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Mediation is not to be confused with meditation. Meditation is about going 'ommm...' and generally relaxing. Whereas mediation is a way to resolve conflict.
The rough set-up is that the two parties contact a mediator who then channels a discussion between the parties which is aimed at defining the sources of the conflict and getting rid of them1. The main difference between mediation and a 'proper' law suit is that the mediator has, by definition, no power over the parties. He or she cannot force a decision on them. Mediation is part of the growing Alternative Dispute Resolution (ADR) idea which includes means like conciliation or evaluation.
The roots go back to the 1970s and it's been spreading ever since throughout the common law world2. The civil law countries have been a 'little' slower to implement mediation. For example, over in Germany the first seminar at university on the subject was held in Hanover in 1998. As a comparison: four years earlier a third of the Australian universities offered these courses. Processes similar to mediation have been known in China for roughly 2,000 years.
Together with the growth of demand and supply, the number of 'flavours' mediation comes in has increased. It has developed into many different and overlapping categories such as:
- evaluative mediation
- transformative mediation
- directive mediation
- therapeutic mediation
- expert mediation
- shuttle mediation
- community mediation
- facilitative mediation
As mediation is usually not controlled by the government there is neither a set code on conduct, rules, definitions, fees or training of mediators. All these depend on the organisation the mediator is affiliated to, if any.
Apart from 'private' mediation3 there is a 'court annexed' mediation. As the term suggests it's about mediation connected to a law suit. It is usually part of a 'caseflow management system' which is intended to get cases through court more quickly. Without going into any detail, it works by telling the parties and their lawyers what to do and keeping a close eye on what they do and makes sure they do it quickly and efficiently4.
The problem with court annexed mediation, as some argue, is that mediation is all about the free will of the people concerned to solve their conflicts. Mediation which is forced on them, to a greater or lesser extent, would destroy this basis. Also mandatory mediation as part of every law suit in all or certain fields would degrade mediation to a step which parties had to get behind themselves in order to proceed to trial and by this diminish the chances of settlement by mediation. Although these seem strong arguments statistics reveal that the chances and 'quality' of the solution is not really decreased by court annexed mediation. But then again you should not trust any statistics you didn't fake yourself.
One advantage of mediation is that it is cheap and fast. The fact that it is affordable makes it interesting for disputes about 'small' claims. A trial at an Australian district court costs an average of AUS$8,000, Supreme Court costs AUS$33,000 and complex cases have been known to get up to AUS$400,000. As one can imagine the costs of a trial can easily excess the amount in dispute. The same goes for England, Wales and USA. Mediation in Australia costs between AUS$0 and AUS$2,000 depending on what it is about and who you consult. Mediation is a great deal cheaper than going to court and it might solve the underlying problem which is why ADR/mediation started out in family courts/conflicts. Also, it is fast. That makes it an interesting proposition for companies who want to avoid dragging cases though courts for the next couple of years. They might prefer expert mediation.
One thought on why mediation is not catching on in civil law countries is, the costs of a trial are set by a fixed system which makes sure that the lawyers do not cost more than the amount in dispute so the cost-saving factor does not come into the equation.