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Founding Partner Saad Al Doseri examines the growing use of mediation to resolve disputes in the Arab region. Whilst mediation enjoys popularity in other jurisdictions globally, it is not yet widely used in the Middle East, although that interest is increasing. In his article below, Saad examines the merits of mediation, including the advantages of choosing it over other ADR methods such as arbitration, as well as how the concept of mediation aligns closely with Arab and Islamic cultural nuances.
An Arabic version of Saad’s article has been published in Al Ayam, a national newspaper in Bahrain. A link to Saad’s article as published in Al Ayam can be found here.
Mediation has become one of the alternative means for dispute resolution and has gained widespread popularity in several developed countries such as Australia, Hong Kong, and the United States of America. It is still in the introductory phase in our Arab region. As mentioned, it is an alternative means of dispute resolution, meaning an alternative to ordinary court litigation. Mediation shares with arbitration the reasons that led to its adoption, including:
- The slow litigation process in ordinary courts is burdened by the volume and complexity of cases due to the evolution of economic, financial, and investment relations and transactions and the introduction of many systems of commercial and specialized relations in general. Therefore, resolving such disputes takes a long time in ordinary courts, especially with the existence of two levels of litigation and the possibility of appeal, which does not conform with the speed required in such transactions.
- Avoiding the principle of public trials in ordinary courts to maintain the confidentiality of the dispute is considered one of the most important reasons for parties whose reputation and status are significant and trusted by their associates to protect trade and industrial secrets.
Mediation has advantages over arbitration for other important reasons that led to its adoption, such as:
- The desire of the disputing parties to maintain amicable relations between them.
- Avoid ordinary courts and arbitration due to the uncertainty of the final ruling.
- Avoid high court fees and arbitrator fees compared to relatively low mediation fees. Court fees and arbitrator fees are calculated based on the dispute’s value, while mediation fees are typically based on the time spent and the meeting venue cost.
- Ordinary courts and arbitration are bound to apply the law, whereas mediation applies what has been consensually agreed upon by the parties, which may not necessarily reflect the application of the law.
- Mediation meets the parties’ needs and goals, not the rights guaranteed to them in the contract or law. Needs and goals may exceed or fall short of rights.
After presenting the main reasons for resorting to mediation as an alternative means of dispute resolution, we can see the purpose and its main advantages, which are unavailable in arbitration or any other means. We will now address the concept of mediation in light of the above.
Concept of Mediation: Mediation means negotiations by a neutral and independent third party, the mediator, between two disputing parties to help them reach a joint decision to resolve the dispute. Unlike the arbitrator or judge, the mediator does not have the authority to impose a binding judgment on the parties.
Mediation is characterised as a purely voluntary system from beginning to end. Through the dynamics of negotiations, the mediator seeks to reach a solution that satisfies both parties as a prelude to ending the dispute. The mediator manages the meeting between the parties productively and effectively through specific skills to elicit the final and acceptable outcomes for them.
To achieve this, the mediator must gain the trust of all parties, maintain neutrality and independence, facilitate the exploration of all parties’ interests, and disclose any potential conflicts of interest or circumstances that might affect their impartiality. since trust in the mediator is the essential element for the success of negotiations and, thus, mediation, ultimately achieving the goal of resolving the dispute.
Mediation does not result in a binding judgment for the parties; rather, what they consensually agree upon is executed unless a written agreement is drafted and signed before a notary public and granted executory force. This means the obligations arising from mediation can be agreed to be enforced judicially in the enforcement court in the manner judgments are enforced if one party fails to fulfil its obligations.
An important fact must always be considered by the mediator from the beginning of the mediation process until its conclusion: the foundation of mediation is the consensual will of the parties to resolve their dispute through it. The parties’ combined will is the main driver that propels the mediation process. The mediator derives their confidence and position from this will to conduct and manage the mediation process positively.
Difference between Mediation and Arbitration: Arbitration is an agreement to submit a dispute to a specific person or persons to resolve it outside the competent court. Arbitration begins with an agreement between the parties to refer any dispute arising between them for resolution to an arbitrator or arbitration institution. Upon the occurrence of the dispute, the arbitrators are chosen in the manner agreed upon in the agreement. After the appointment, the parties meet with the arbitrators to sign the arbitration agreement, which defines the arbitrators’ jurisdiction, procedures, applicable law, arbitration duration, language, and other matters related to the dispute and procedures. Arbitration ends with a judgment that can be enforced, like court judgments, where the arbitrator(s) commit to the procedural rules applicable by agreement and the law. Parties can appeal the judgment for nullification even if they agree to consider it final if there are reasons for nullification.
In contrast, mediation consists of negotiations assisted by a third party who does not have the authority to issue a binding judgment for the parties but helps them reach a satisfactory solution and then conclude an agreement to settle the dispute, which is executed voluntarily between the parties. Negotiations do not necessarily end with an agreement to settle the dispute in mediation. The agreement can also be executed if the parties agree to grant it executory force as a documented instrument and enforce it through the enforcement court.
It is noteworthy that the mediator, like the arbitrator, does not require being a legal professional for expertise and qualifications, but knowledge of the law will undoubtedly give them an advantage and better understanding of the legal implications of the mediation process, enriching the mediation process and enlightening the parties.
However, the mediator must possess mediation skills and be able to manage the process sequentially and properly, as well as the ability to communicate positively with the parties.
Is it permissible to combine mediation and arbitration? Some may wonder about combining two alternative means of dispute resolution in one dispute. The answer is that there is no conflict between them and, more so, no conflict in combining mediation and ordinary courts.
Mediation is supposed to be the first means or step to resolve the dispute before resorting to courts or arbitration, avoiding high court fees and arbitrator fees compared to relatively low mediation fees, or preserving amicable relations and other reasons previously mentioned for resorting to mediation.
When mediation fails, the dispute resolution clause mentioned in the contract, which may refer the dispute to ordinary courts or arbitration depending on the parties’ agreement, is applied.
Therefore, in countries where the concept of mediation is widespread, a new clause is included under the dispute resolution section, mentioning mediation as the first means of dispute resolution. An agreement may also be reached on a specific mediator or institutional mediation, as is the case with arbitration. Mediation can also be agreed upon in a separate agreement if not in the contract.
Does the Arab community accept mediation? The Arab community is characterised by a deeply ingrained social nature among its members. The common factors in the Arab community, such as religion, lineage, customs, and traditions, have no equivalent in other communities, which may often be characterised by a degree of coldness and materialism in relationships among its members.
This particularity of the Arab community may act as either a positive or negative factor regarding the concept of mediation. This particularity, which sometimes includes inwardness and disdain for anything foreign, may prevent the adoption and spread of new concepts in the Arab community, especially if they appear to be Western in nature.
However, the essence of mediation is not foreign to the habits and customs of our simple Arab community. Mediation is applied spontaneously and informally at the family level, but not in the professional manner we are dealing with now. Disputes between spouses are often resolved through a mediator from the family. The same applies to conflicts within the family or tribe, with the eldest member resolving the issue.
Even if mediation in its current form is not applied in the Arab community, another method is applied to resolve disputes in the Arab community that is similar in concept to mediation or sometimes arbitration. What is used in the Arab community agrees with mediation in maintaining the confidentiality of disputes, such as between spouses or within the family or tribe, as maintaining a good reputation and amicable relations is the primary goal in our conservative society.
Our Arab cultural heritage is rich with models, whether in the Quran and Sunnah or in precedents that urge amicable resolution between disputants and avoid division and disagreement. These are the messages of prophets and messengers and the concerns carried by reformers throughout the ages.
Islam came with a culture of reconciliation and encouraged it, linking it with piety and making it a means of drawing closer to Allah. This is mentioned in many places in the Quran and Sunnah, such as Allah Almighty said: “The believers are but brothers, so make settlement between your brothers. And fear Allah that you may receive mercy.” (Quran 49:10) Allah Almighty said: “And do not make [your oath by] Allah an excuse against being righteous and fearing Allah and making peace among people. And Allah is Hearing and Knowing.” (Quran 2:224) The Prophet Muhammad (peace be upon him) said: “Shall I not tell you of a deed better than fasting, prayer, and charity?” They said: “Yes,” He said: “Reconciling between people.” (Narrated by Abu Dawood) The Prophet Muhammad (peace be upon him) said: “The son of Adam does not do anything better than prayer, reconciliation between people, and good character.” (Narrated by Al-Bukhari)
Our culture urges us to take a positive stance towards disputants by attempting to reconcile them. It is unacceptable for us to merely observe disputes. I am sure many of you have been in a similar situation, trying in your way to ease a conflict in your family or among friends and mitigate its intensity.
Therefore, we conclude that the culture of mediation, in its simple concept, is activated within social relationships in our Arab community and finds its basis in the Arab and Islamic cultural heritage. It remains active within the different relationships in society, such as commercial and labour relations. This requires more efforts to raise awareness.
It is premature to judge the extent to which our Arab community accepts the concept of mediation, especially in the scope of commercial relationships, as it is still in the introductory phase.
We all remember how much time we needed to accept the idea of arbitration, which resulted from workshops, seminars, and scientific sessions over the years. Accepting the concept of arbitration led to its adoption in most contracts, and the arbitration clause became one of the essential clauses in model commercial contracts. Accepting the idea of arbitration also resulted in its inclusion as a subject in the curricula of law faculties in most Arab countries, preparing the new generations to apply it.
Basic Stages of Mediation: The mediation process comprises five main stages that ensure both the mediator and the parties are prepared to begin the mediation process and apply it effectively to achieve its purpose. However, the primary burden falls on the mediator in all these stages. The mediator precedes the parties in reviewing all documents and understanding the claims and arguments of both parties, not to judge them but to understand the dispute and its background well, which will help suggest some proposals and understand the parties’ opinions that may arise during the mediation process. The mediator must communicate professionally and neutrally with the parties throughout the mediation stages and maintain their independent status and balanced positive interaction.
First: The Preparatory Stage: In this stage, the mediator meets with the parties separately or collectively, or even by phone, to gather as much information as possible and answer any questions the mediator may have after reviewing the documents. In this stage, procedural matters regarding the meeting schedule, timetable, and document exchange mechanism can be arranged.
Second: The Preliminary Stage: This stage begins with the commencement of mediation procedures, where the mediator meets with the parties, delivers the opening statement, and explains the mediation process, its stages, and the rules everyone must adhere to during mediation.
Third: The Mutual Understanding Stage: The mediator helps the parties understand the dispute issues better according to each party’s perspective. Each party is asked to clarify their viewpoint, and only the mediator can direct any clarifying questions to the speaking party. The purpose of this stage is to achieve mutual acknowledgement implicitly by the parties of the problem base presented by each party. Then, the parties can identify the issues they face, which may often differ from what is stated in the documents.
Fourth: The Negotiation Stage: This is the most critical stage in mediation, where the mediator uses their skills to help the parties determine and explore settlement options. The mediator should attempt to overcome any obstacle or deadlock one party may impose on another.
Fifth: The Agreement Stage: In this stage, the mediator summarises the offers made by each party to resolve the dispute and ensures that the agreement is written in the form of an agreement. The mediator may inquire from the parties whether anything has been overlooked. At this stage, it is not required to agree on all outstanding issues; it suffices to record what has been agreed upon and postpone unresolved issues to another meeting or in the near future as per the parties’ wishes.
Mediation Procedures:
- Generally, the procedures begin with the mediator inviting the parties to sit together at one table with the mediator, whether the mediation is at a mediation centre or with an independent mediator trusted by the disputing parties.
- The mediator opens the mediation procedures by reviewing the dispute between the parties and explaining each party’s perspective with complete neutrality. Depending on the nature of the dispute, the parties may attend personally or with representatives.
- The parties present their perspectives, and the mediator must allow each to explain their viewpoint, arguments, and reasons.
- Then, it is the mediator’s turn to negotiate using several criteria, the most important of which are:
- Clarifying to the parties the importance of cooperation and maintaining relations between them, as it is better than severing relations if the dispute continues, and the possibility that the parties may find themselves at a deadlock that will not benefit either of them.
- The mediator categorises contentious issues according to their importance, deduced from discussions with the parties and identifies matters that can be agreed upon, postponing addressing sensitive issues that may lead to alienation between the parties.
- Establishing and determining alternatives, even assuming that the parties wish to end the dispute, deciding on potential alternatives they can agree on is necessary. The mediator may have several ideas regarding other options. Still, they should wait until the parties make their suggestions since they naturally have more information that enables them to propose acceptable solutions. The mediator should avoid putting one party in a position where they must reject the mediator’s suggestions in the presence of the other party. It is better if the suggestions come from the parties themselves, so if rejected by the other party, the mediator can intervene to calm the situation and offer other suggestions considering both parties’ viewpoints and potential concession limits.
- What the mediator sees fit to follow to prevent reaching a deadlock: Here, the mediator should assume the role of an empathic listener for each party and then transition to the role of an agent of reality, advising the parties that a solution will not be possible without considering the issue flexibly and being ready for some concessions by both parties.
- Subsequently, meetings occur between the mediator and each party separately, known as caucuses, where the mediator meets individually with each party to reduce emotional intensity, build trust between the parties, propose alternatives to reach a realistic outcome consistent with both parties’ interests, maintain their relationship, and avoid boundaries that lead to anger and conflict.
- The mediator must maintain strict confidentiality of all information disclosed during individual meetings (caucuses) and must obtain explicit permission from a party before sharing any information from these private sessions with the other party. During this time, the mediator must maintain trust with each party separately to reach an agreement with them.
The Agreement: The mediator identifies the points on which the parties can agree to move to the agreement stage, where the proposed settlement agreement is prepared and reviewed with the parties or their representatives, and amendments are made until the final form is agreed upon. If signed, the agreement is implemented consensually between the parties. The agreement may include a clause stating that it is given executory force, meaning it can be executed directly before the enforcement court like judgments issued by courts after being stamped with executory force and entered into the enforcement court for execution as a judgment in case the parties do not voluntarily execute it.
Can Mediation Be a Means to Resolve Disputes? Mediation is effective, quick, and reasonably priced compared to ordinary litigation or arbitration procedures. In the state of New York, small cases related to car insurance accidents are referred to mediation, where they are resolved quickly away from ordinary litigation procedures. Claims are settled through mediation, and the agreement is executed immediately.
Some Reservations from Practitioners: Based on practical experiences in our region, the concept of mediation as an alternative means to resolve disputes still needs support to clarify its concept and its advantages that are not available in arbitration and ordinary courts.
Conclusion: For mediation to take its role as a tool for resolving disputes, individuals must be convinced of it as an effective means of dispute resolution. On the other hand, it must be legally protected by the legislator in any legal system. Mediation also needs legal media promotion by economic, commercial, and official circles. Mediation can play a role in saving time and money when resolving disputes. Naturally, it requires qualified individuals with a good reputation, knowledge of dialogue management, legal background, and, most importantly, being trusted by the parties.
The legislator in the Kingdom of Bahrain intervened through Decree-Law No. 22 of 2019 regarding mediation for dispute resolution to regulate mediation provisions, granting legitimacy to mediation procedures, and setting the guidelines for mediators and parties regarding mediation procedures and mediator work rules. It covers areas of concern for practitioners, including mediator obligations, work conditions, confidentiality maintenance, and granting enforceable authority to agreements reached with the mediator’s help, resulting in the agreement being executed in the manner court judgments are executed.