Disputes are worrying, time consuming and a drain on financial and human resources. Most have no option but to turn to the courts or arbitration, incurring costs, delays and sometimes aggravating the situation. This is even more so in a country such as ours, where our typical Mediterranean character and a quasi-spiritual attachment to the idea that "I am right and you are wrong" make for an all-too-precipative resort to litigation.
Yet, there is now an alternative to litigation which is cheaper, faster, fair and effective: Alternative Dispute Resolution (ADR).
In its broader sense, the term ADR refers to an alternative to litigation and arbitration, which are both binding. In this context we refer to ADR mostly in the sense of mediation, which is non-binding on the parties unless and until a mutually acceptable agreement is reached and recorded in writing. There are also a number of other dispute resolution techniques, such as negotiation, conciliation, mini-trials and dispute management.
The origins of ADR can be traced to the United States in the 1970s, where it is currently widely employed, handling billions of dollars worth of disputes every year. Its use has now been successfully extended to Canada, Japan, Australia and, more recently, to the United Kingdom, in 1990. The rest of Europe are considering its promotion. Encouragingly, Malta is following suit.
Definitions
Let me just start by illustrating the more commonly used techniques in ADR:
Alternative Dispute Resolution - ADR
Any process that leads to the resolution of a dispute through the agreement of the parties without the use of a judge or arbitrator. It has also been referred to or described as 'dispute management' or 'conflict prevention'. It is essential to keep in mind that arbitration is not ADR; it is 'litigation'. An arbitrator's award is as binding as a court judgment. A mediator's "recommendation" is not. And I enclose the word in inverted commas because as a rule a mediator should strictly speaking avoid making recommendations, proposals or suggestions. However, should he choose to he must be extremely careful not to be misunderstood or misinterpreted thus losing the trust of one of the parties; and such should be made to one party alone in caucus.
Conciliation/facilitation
This features the intervention of an independent third party to bring the disputing parties together to talk.
Mediation
A voluntary private dispute resolution process in which a neutral person helps the parties to reach a negotiated settlement. The neutral third party would ordinarily play a more pro-active role than in conciliation. The mediator has no power to make any decision or award.
The mini-trial
A voluntary non-binding procedure allowing both parties to present their case before senior executives from each party. They would normally do so in the presence of a neutral 'expert' who would assist the parties to settle and who may, if necessary, give a legal or technical view of the merits of the case or likely litigation outcome. This procedure has been described as being 'structured to reconvert a legal dispute back into a business dispute'. Part of this procedure would be disclosure (i.e. exchange of documents and information). The neutral expert could also be a mediator.
Neutral evaluation
The use of a neutral to evaluate the facts and offer an opinion is designed to help the parties reach a settlement; even for one party.
Meetings support
The running and managing of a meeting by a neutral, without necessarily getting actively involved.
Dispute audits
Advice on the projected costs and parallel benefits of the use of ADR in a particular dispute.
Advantages of ADR
Some of the main advantages of ADR are:
It is 'user friendly', speedy and relatively inexpensive (when compared to court proceedings or to binding arbitrations), thus saving costs and time.
It can produce flexible and imaginative settlement agreements that a court or arbitrator does not have the power to order and the parties 'own' the resolution, unlike litigation or arbitration.
The whole process takes place on a 'without prejudice' basis, flexible, non-committal and non-binding, and suggestion that the matter is referred to ADR may not be perceived as a sign of weakness.
It can take place at any stage of a dispute, before or after court or arbitration proceedings are commenced, even during a lengthy trial or arbitration. Indeed, it may even come in handy when parties to a dispute realise that, a number of years down the line of a litigation process, it is more cost-effective to reach a settlement out of court.
It enables the parties to continue commercial relationships after dispute resolution, with such relationships even being strengthened, and avoids bitterness and division.
It mitigates the entrenched litigation culture and educates potential litigants.
The ADR process and results are confidential; proceedings are private and competitors and journalists are not present.
Mediation
The most popular form of ADR is mediation. ADR through mediation works by introducing an independent mediator (often called a 'neutral') to the dispute who will listen to and consider each party's case and outline documentary evidence. This takes place during a mediation session which usually lasts no more than one or two days. An average mediation lasts five hours.
During the course of the mediation, the mediator will also have a series of private sessions (known as caucuses) with each of the parties in turn (and in no particular order) to discuss their respective cases in more detail, the strengths and weaknesses of their cases, as they see them, and their objectives in resolving the dispute: certain information may be 'shuttled' by the mediator between the parties, but only to the extent that the mediator is so authorised. If no agreement can be reached at this stage, there may then follow a 'head to head' session when the parties meet in private.
In approximately 90 per cent of mediations worldwide, mutually agreeable terms are reached and recorded in writing, thereby rendering the accord between the parties binding. Up until this point the parties are able to 'walk away' from the mediation procedures. The mediator will be skilled in mediation techniques and will work hard during the course of the mediation in an attempt to facilitate a settlement. The parties agree in advance the identity of a suitable mediator from a wide panel of trained and accredited mediators made available to them.
Malta Scene
The sorry situation at the law courts is deeply entrenched. For the last 25 years or so one Justice Minister after another has introduced reforms in a bid to solve the backlog of cases. None so far have succeeded. However, we now have the introduction (albeit rather hastily) of mediation in the newly set up Family Court. With the shortcomings it may have, the mediation system must not only be given a chance to work, but must be encouraged and supported by lawyers, who should explain the benefits to their clients and make them feel at ease.
Like in any other reform, there are shortcomings in the regulations introducing family mediation, which I hope will be rectified without much delay and which I will highlight below. Furthermore, the system will be fine-tuned with practice and will serve as a pilot project for the spreading of mediation to other areas in the general civil and commercial sectors; a project which I know Government is already planning.
One thing that must be realised is that a mediator is not and cannot be a conciliator. He should not attempt to reconcile the parties and should he perceive that there is a chance of reconciliation then he must refer them to a professional conciliator of their choice. The role of the mediator must only come into play when there is no hope of reconciliation. The mediator must then help the parties reach a mutual agreement vis-à-vis division of communal property, maintenance, custody of children and so on.
The mediator is not there to solve the problems himself and, as indicated above, should ideally avoid making recommendations whether to the parties and, more so to the Court. It is not the role of a mediator to advise the judge.
The parties must reach their own agreement and it is not the mediator's role to vet separation agreements. He should just encourage the parties to take legal advice and any vetting should be done by the judge or a judicial assistant.
Evidence on oath should not form part of the mediation process and should not be considered by the mediator since it undermines the essential element of trust.
These are the principal areas where the regulations have gone wrong and need to be rectified.
In conclusion, on a general note, I will be proposing the way in which some success can be achieved: through ADR.
The number of judges and magistrates has been constantly increased and their task has been made more remuneratively attractive. We have had new halls, registries and offices. The case list has been fully computerised and staff have been trained. The 'master system' was introduced, which incorporates 'management conferences'. Yet the workload is so overwhelming that it has clogged up the whole system. Meanwhile, new cases keep flooding in.
It is clear that no form of structural or administratives change will solve the problem, at least alone. The only solution is a change of mentality, to educate people on the need to resort to resolution of disputes without litigation; that is to introduce the culture of ADR.
Litigation in Malta is too easy to commence and, at least until recently, too cheap to conduct. It should only be the last resort and, provided it is supplemented by a good system of legal aid, it should be expensive enough to deter. Unfortunately, though less so with time, many lawyers, if not actively encouraging litigation, are hardly doing enough to avoid precipitating matters into the long and winding court procedures. Not all judges make serious attempts to pressure parties to litigation to settle through negotiation.
The following measures should possibly be featured in a campaign to introduce ADR and to guide potential litigants towards it:
1. The appointment of more ombudsmen for specific areas where conflicts are common (e.g. health and housing) as we have recently had for the university.
2. Increased legal aid for non-capricious litigation.
3. Effective legal aid for those deserving cases which go to ADR.
4. Enforced pre-trial disclosure; exchange of documents and information, with any purportly undisclosed documents not being admissible as evidence during any eventual litigation.
5. Training for judges, lawyers and court staff in the skills of ADR, to be able to persuade parties to solve their dispute through ADR or, hopefully as a last resort, through arbitration.
Furthermore, the use of ADR should continue to be encouraged at every stage of trial proceedings. It will always save some time and money whenever it is used. There is no guarantee that the introduction of ADR will solve our problems at the law courts, but if it does not, nothing else will. Accordingly, I would propose that an ADR information and encouragement programme and a pilot scheme in the commercial and civil fields be launched officially by the government. Such a scheme, which compels parties to attempt ADR, has been successful in the Central London County Court.
Dr Sammut is an accredited mediator with the Centre for Effective Dispute Resolution based in London and joint managing director of MDM - Malta Dispute Management Ltd, a joint venture company formed between the law firms Ganado Sammut (of which he is managing partner) and Fenech & Fenech, incorporated with the object of promoting ADR in Malta and to provide dispute management services and facilities, including mediators.
MDM is associated with the de Bono Thinking Methods (Dr Edward de Bono being its chairman) and is a member of CEDR, the leading ADR service provider in the UK. MDM is supported by the Chamber of Commerce.