Mediation best answer to solve conflict

What can be more morally right and fair than for the parties to a dispute to find a solution that they both find acceptable, writes Alan Nelson.

Mediation encourages relationships. Litigation creates conflict. This, in a nutshell, captures the spirit and advantage of mediation over litigation in civil cases.

But the potential impact of litigation goes beyond the conflict it creates and can be financially ruinous to individuals. In addition, it puts enormous pressure on the public purse.

In a paper he delivered at a summit on mediation in the medical industry on November 1, Dr Johan Walters, former head of orthopedics at Groote Schuur Hospital, pointed out the implications for public health institutions where taxpayers’ money covers legal claims: “The Gauteng government has recently settled claims in excess of R2 billion with about as much still pending. Considering that these funds were destined for the health budget underscores the crisis in public hospitals as well.”

In the private health sector, the potential cost of litigation is already affecting the cost and quality of health care. For example, young gynaecologists entering the profession are increasingly opting out of practicing obstetrics, because of the high premiums that they have to pay in order to safeguard themselves against claims. A gynaecologist would need to deliver 15 babies each month just to cover the exorbitant insurance premiums. If we consider this limitation to careers, extrapolate it to other medical practices and then calculate the impact on access to what could be life-saving health care, we begin to understand the effect litigation has in terms of cost and access to care.

Given these examples, and in the light of South Africa’s potentially crippling labour and civil unrest, mediation has a critical role to play.

On December 1, the Department of Justice is launching a pilot project called “Court Annexed Mediation” in a few select magistrate’s courts to promote access to justice. From this date state-employed officials at some lower courts will be advising the parties to civil cases about the benefits of mediation, and encouraging them to refer their disputes to mediation before proceeding with litigation. This project will in all probability be rolled out to all courts as soon as the necessary resources become available.

With this initiative South Africa follows the lead of many countries that have embraced mediation, and where it is proving incredibly successful as a preferred method for settling disputes. These countries include the US, Europe, India, Mainland China and Hong Kong. In the latter, severe penalties are incurred if mediation is not attempted before litigation proceeds.

For the past 35 years, I have practiced as an advocate – the last 21 of those as a senior advocate, specialising in civil litigation. Before that I was an attorney. During my career I have acted both for and against many of South Africa’s largest corporate and state-controlled entities. I have witnessed first-hand the impact of prolonged trials – in time, money and lost productivity.

Ironically, while modern era technology has made many things easier, it has often made litigation, particularly the pre-trial period, more time consuming; and consequently more expensive. Electronic communication, for example, has made the “recovery” process for trials lengthier as it has caused communication to proliferate exponentially. Then trials can run for weeks and even months, with court days being effectively four-and-a-half hours long, and can cost R120 000 to R150 000 a day when senior and junior advocates are employed on both sides. The judgment process might take six months to a year and sometimes even longer.

With appeals processes, if parties are lucky, it will take about five years for their case to wind its way through the courts, but there are examples of cases taking up to 10 years and even longer. Then there is the cost of recovering legal costs in the case of successful parties. All of these processes require legal or specialist consultants. Save in highly exceptional cases, the costs recoverable from an unsuccessful party do not include all of the legal fees that have to be paid and usually the taxing master reduces the recoverable portion by 30 to 55 percent. This means that the successful party ends up paying a substantial part of the costs incurred. There are long queues of parties waiting for bills to be taxed by the Taxing Masters and it could take years for the taxation process to be completed.

In a matter that I argued recently, it took four years and a further court hearing for the taxation to be finalised.

While justice is defined as “achieving an outcome that is morally right and fair”, one needs to ask whether it can ever be morally right for a successful party to wait for years before his or her matter is decided and then to have to pay between 30 and 55 percent of the costs that were incurred. And if you don’t have the money, courtroom justice is simply out of the question, unless you can find a lawyer who will take up your case on a contingency basis.

It must also be remembered that, as high as they are, legal fees associated with a civil trial are only a portion of the costs that litigants incur. To this must be added the lost productivity of the parties, their staff and witnesses. A few years ago, I was myself involved in a civil suit. For the first time I experienced the worry and sleepless nights that my clients have obviously been going through in the lead up to and during civil trials. The experience was harrowing and the cost of the productive hours that I lost by far exceeded the amount of my claim.

Costly as it was, this experience did me the world of good as it made me realise the immensity of the hidden costs of litigation. (In fact, I was so relieved when the process finally ended in my favour that I donated the full proceeds of the case to a local charity.)

Shortly after this harrowing experience I, by chance, attended a course in facilitative commercial mediation, which has completely changed my perception of our legal system and had a profound effect on my life. Facilitative mediation is designed to assist parties to themselves find a solution acceptable to both. To a seasoned litigator this at first sounded like a pipe dream. My clients always believe they are right and are, at least initially, intent on seeing the other side in court. The idea that they would themselves find a solution acceptable to both sides was beyond the realms of my comprehension.

It was only after the third day of the course that I became convinced that this was possible. We were taught how to listen intently when parties spoke, how to formulate questions that would unveil parties’ true interests and concerns, and reveal their actual needs, the importance of showing empathy and compassion, and eliciting an apology at the appropriate moment.

All of this I thought very wishy-washy until I saw the array of potential solutions actually being generated by different mediators (including myself). That’s when I realised just how powerful mediation could be in resolving disputes, even complex commercial ones.

The point is simply that when parties mediate, they are able, under the mediator’s guidance, to generate a whole range of possible options for the settlement of their differences based on their interests, and then to jointly decide which one suits them best. This a court of law simply cannot do. It decides only who it believes is right or wrong. In facilitative mediation it is not about who is right and who is wrong, it is not about choosing a winner and a loser, but rather about finding solutions that both parties can live with.

These solutions are based on their interest and not on their rights.

So, if justice means finding solutions that are morally right and fair, one has to ask oneself what can be more morally right and fair than for the parties to a dispute to find a solution themselves that they both find acceptable, and to do that expeditiously and at a fraction of the cost and without the trauma caused by litigation? (A calculation that a mediator and I did recently after a successful mediation, revealed that the mediation cost 0.17 percent of what the resolution of the matter via our courts would have cost.)

As mentioned, South Africa is today characterised by conflict and things are apt to get worse unless we make some serious changes. I honestly believe that mediation is one of these. The reality is that conflict destroys many things, including productivity. In the heyday of communism in China, and when life was really tough for Chinese people, there was one mediator for every 100 people and only 10 000 lawyers for 1.5 billion people.

Today China leads the world economically and I honestly believe that this is because, in very difficult times, mediation ensured a productive and relatively happy conflict-free nation, able to get on with the business of building a nation.

I have recently heard two leading economists identify labour and civil unrest as the major factors that are crippling our country’s economy. In my view (as happened in China) mediation needs to become the mainstream way of addressing conflict at all levels in our society and in business. Perhaps then we, too, will become a nation that heads economic development and peace throughout Africa and the world!

I firmly believe that for this to happen, lawyers in South Africa need to take the lead in bringing about this change. There are some mediators that think that lawyers are not supporting mediation for financial reasons and that the loss of billable hours is the cause of their resistance to mediation. My own experience, however, testifies to the contrary and I believe it is lack of knowledge about the huge benefits of mediation that is the real problem.

Despite many jokes to the contrary, most lawyers are in fact ethical professionals who would not advise their clients to opt for an unnecessary and costly procedure if they knew that there was a far cheaper and better one that their clients could follow in pursuit of justice.

The government appears to have tentatively acknowledged the benefits of mediation with its pilot “Court Annexed Mediation” project. In my view, it will have little impact unless backed by lawyers.

*Advocate Nelson SC has committed himself to educating lawyers and the broader public about mediation. He co-presents a course to train new mediators at the University of Cape Town and has founded a not-for-profit Mediation and Peace Centre on his wine farm in Paarl, where mediations will be conducted on a “pay what you can afford” basis. He will be conducting a series of 10 industry-specific mediation summits at the centre this month. He has agreed with other mediators to declare November National Mediation Month, a month during which they will all mediate disputes on a pro amico basis. For further information contact nelson@law.co.za

** The views expressed here are not necessarily those of Independent Media.

Cape Times