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Can Companies Engage in Mediation? How Does It Work?

Posted by M. Margaret Gonsalves-Sabola | Feb 21, 2019 | 0 Comments

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Companies can engage in mediation, just like individual people with disputes. In fact, many mediations happen between an individual and a company, or between two companies. When a company is involved, a mediation may proceed a little differently than you might expect.

Who Represents a Company at a Mediation?

Some individual person has to represent a company at a mediation. The company needs a voice and a way to engage in the discussions with the mediator. In addition, the company needs to have a decision-maker present who can decide whether to make a settlement offer, how to negotiate, and whether to accept or decline a final settlement.

At many mediations, someone in authority in the company attends, such as a president, a director, a general legal counsel, or a high-level manager. Often several people from the company come to assist with evaluating the claims of the other party to the mediation. For example, a witness to the events that led to the dispute may attend, along with a director who has the power to offer settlement.

Depending on the type of dispute, the company may have insurance that covers the claims. Some companies have general liability insurance, professional insurance, or other kinds of insurance depending on their industries. If there is insurance, then a representative of the insurance carrier likely will attend the mediation. This representative may have the decision-making power to offer a settlement for all or part of the dispute.

Why Do Companies Attend Mediations?

Companies decide to engage in mediations of disputes for several reasons. For one, mediation is a great way to resolve a dispute confidentially. Many companies are worried about negative publicity if word gets out that people are asserting legal claims against them. Or they may worry that when people find out that the company paid money to settle claims, a lot more people will come forward asking for money. Because mediators ask that participants keep everything that occurs to themselves, companies avoid those risks.

Second, companies may save money through mediation, versus the costly and time-consuming process of dealing with a court case. This is not to say that companies get off easy in mediation – just that the parties may both recognize the risks of moving forward in court and decide to settle early on. Mediation can be quite helpful in resolving contentious disputes between large companies and individuals or other companies.

To find out more about mediation in The Bahamas, visit Gonsalves-Sabola Chambers online or call the office at +1 242 326 6400.

About the Author

M. Margaret Gonsalves-Sabola

M. Margaret Gonsalves-Sabola is a civil and commercial litigation attorney and an accredited civil and commercial mediator. Margaret has over 21 years' experience in legal practice in the United Kingdom, Jamaica and The Bahamas.

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