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Avoiding Court, or Mediation for Business

Ekaterina Shvets talks about the alternative possibility of dispute resolution with the participation of a mediator – the mediation procedure, lists the positive and negative sides of this method of conflict resolution for business
The Russian doctrine of resolving disputes today, as well as over many decades, traditionally prefers the judicial mechanism for protecting violated rights and interests. However, for all its merits, Russian justice today has a number of shortcomings, among which we can mention the high workload of the courts, which determines the length and complexity of the judicial procedure, significant legal costs. Moreover, the decision made by the court often does not suit both parties, as a result, the conflict is not resolved, but is terminated by a forceful decision, which does not cause the parties to desire to fulfill it implicitly.

At the same time, the pace of “growing up” of Russian business, as well as the active expansion of foreign economic relations, require more flexible operational forms of settlement of disagreements from participants in entrepreneurial activity, rather than a lengthy and costly judicial procedure. In such circumstances, the development of non-state procedures for the resolution of legal disputes and conflicts has become particularly relevant.

Of course, the most optimal form of resolving any conflict is the reconciliation of the conflicting parties. At the same time, there is a fundamental difference between the concepts of “reconciliation of the parties” and “amicable settlement”. A settlement is a procedural form of reconciliation, while reconciliation serves as an incentive to conclude a settlement.

An important milestone in the development of alternative judicial procedures for the settlement of disputes in Russia was the adoption of Federal Law No. 193-ФЗ On an Alternative Procedure for the Settlement of Disputes with the Participation of a Mediator (mediation procedure) (hereinafter referred to as the Law on Mediation).

It is noteworthy that, according to the content of Article 33 of the UN Charter, mediation is classified as a means of resolving disputes. This procedure is widely used in the Anglo-Saxon system of law, in the USA, Canada, New Zealand, Australia and in Europe. According to official statistics, in the United States 95% of cases, having passed the mediation procedure, do not reach the court, in the UK – 90–95%, in Germany – more than 90%, in Europe the average mediation performance is from 40 to 80%.

So what is mediation?

Without resorting to the normative definition of this term, I note that this is a dispute settlement procedure by the parties entering into voluntary negotiations in the presence of a neutral person – a mediator (mediator) in order to achieve mutual understanding and draw up an agreement resolving the disputed situation.

The benefits of the mediation process stand out against the background of its comparison with traditional judicial methods of dispute resolution. This procedure may be used to resolve any disputes. Moreover, the mediator is based not so much on the requirements of the law as on the interests of the parties, the norms of morality, using personal life experience. The mediator “does not teach, does not heal, does not judge.” No matter how much he wants it.

In addition, mediation is limited by the communication between opponents and the mediator, which allows the parties to avoid disclosure of the conflict, as well as to avoid adverse consequences, to maintain normal personal or business relations.

In contrast to the litigation, mediation is not associated with lengthy bureaucratic procedures, document management features and complex procedural rules. Mediation is democratic – the parties have the right to independently choose a mediator, with whom they jointly determine the procedure for this procedure.

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