Late 2013, the International Commercial Mediation Working Group (ICMWG) made recommendations to the Singapore’s Ministry of Law (“Minlaw”) to “develop Singapore into a centre for international commercial mediation.” Minlaw welcomed the recommendations, which include enacting the Mediation Act and extending exemptions and incentives applicable to arbitration to mediation.
Over the years, mediation has gradually become an attractive option for companies in need of dispute settlement, conflict management and even conflict prevention. There are many reasons why mediation is preferred over litigation and arbitration.
First and foremost, mediation helps companies save time and money. It is not just about the money expended on legal fees for expensive adversarial proceedings. The opportunity costs incurred when companies devote human and monetary resources on going to court could well have been spent on their operations and even expansion. Complex litigation could take years while mediation could help parties reach an agreement much faster.
Even if a company were able to reach a favourable outcome by litigation, there is the issue of enforcing a judgment. It is noteworthy that there are few cases of parties reneging on the terms of their settlement, since they enter into the settlement agreement on a voluntary basis. This differs from arbitration, where parties are still adjudicated, albeit by an arbitrator.
Perhaps more critical for companies, is the fact that they will be able to walk out of the mediation chamber with their corporate reputations intact. The mediation process is confidential and conducted on a without prejudice basis. Whether companies reach an agreement at the mediation table or otherwise, there will be no negative impact on their commercial goodwill.
Mediation can be used in, amongst others, areas involving:
- Contractual disputes
- Employment disputes
- Shareholder disputes
- Partnership disputes
- Disputes involving companies and external parties or other companies
At MediationPLUS, we take on the role of an independent and neutral mediator to facilitate communication and help parties reach a mutually-acceptable solution.