1. Economic Benefits
The bottom line is often the measure. Years of experience prove that mediation can drastically bring litigation expenses down.
FACT: In the US, the “Corporate Policy Statement on Alternatives to Litigation”, otherwise known as the CPR Pledge, was signed by more than 800 companies and 3,200 operating subsidiaries to explore conflicts resolution through ADR prior to litigation. These companies include Fortune 500 and mid-sized companies accounting for more than half the GNP. A survey conducted with these companies indicated litigation cost savings ranging from “unquantified but substantial” to “$6-7 million” since signing the pledge.
FACT: The Supreme Court saved the Philippine government an approximate Php 52 million in a matter of 10 days by mediating 1,800 cases, which resulted in the settlement of 1,460 in 10 days. Prof. Annabelle T. Abaya of the CoRe Group trained the first 400 mediators of the Courts.
FACT: In the US, a study generated by the Department of Justice of Oregon determined the following:
1. Mediation was the least expensive of seven ADR options
2. Average monthly process cost of mediation was $9,537.00, compared to: Arbitration $14,290.00; Trial Settlement $19,976.00; Trial Verdict $60,557.00
2. Rapid Settlements
A case is filed in court can take approximately one year to get a trial date. Assuming the case gets settled in 3 years, the other party can file for appeal that typically takes another 3-5 years to resolve. Sum the time, the cost and the stress, and the cost is the most unproductive time of one’s life. While conflict is unresolved, litigants are in for a rollercoaster of emotional, mental, relational, and financial burdens.
FACT: Important strides have been achieved at the National Labor Relations Office when they opened their Mediation Center, where cases are resolved in an average of 2-3 meetings and typically concluded in less than 30 days. At the Department of Trade, case backlog was erased for the first time in 20 years when mediation was introduced. The highest level of case disposition was achieved by the Office of the Ombudsman when mediation was adopted.
3. Mutually Satisfactory Outcomes & Preservation of Relationships
Parties are generally more satisfied with solutions that they themselves crafted and mutually agreed upon, as opposed to solutions that are imposed by a third party decision-maker.
FACT: A study conducted by Cornell University titled, “The Use of ADR in U.S. Corporations,” reveals that of the corporations surveyed, 81 percent of respondents say their corporations use mediation because it provides “a more satisfactory process” than litigation; 66 percent say it provides more “satisfactory settlements,” and 59 percent say it “preserves good relationships.”
FACT: In the Philippines, a big majority of mediation users give the highest satisfaction ratings (4-5 on the Likert scale where 5 is the highest) on the process, the mediator and the outcome.
4. High Rate of Compliance
Parties who reach their own agreement in mediation are also generally more likely to follow through and comply with its terms than those whose resolution was imposed by a third party decision-maker.
5. Greater Degree of Control and Predictability of Outcome
Parties sense a greater sense of control in mediation. Gains and losses are more predictable in a mediated settlement. When parties engage in a deep process where the focus is on needs, the parties often end up getting more than what they originally aspired for.
SOURCE: Article by John L. Woods “Alternative Dispute Resolution: A Tool for Diversity” in the Minority Corporate Counsel Association, www.mcca.com