Saving Costs Through Mediation



It goes without saying that when a dispute is settled amicably, there are great savings in terms of legal costs. Litigation and arbitration are never cheap undertakings as they generally take much longer (than mediation) and parties hire lawyers who generally render time-based charges. Even when the case settles, much legal costs may have already been spent in legal work such as filing pleadings (or parties’ statements in arbitration) and conducting discovery.

As an illustration, let us look at a High Court civil matter, of say, 5 days hearing. According to Ms Engelin Teh, Senior Counsel of Engelin Teh Practice LLC, the party could end up paying his own lawyers about $150,000 to $200,000 in legal fees by the end of the hearing. Over and above that, if the party were to lose the case, he would have to pay the other side’s legal costs amounting to about $100,000 to $150,000. In comparison, for one day’s mediation for the same matter if attempted early enough, the party would only end up paying $6,000 to $8,000 in legal fees.

At SMC, more than 90% of settled mediations are settled within a day. The mediation process is focused on problem-solving as opposed to adjudicatory processes that involve determining the facts and the law. In mediation, a trained mediator will help parties explore the interests behind their positions, thus helping them to work towards mutually agreed solutions.

Mediation also saves time. Apart from the time in court (that can involve days or even weeks), parties will avoid having to spend days upon days preparing for trial - from ploughing through ancient documents and email correspondence, to preparing and going through court documents. Time and energy spent pursuing litigation could be better spent on productive, income generating opportunities.

Mediation also saves intangible costs such as emotional stress, opportunity and relationship. The adversarial nature of litigation and arbitration inevitably causes emotional stress. Key witnesses have to recount the entire transaction and be subject to cross-examination, the purpose of which is to poke holes in their witness statements and paint them in a bad light. The emotional stress of court or arbitration proceedings hover over parties until the matter is concluded. This could involve the weight of years of fighting. There is the added stress in the uncertainty of outcome, which solely lies in the hands of a judge or arbitrator.

Litigation and arbitration result in one winner and one loser and are adversarial; important relationships (which may even be commercial in nature) may be permanently damaged. However, mediation, being non-adversarial, offers parties the opportunity to clear up misconceptions and doubts about one another, and a skilful mediator may even steer parties to seal the mediation with an amicable settlement. Mediation also allows parties to think out of the box and explore creative win-win solutions together.

Save costs and mediate today.

For more information on mediation, please visit www.mediation.com.sg.

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March 2017 Issue. For past issues, read more here.

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Litigation Conference 2017



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Singapore Mediation Centre | 1 Supreme Court Lane, Level 4, Singapore 178879 Tel +65 6332 4366