What is Mediation?

Mediation is an out-of-court process aimed at resolving conflicts. In contrast to court proceedings or arbitration proceedings, there is no higher legal authority in a mediation process which decides how the conflict should be resolved. Rather, the parties themselves, with the help of a neutral, “multipartial” third party (mediator), try to resolve their own conflict in joint meetings.


The role of the mediator is to lead and add structure to the communication and negotiation process so that all parties can participate on an equal basis in the discussions and to ensure that certain standards of mutual respect are observed by all parties during the course of the mediation. The mediator does not offer any of its own solutions but tries to encourage the parties to find a creative solution on their own by asking certain questions, encouraging brainstorming, by telling the parties about solutions found in other mediations or by referring to typical solutions for the particular type of situation.


In a mediation, all of the parties have an opportunity not only to find out more about, and to express, their own needs and interests in relation to the conflict issues, but also to find out more about the needs and interests of the other parties. During the meeting, the mediator will also discuss with the parties what kind of fairness criteria they think a fair solution should be based upon.


The process of trying to understand the other party's needs and interests takes up a lot of time in the mediation process, unlike in other types of conflict resolution proceedings. It is generally worth the time though because it often leads to solutions which are more “durable” and more accepted by the parties than decisions made by third parties charged with legal authority.


The solutions reached in a mediation are not mere “declarations of intent” or “gentlemen's agreements” but rather binding agreements. In some cases, it may be necessary to have the agreements reached in the mediation memorialized in some legally binding form such as having the agreement notarized.


In principle, all participants are required to consult individually with their own external legal counsel at the latest before the signing of the final agreement. This ensures that each party has an opportunity to review whether and to what extent the solution found in the mediation process, based upon the parties’ own fairness criteria, may differ from the outcome provided by law and, if necessary, critically to reconsider the planned agreement in light of this information.


Participation in a mediation is voluntary. The parties can end a mediation at any point in time during the process. Similar to a lawyer or doctor, the mediator is legally bound to confidentiality. The parties also agree to mutual confidentiality, which means that what is discussed in the mediation must not be used in any form outside of the mediation.


Furthermore, the mediation process requires openness and fairness of all parties. That means that all parties must be prepared to have open discussions without a predetermined outcome and should not come into the process only willing to accept one solution. In exchange for this openness and fairness, the mediation process ensures that all relevant needs and interests of all parties will be considered in the final solution.


Finally, all participants are required to disclose all relevant economic and financial information, but also personal plans and circumstances which are important to issues discussed in the mediation. This is the only way to reach a fair solution with the interests of all parties in mind.