Attending a mediation, in the franchising sphere or otherwise, can be a daunting process for all involved. Knowing what is likely to occur and planning is critical to promoting a favourable outcome and ensuring time spent at the mediation isn’t wasted. So, what will actually happen? Importantly, there isn’t a prescribed law or regulation dictating what happens at a mediation and this typically depends on the nature of the dispute and the mediator. Below, we set out seven steps to guide you through the process.
1. Pre-Mediation Conference
The pre-mediation conference, as the name suggests, occurs before the mediation via phone or other electronic means. This is where the parties and the mediator firm up practicalities (i.e. date, time, venue and exchange of documents). Sometimes, each party articulates what they consider the issues in dispute and their position. This conference usually takes no more than thirty minutes.
2. Signing of Mediation Agreement
Usually before the mediation itself, a written agreement will be distributed to all parties setting out the basis on which they agree to mediate. The Agreement includes that parties are attending the mediation in good faith and agree that the mediation is conducted on a without prejudice basis. Without prejudice means that parties can’t rely on the mediation in any subsequent court proceedings.
Once parties have introduced themselves and are sitting around a table, the mediator will usually begin the proceedings by making a statement as to what will occur at the mediation and their role throughout the day, including encouraging parties to cooperate and adopt a commercial view. The mediator may indicate what documents parties have provided and/or outline their understanding of the events.
4. Opening Statements
Each party to the meditation then gets a turn to ‘state their case’ both regarding their version of the facts, but also the law. For example, one party may believe the other has breached a clause of the Franchise Agreement, or that they relied on misleading statements when deciding to enter into the Franchise Agreement. Usually, the first party to speak (the applicant, or party bringing the dispute) will be afforded a few moments to address any issues raised in the second party’s opening statement.
5. Mediator Comments
The mediator will then usually ‘wrap up’ the group session by seeking any necessary clarification, and explaining the ramifications of proceeding to resolve the dispute in court. Mediators are generally reluctant to indicate what they believe would be the outcome of the dispute if judicially determined. Their experience, however, as members of the legal community (often legal practitioners or former judges) equips them to provide insight on the costs, time commitment and other hurdles that the parties may face should they commence proceedings.
6. Exchange of Offers
At this point, the parties will go to separate rooms and the mediator will act as a ‘go-between’ for the purpose of promoting settlement and exchanging offers. This process, in itself, can often take the better part of the day as offers are formulated and considered.
Them ediator will assist parties with documenting any agreement reached and ask each party to sign. Alternatively, if settlement discussions are ongoing and there seems some use in meeting again, the mediator may adjourn the mediation on specific terms.
If you have any questions about your upcoming franchise mediation, get in touch with our franchise lawyers on 1300 544 755. In the meantime, you can read our article for some helpful tips on what practical steps you can take to assist with preparing for your mediation.