JAMS International ADR Blog

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The mediation process: what, when and where?

by Matthew Rushton on 02 Dec 2016

The mediation process presents an opportunity to engineer a more favourable settlement than might be achievable through the courts. As an alternative, it offers swift resolution of a dispute and the return to a productive working relationship. 

Mediation is about finding an intelligent, pragmatic and commercial basis for resolving a dispute above and beyond the minutiae of legal argument. If, during a mediation, the "right" legal answer is found, that should be seen as a fortunate by-product, and not the object of the exercise.

So, how should you conduct the mediation process

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Why Brexit negotiations will fail

by Matthew Rushton on 29 Nov 2016

Brexit negotiations present a soup of toxic ingredients familiar to any commercial mediator: high stakes, high emotions, personality clashes, lack of preparation, restricted time and a misconceived negotiation strategy.

At stake is the world order that has kept the peace in Western Europe for seventy years. The EU’s founding premise was to bind France and Germany in so tight an embrace that they could never again raise arms against each other. The Brexiteers are far from unified, but reject the status quo. At their outer fringes they rejoice in the possibility that Brexit could trigger the EU’s ultimate destruction. Their vision is a Europe of disaggregated independent states, with strong borders and restrictions on free movement of people.

The backdrop to these competing visions is emotional and antagonistic: threats of civil disobedience, coupled with a surge in hate crime and the murder of a Member of Parliament, hint at the likely social cost of an unsatisfactory outcome to negotiations. The economic cost of failure is likewise grave, and would fall disproportionately on the UK where lower investment, lower productivity, higher inflation and increased government borrowing could impact generations as yet unborn.

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Singapore competes as an international dispute resolution centre

by Philip McMullan on 25 Nov 2016

Singapore has been steadily growing in importance as an international dispute resolution centre in Asia Pacific in recent years. The Singapore International Arbitration Centre's (SIAC) 2015 annual report noted that the jurisdiction had enjoyed its best year since the body was founded in 1991. Not only was it a record year in terms of the highest ever number of cases filed (271), SIAC also reported that the cases involved the highest ever total of sums in dispute – S$6.23bn, around US$4.4bn.

Singapore is vying with Hong Kong for the top spot in Asia Pacific but still has some way to go. The Hong Kong International Arbitration Centre's (HKIAC) 2015 annual report records 271 arbitrations, 22 mediations and 227 domain name disputes. The total aggregate sums in dispute for arbitration matters were US$6.2bn, around a third more than Singapore. Hong Kong has a six-year head start on Singapore (HKIAC was founded in 1985), so it is not surprising that it hosts more international arbitrations. But now the city-state is bringing forward legislation to make alternative dispute resolution (ADR), whether arbitration or mediation, more accessible, hoping to close the gap on its rival.  

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How is third-party funding used in UK arbitration?

by Philip McMullan on 17 Nov 2016

The use of third-party funding in UK arbitration has grown significantly in recent years, with some funders now reporting that their portfolio of cases is equally weighted between litigation and arbitration matters.

At a recent Q&A, Ruth Stackpool-Moore, director of litigation funding and head of Hong Kong at Harbour Litigation Funding, explained that the past 12 months have seen further exponential growth in the use of third-party funding generally and, particularly, an increase in the number of enquiries regarding arbitrations - especially from large, well-capitalised companies.

Now a decision of the High Court has further advanced the cause of litigation funding for arbitration in the UK. In Essar Oilfields Services Limited v Norscot Rig Management Pvt Limited, the High Court upheld an arbitrator's award, which ruled that nearly £2 million of arbitration funding costs were "other costs" within the meaning of the Arbitration Act 1996 and so were recoverable from the claimant. While the facts of the case are such that they may not amount to strong authority, the Court signalled that there is a distinct recoverability regime for parties to arbitration.

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Evaluating arbitrators: you be the judge

by Matthew Rushton on 10 Nov 2016

In 2007/8, I set up a now long-since defunct website (disputesloop.com) with the lofty aim of introducing some transparency into the appointment process of ADR neutrals. At its core, the site offered a battery of neutrals' CVs supplemented with free-form written feedback from users.

On one level, it aimed to substitute the kind of third-hand market gossip that makes some ADR careers and breaks others, with something substantial, first-person and, importantly, in the public domain. I was keen for this feedback repository to develop into a body of market knowledge to inform the uninitiated and to develop a framework for objective discussion of the competencies of mediators and arbitrators.

The hope was that users would become more discriminating in their choice of ADR professionals, more concerned to match skills and competences to the requirements of the case, and more articulate about what they wanted from ADR professionals. I also hoped that the site would guide the market's invisible hand to push out those who overtraded and under-delivered, while rewarding the capable and conscientious.  

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Hong Kong Arbitration Week: a note from a small island

by Matthew Rushton on 02 Nov 2016

For all the commendable change in international arbitration, we're still squeezing the wrong end of the toothpaste tube.

Despite two typhoons, a black weather signal, and the potentially bleak theme of "arbitration challenged", Hong Kong Arbitration Week (17-21 October, 2016) was an upbeat affair. And why not? Numbers of international arbitrations have been growing steadily worldwide for the last decade, with notable success in the Asia Pacific region.

But, as every investor knows, past performance is no guarantee of future results. Sir Vivian Ramsey outlined four areas of concern to the arbitral community in his keynote speech at the ADR in Asia conference: time and cost; competition (both from other ADR methods, and from new and existing commercial courts); the so-called "Thomas Point" (concern that courts should intervene more in arbitration to develop the common law); and, finally, ISDS issues and the prospect of a two-tier court for investor-state matters. 

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How is third-party funding affecting arbitration?

by Philip McMullan on 28 Oct 2016

Third-party funding has had a significant impact on litigation in recent years as corporates and law firms seek to control their risk profile while accessing capital that might otherwise be tied up for long periods.

At a recent Q&A session, organised by law firm Norton Rose Fulbright, leading players in funding set out how international arbitration is being affected by the availability of alternative funding mechanisms.

The growth of third-party funding

Asked about emerging trends, Ruth Stackpool-Moore, director of litigation funding and head of Hong Kong at Harbour Litigation Funding, explained the rapid changes she is seeing: "The past 12 months have seen further exponential growth in the use of third-party funding generally and, particularly, an increase in the number of enquiries regarding arbitrations.

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Why London remains a key centre for maritime arbitration

by Philip McMullan on 14 Oct 2016

Britain has a long and proud maritime history with London at its heart. From Sir Francis Drake to Captain James Cook, British sailors have had a huge impact on world history, and the fact that the prime meridian runs through a suburb of South East London illustrates the UK’s central role in the history of seafaring. The economic impact of shipping to the nation’s prosperity and development is incalculable – it is an over-simplification to say that the British Empire was built on sea power, but true nonetheless.

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Are hostile mediators more effective?

by Matthew Rushton on 12 Oct 2016

New research by Francesca Gino and Ting Zhang of Columbia Business School, along with Mike Norton of Harvard Business School, suggests that the most effective mediation style might be being partial against both parties. The academics suggest that, contrary to the received wisdom that mediators should be neutral, attentive and empathetic, an actively hostile mediator is more likely to get a good result. They discovered that a mediator’s antagonistic and hostile treatment of both parties causes adversaries to unite against the mediator, which in turn increases the parties’ willingness and propensity to reach agreement.

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Courts penalise failure to engage with the mediation process

by Philip McMullan on 07 Oct 2016

The Civil Procedure (Amendment) Rules 2013, known colloquially as the Jackson Reforms, didn’t change the substantive rules governing when courts would require parties to engage in alternative dispute resolution (ADR). But the focus on efficiency, case management and controlling costs marked a change in tone which was always likely to advance the cause of ADR.

The benefits of ADR, in particular mediation, are clearly in line with what Jackson sets out to achieve in terms of driving value for money, efficiency and speedy settlement. And while the courts have long had the power to penalise parties in costs for unreasonable refusal to engage in the mediation process, application of that power has been inconsistently applied.

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