Let us mediate? We do not have a choice

mediation

On 9 March 2020, Uniform Court Rule 41A came into effect. This new Rule compels the parties to consider mediation before approaching the High Courts of South Africa for any relief.

Mediation is a voluntary process entered into between parties by agreement. An impartial and independent professional mediator will be commissioned by the parties to assist the parties to resolve their dispute by identifying the issues which the parties can agree on and explore certain areas of compromise in an attempt to amicably settle the dispute.

The new Rule requires a Plaintiff or Applicant who is contemplating any action or application in any High Court of South Africa to deliver a notice of mediation to the Defendant or Respondent. The notice of mediation will provide the Defendant or Respondent with an opportunity to agree or refuse to the referral of the dispute to mediation.  Should the Defendant or Respondent refuse to submit to the mediation process, valid and substantial reasons for such refusal must be filed at Court. A Plaintiff or Applicant who refuses to submit to the mediation process will also be required to file valid reasons for such refusal to submit to the mediation process.

The mediation process shall commence once a joint minute has been signed setting out the mediation agreement, who will be appointed as the mediator, when mediation will take place and how the mediation costs will be borne by the parties. The mediation process must be concluded within a maximum period of 30 court days. During the mediation process, all time periods relating to the delivery of pleadings, notices or any further steps in terms of the Rules of the High Court are automatically suspended for the duration of the mediation. It appears that commencement of the mediation process may also interrupt prescription.

At any stage of the mediation process, should one of the parties believe that the other party has entered into the mediation process in bad faith or that the suspension of the time periods are being abused by the other party, the aggrieved party may apply to the Court to have the suspension uplifted to immediately commence with its intended action or application.

Should the parties fail to finalise the mediation process within the 30-day period, the parties may apply to the High Court to have the mediation period extended.

On conclusion of the mediation process, the parties shall inform the Registrar of the Court that the mediation process has been concluded. If mediation is successful, the parties will enter into a settlement agreement which may be made an Order of Court. Should mediation be unsuccessful, the parties shall within five days after the conclusion of the mediation process, file a joint minute indicating whether mediation was fully or partially successful, whether settlement can be achieved in the dispute and list all of the issues which are not in dispute between  the parties. The notice exchanged by the parties to commence the mediation process must be attached to the Plaintiff’s or Applicant’s summons or Notice of motion when issuing same.

As with all types of mediation, any communications and disclosures made during the mediation process is strictly confidential and is classified as inadmissible evidence should the matter proceed to trial in the High Court. Any offer or tender made during the mediation process is made on “an without prejudice basis”, meaning it cannot be disclosed to the Court at any time before judgment in matter is handed down. The only time disclosures made during the mediation process will be admissible to the Court is when the Court is deciding on costs.

For most litigants, this new Rule comes as a relief to litigation. It forces a Defendant to immediately answer a Plaintiff’s claim without the opportunity of hiding behind “clever legal delay tactics” for a period of two years or more, before a trial date is allocated to the matter.

However, this Rule is relatively new, the mediation process already possesses various challenges. For instance to name a few;

  1. It may be used as a delay mechanism by Defendants attempting to avoid Default Judgment and/or Summary Judgment proceedings.
  2. The Rule fails to provide a time limit for the signing of the joint minute to commence mediation, which will further delay the matter should it eventually be referred to the Court for a decision.
  3. Litigants legal costs will naturally increase given their legal representatives will assist them during the mediation processes as well as represent them at Court should mediation fail;
  4. The recourse available to the plaintiff or applicant to bring an application to Court to uplift the suspension of legal proceedings during the mediation process will no doubt result in further unnecessary legal costs and wasted time.
  5. The Rule change also seemingly applies to urgent applications, which naturally poses obvious challenges regarding the applicable time periods available to the litigants.

We at BBP Law however believe that the abovementioned challenges, as well as others, will be addressed as the mediation process is implemented throughout South Africa. We look forward to this alternative dispute resolution tool playing an integral role in resolving civil disputes quickly and more cost effectively.

At BBP Law, we offer accredited mediation services as a method of alternative dispute resolution. Contact us to help you resolve your disputes amicably.

 

For further information, please do not hesitate to contact us.

Matthew Ashworth                             
matthew@bbplaw.attorney
Senior Associate

072 530 5011

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