When Maritime Mediation is Preferable to Maritime Arbitration

When Maritime Mediation is Preferable to Maritime Arbitration

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In a paper presented by Rodney Elden and Irene Ziebarth to the 8th International Conference of Maritime Arbitrators in Auckland, New Zealand (March 1-5, 1999), the authors lay out points to assist in determining if maritime mediation is preferable to maritime arbitration to resolve specific maritime disputes. The paper was entitled “Does Mediation Have a Place in International Maritime Disputes?” and discusses the general benefits of ADR practices for resolving disputes that arise in maritime environments and maritime-related business situations.

According to their article, factors that favor mediation to resolve maritime disputes include:

  1. The business relationship could continue or be resumed;
  2. It is desirable to be able to control the outcome of the dispute;
  3. The position of each side has merit, and arbitration could well result in either side prevailing;
  4. Arbitration preparations would be costly and protracted;
  5. A speedy resolution is important;
  6. The dispute raises highly technical or other complex factual or legal issues;
  7. The law on the determinative legal issues is well settled;
  8. An adverse precedent needs to be avoided;
  9. No further discovery is required, or limited discovery will suffice, for each side to assess its strengths and weaknesses;
  10. The case lends itself to settlement before an arbitration award is made;
  11. A presentation by each side of its best case will help promote a better understanding of the issues;
  12. A strong presentation will give one side or the other a more realistic attitude about the case;
  13. A mediator could help diffuse the emotion or hostility which may bar a settlement of the dispute;
  14. The evaluation of a neutral advisor could help break the stalemate;
  15. There is a potential for a runaway verdict based on sympathy with the plight of the other side; and
  16. Neither side really wants to arbitrate.

On the other hand, the authors state that there are certain factors that favor arbitration as a way to resolve maritime disputes, including:

  1. A vital corporate interest is involved;
  2. There is no bona fide dispute; the other side’s case is without merit;
  3. The advantages of delay run heavily in favor of one side;
  4. The case most probably can be settled in the near future through simple unassisted negotiation;
  5. The other side has no motivation to settle because of expectations of a large judgment or a highly emotional stake in being vindicated;
  6. More time must elapse before each side’s positions and the settlement possibilities can be evaluated;

In either case, the benefits of ADR to resolve maritime disputes are obvious.