to be represented by a lawyer, and in view of the fact that the mediator is not authorized to give legal advice. The participation of lawyers in the procedure may, ostensibly, push the parties to reach an agreement, because they can assess the legal prospects and convey this to the parties.

Moreover, the presence of lawyers is important in a situation of power differences between the parties. Therefore, in most cases, it is desirable that the mediation agreement be signed after receiving legal advice, so that the parties will reach agreement regarding the content of the mediation agreement.

Nevertheless, this may not necessarily lead the parties through a social process of reconciliation. In mediation, the parties should be at the center of the process, as active partners, and not their lawyers. The very participation of lawyers in the mediation process makes the hearing formal and confrontational, as is customary in litigation.

It is for good reason that the chances that the mediation will end in an agreement increase dramatically when the parties conduct the negotiations themselves, without the assistance of lawyers.

Signing an agreement at the end of the process

The parties to mediation control its outcome, so they cannot be forced to sign a mediation agreement. However, in the event that the parties conclude an agreement in the mediation, it is up to them to file it to a court so that it will assume the validity of a judgment. Confirmation of the mediation agreement is important in terms of its binding effect, because giving it the effect of a judgment enables it to be enforced by the Execution Office, without instituting further proceedings.

To this end, the consent of all parties to the mediation agreement must be obtained, because validating the consent is an integral part of the mediation process and is the core of the process.

Confirmation of the agreement reinforces the finality of the settlement agreement as an arrangement that ends the conflict between the parties, because the court usually does not intervene in mediation agreements, as a matter of policy, in order to fully fulfill its contractual intention.

Even on the assumption that a flaw occurred when signing the mediation agreement, including duress, coercion, error or deception, the court exercises extreme caution regarding intervention, and it will only do so if there are substantial reasons that justify its cancellation.

The court will reject the arguments of a party to a mediation agreement, the main point of which is the viability of the mediation agreement for him in retrospect, given the need for finality and certainty which constitute the basis for ending a legal dispute.

Confidentiality of the mediation process

The mediation process is a confidential procedure within the framework of which facts that are provided during the procedure may not be used as evidence in civil proceedings in court. This is in order to maintain the effectiveness of the communications and uninhibited negotiations between the parties.

If confidentiality did not exist, parties to mediation would fear that representations, statements and waivers would work against them in the courts or in arbitration, if the mediation process failed to bear fruit.

Moreover, given the duty of confidentiality imposed on the mediator, the mediator may not testify against any of the parties in subsequent legal proceedings.

Conducting a mediation process concurrently with legal proceedings

Where a serious and bona fide mediation process is being conducted at the same time as hearing the lawsuit, it is appropriate to delay the arbitration or court proceedings, because the rivalry in the legal proceedings may thwart the mediation. Moreover, there is no point in conducting two parallel procedures for the resolution of the conflict, thereby increasing the costs involved.

What is Med-Arb?

Med-Arb is a process that combines mediation with arbitration and enjoys the advantages that each procedure has to offer the parties.

As a general rule, it is preferable to begin the resolution of conflict in a way that connects the parties, to allow the parties to reach understandings and perhaps even agreements through mediation. If they succeed in mediation – that’s good: there is an agreement and the case is closed to everyone’s satisfaction.

But what happens if they fail? In the event that they fail to agree on all the matters in dispute – the mediator has no authority to decide. The result is that the mediation process is stopped and the parties begin conducting the conflict again, and this time in court.

The Med-Arb process allows for another path for resolving the conflict: In the event that the mediation does not go well – the procedure is not terminated, but it changes course and the parties move from mediation to arbitration.

The advantage is clear: the parties begin nicely, with mediation, they lower the flames and discuss the matter constructively. If they succeed – that’s good. If not: the case goes to an arbitrator who decides on the issues that remain to be decided.

As part of a Med-Arb process – at a Commercial Arbitration Institute – the parties can enjoy both worlds: on the one hand, the parties can conduct uninhibited negotiations with the genuine and sincere intention of reaching an agreement to end the conflict. As part of the negotiations, they can open up and make disclosures to the mediator.

The mediator is authorized to meet with each party separately, and the parties know that everything said to the mediator will not be used as evidence in court. If the negotiations are successful – an agreement is signed between the parties and it can be said that the mediation process was completed successfully.

However, in the event that the parties fail to reach an agreement – the mediator terminates his duties and another arbitrator is appointed instead of him, in order to bring the conflict to an end by deciding the issues that remain open.

Why mediation at the Commercial Arbitration Institute?

The Israeli Institute of Commercial Arbitration has a long and impressive list of experienced mediators in various fields of interest. In order to have a mediation process that is professional and of the highest quality, the parties are offered three mediators to choose from, each of whom is an expert on the subject matter of the dispute.

The Arbitration Institute’s staff coordinates and oversees the mediation procedure, placing special emphasis on having a dignified, fair procedure, while striving to reach agreements in good spirits and in the shortest possible time.

The Commercial Arbitration Institute has extremely high success rates in mediation procedures that have been conducted at the Institute, including in complex and intricate disputes.