Insurance Update: The Mediation Act 2017 - What You Need to Know
13 October 2017
The Mediation Act 2017 (the Act) includes many of the recommendations from the Law Reform Commission's 2010 report on Alternative Dispute Resolution: Mediation and Conciliation. Following this report, mediation legislation was contained within the 2011 Programme for Government. However, there was no further progress until September 2016 when a mediation bill was listed as priority legislation in this Government's legislative programme.
What is mediation?
Mediation is a voluntary process of dispute resolution whereby an independent third party assists the parties to the dispute to reach a settlement. It is considered a more positive form of conciliation in which the third party recommends solutions which both sides are free to accept or reject.
Key provisions of the Act
The mediation process: Part 2 of the Act deals with the mediation process in general. It sets out the key characteristics of a mediation process which include:
- the right of the parties to legal advice
- the right of the parties to cease the mediation process at any time
Obligations on legal advisers: Part 3 of the Act introduces an obligation on solicitors and barristers to advise their clients to consider using mediation as a means of resolving disputes. They must also provide their clients with details of mediation services and advise their client about the option of using mediation prior to issuing proceedings. A statutory declaration must be sworn by a solicitor as a means of proving that this requirement has been complied with. Solicitors’ obligations under this Act extend to in-house counsel, provided they are a practising solicitor on the roll of solicitors.
Involvement with the courts: Section 16 of the Act provides that a court may, on its own initiative or on the initiative of the parties, invite the parties to consider mediation as a means of resolving the dispute.
Section 18 of the Act sets out that the clock can be stopped on the limitation period specified under the Statute of Limitations when parties engage in mediation. In order for parties to rely on this provision and to effectively pause the limitation period, they will need to enter into an agreement to mediate containing the information set out in section 7 of the Act.
The agreement to mediate: The Act provides that the parties and the proposed mediator must prepare and sign a document known as an “agreement to mediate”. The agreement to mediate will set out the formalities of the mediation including the manner in which it will be conducted. It also contains details relating to fees and costs, place and time of the mediation, confidentiality and termination.
Other general points of the Act: While the Act applies to civil proceedings, it is important to bear in mind that it will not apply to:
- employment disputes
- taxation or Revenue matters
- judicial review proceedings
- other specified types of litigation set out in Section 3 of the Act.
Section 9 of the Act provides for the introduction of codes of practice for the conduct of mediation by mediators.
The Act also provides for the possible future establishment of a Mediation Council to oversee development of the sector in section 12.
The Act is an opportunity to encourage more businesses to consider using it as a tool for resolving commercial disputes. The proposed legislation should result in a practical reduction in both costs and resources in a wide variety of disputes. However, it remains to be seen how useful it will be in the context of personal injuries proceedings.
For more information on the Mediation Act 2017 and all other forms of alternative dispute resolution, please contact a member of our Insurance & Professional Risks team.
The content of this article is provided for information purposes only and does not constitute legal or other advice.