Mediation has gained popularity amongst the international legal field, primarily due to the entry into force of the United Nations Convention on International Settlement Agreements Resulting from Mediation (the “Singapore Convention”). Essentially, the Singapore Convention applies to voluntarily mediated commercial settlements with an international character- meaning the parties are from different contracting states. The Singapore Convention lays out ground rules and procedures for enforcement of mediated settlement agreements.
Mediation in nature is very flexible. Neither the Singapore Convention, nor any other international instrument such as the UNCITRAL Model Law on International Commercial Mediation and International Settlement Agreements Resulting from Mediation touch upon the way mediation proceedings are to be conducted other than general principles such as impartiality, fair and equal treatment, confidentiality and neutrality. As such, – unlike international arbitration- the mediation culture varies across the globe. The mere concept of mediation is relatively new to most civil law countries in Continental Europe, while some common law countries such as the U.S. have a long history of mediation and other out of court settlements.
It is very important for a mediator mediating international disputes to be aware of the cultural differences in the understanding of mediation and help facilitate the dialogue by understanding where the parties are coming from. In order to be able to “connect” with different cultures, the mediator of course should have a rounded- view of the world. However, understanding cultural differences also includes understanding different legal traditions. As such, I believe the mediator should have a multi- jurisdictional education background and encompass experience in the common law and civil law world. For example, in some countries caucus in frowned upon because it is seen as ex parte proceedings; while other cultures embrace caucus sessions as an important tool to overcome impasse. Again, for example, in commercial mediation proceedings in the U.S., BATNA (Best Alternative to Negotiated Agreement) and WATNA (Worst Alternative to Negotiated Agreement) are generally brought up in mediations sessions at some point. However, in some civil law countries, risk and cost analysis and explicit inference to it may be considered offensive. As another example, in a recent mediation I have been involved in concerning civil liability in a cross- border turnkey construction project, [X] corporation and its lawyers from a civil law country had not been aware at any point during contract negotiations of the financial implications and the importance of civil liability in the U.S. legal system; while the other party was not aware of the perception that [X] had on the matter. Therefore, after the dispute occurred, facilitating the dialogue in a way as to bring the parties together and help them understand the differences in their legal traditions was –essentially- an important aspect of the mediation process.
Turning back to the subject matter of the Singapore Convention, contracts governed by the United Nations Convention on Contracts for the International Sale of Goods (“CISG”) are intrinsically within the scope of the Singapore Convention- the CISG governs the substantive law of sales contracts when parties are from different contracting states. CISG is an international uniform law instrument enacted to promote a global understanding of commercial law principles and it adopted concepts from both civil law and common law jurisdictions. However, due to the cultural differences in legal traditions and the lack of facilitation in dialogue, as can be evidenced in various jurisprudence in the Albert H. Kritzer Database of the Institute of International Commercial Law at Pace University, jurisdictions still differ in their rulings because of their understanding of legal concepts. This of course reflects mediation proceedings as well. Facilitating dialogue and enabling a mutual understanding of legal concepts can be done by mediators qualified in different- at the very least two- jurisdictions, one in a common law and the other in a civil law jurisdiction. For example, in a breach of contract claim, the ongoing pandemic had triggered the breach. Concepts like force majeure, hardship, frustration were important and the CISG dealt with the issue. However, due to different legal traditions, the parties had a different understanding of these concepts and could not grasp where the other party was coming from. They wanted to restore their ongoing commercial relationship and were willing to mediate. In this mediation, the facilitation of dialogue encompassed the different legal traditions and the understanding of each party.
In conclusion, the Singapore Convention is an important step to enable the wider recognition of cross- border mediation throughout the globe. However, mediators play an important role as well. Awareness of cultural differences in legal traditions and in the conduct of mediation is key for future success of cross- border mediation. Ultimately, it is up to mediators and lawyers qualified in multiple jurisdictions to facilitate dialogue, bring awareness and ensure future success of the field.
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