The use of mediation as a tool in the disputes arsenal is increasingly prevalent. Whether it is in settling a matter without proceeding to trial/hearing, or in finessing the issues between parties, the benefits of parties meeting face to face with an independent third party can be significant. 

When a matter settles, even partially, the resulting agreement is enforceable in the courts of England and Wales like any other contract. However, that enforcement is set to become much quicker and easier with the UK government's decision to ratify the United Nations Convention on International Settlement Agreements Resulting from Mediation (New York, 2018)¹ (the "Singapore Convention on Mediation" or "SCM").

The decision to ratify the SCM demonstrates the government's commitment to supporting a party's choice to engage in ADR and this recent decision will strengthen the attractiveness of the UK as a legal destination. In fact, the reaffirmation of the UK as a hub for dispute resolution was a deciding factor. The government has indicated that the SCM will be signed imminently, with ratification to follow once the requisite legislation has been implemented. 

What effect will ratification have?

1. The SCM is intended, to some extent, to do for mediation what the New York Convention has done for arbitration. In contracting states, it provides for a mediated settlement agreement to be enforceable by right, without the need for commencing proceedings for breach of contract (as is the current position in England and Wales).
 
The key provisions being:
 
1.1. Article 1, which dictates the agreements to which the SCM applies; 
 
1.2. Article 3, which addresses the key obligations of each ratifying state; and
 
1.3. Article 5, which defines the grounds upon which a court may refuse to grant relief at the request of the disputing party against whom it is invoked.

2. The goal is a uniform global system for international commercial mediation which provides a common understanding and approach in all contracting states and gives certainty to potential parties and their advisors.

3. In England and Wales, this is likely to take the form of a specialised recognition and enforcement procedure.

4. Parties can opt out of the SCM, in which case the settlement agreement would be enforceable under the laws of the country in which enforcement is sought, regardless of whether that country has ratified the SCM or not. 

5. The SCM is non-reciprocal, which means that contracting states have a duty to recognise and enforce settlement agreements from any jurisdiction, provided they meet the international and other criteria of the SCM, regardless of the jurisdiction in which the agreement was concluded and whether that state is a party to the SCM. 

6. Following the consultation process, the Government considers that the SCM could apply to both stand-alone mediation agreements as well as those negotiated during the course of court or arbitration proceedings, so long as the final settlement agreement can be shown to have resulted from mediation.

What were the key takeaways from the consultation paper?

7. The government has not made public the identity of each respondent, however we are told that of the 20 responses (from representatives from England and Wales, Scotland and Northern Ireland), nine were submitted by professional legal organisations, on behalf of individual practitioners and/or firms.

8. Most respondents felt strongly that the UK should become a party to the SCM, for the following reasons:
 
8.1. to raise the profile of mediation;
 
8.2. to maintain the UK’s position as an attractive centre for dispute resolution; and
 
8.3. to signal the UK’s ambition to remain a global leader in Private International Law.

9. It was also noted that ratification would bring an additional benefit of being able to contribute to the development of the interpretation of the SCM's provisions through judgments given on the Convention by UK courts.

10. Dissenters felt that the current legal mechanisms were sufficient and effective, rendering the exercise unnecessary.

Comment

11. The Government has indicated that they will sign the convention as soon as possible and that ratification will take place once the implementing legislation and rules have been put in place (we can assume that this will take the form of an amendment to the CPR).

12. The SCM is relatively new and there is little reported experience from users seeking to avail themselves of its provisions in contracting states to date, however the support that ratification demonstrates will no doubt be of significant comfort to parties engaged in litigation or arbitration where a mediated settlement is a possibility. 

¹ https://uncitral.un.org/sites/uncitral.un.org/files/media-documents/EN/Texts/UNCITRAL/Arbitration/mediation_convention_v1900316_eng.pdf