MEDIATION AS A DISPUTE RESOLUTION MECHANISM IN NIGERIA: AN OVERVIEW

MEDIATION AS A DISPUTE RESOLUTION MECHANISM IN NIGERIA: AN OVERVIEW By Babayemi Olaniyan Esq, LL.M Notary Public, ACIArb(UK), AICMC, ACIS, ABR

ABSTRACT
When commercial disputes arise, parties may opt to settle the disputes through litigation or by alternative dispute resolution methods, one of which is Mediation. The recent popular preference for this alternative is as a result of the waning confidence and outright distrust of disputants for the judicial systems, inadequacies to justify the costs of time, money and injured relationships. It is against this backdrop that alternative methods of dispute resolution have resurged. This article is limited to Mediation, it is proposed to evaluate the concept of mediation, its distinctive feature as a method of dispute resolution from other options, procedure of mediation proceedings and the outcome of its proceeding with respect to its enforcement pursuant to the Arbitration and Mediation Act 2023.

Keywords: Mediation, Arbitration, Disputants, Settlement Agreement, Party.

INTRODUCTION
Disputes can arise in almost any situation where businesses or people interact, especially where interests conflict and cannot be met to the satisfaction of all parties involved. Dispute resolution can therefore be referred to as the systematic process of resolving disagreements between parties, typically through a third party and often based on terms or laws which bind the parties in question. Some of the methods are arbitration, mediation, conciliation, negotiation and other methods which have emerged as innovations in Alternative Dispute Resolution. Alternative methods which today appear innovative are gradually assuming popularity however, alternative dispute resolution are not new ideas but rather the logical expansion of established practice and a quiet revolution is taking place all over the world in the methods available to parties for dealing disputes, one of which is Mediation.

CONCEPT OF MEDIATION
The Arbitration and Mediation Act (AMA) embraces mediation as a legitimate dispute resolution mechanism within Nigeria. Mediation as a mode of dispute resolution is designed to be an alternative to the traditional means of resolving disputes (litigation) and became globally accepted due to its array of benefits. The Act defines “mediation,” as the process where parties seek the assistance of a neutral third party or parties to help them in reaching a mutually agreeable resolution for their dispute arising from a contractual or legal relationship. This definition covers various terms like mediation, conciliation, or other similar expressions.¹

Mediation is a process of joint decision making by the disputants themselves with the assistance of a neutral third party to arrive at a consensual agreement acceptable to both parties. Mediation encourages the restoration of the relationship of the parties and avoids it being prejudiced by a “battle” before a court or tribunal with power to impose a decision. It continues to be a tool in Nigeria for the resolution of disputes in an amicable manner at less cost usually on a win-win basis and with the benefit of face saving. The third party is called the Mediator who is essentially a facilitator who orchestrates the process of an outcome borne out of the willing participation of the parties. Mediation is a compromise-oriented procedure designed to achieve a mutually and tolerable outcome. The new Act also makes it align with the 2018 UNCITRAL Model Law on International Commercial Mediation, laying out a mediation procedure where by at either party’s request, a jointly appointed mediator may review the conflict, hear from the parties, and then submit settlement ideas. Section 73 (5) of the Act provides that mediation sessions can be conducted using electronic means, such as video conferencing or other similar methods of digitally transmitting voice and/or image. However, it is crucial to ensure the identification of the involved parties and adhere to the principles of mediation that have been established.

DISTINGUISHING MEDIATION FROM ARBITRATION AND LITIGATION
Arbitration and Mediation are alternatives to Litigation. Arbitration stands as an organized ADR mechanism chosen by parties, particularly due to its resemblance and complexity to litigation.² The influence of arbitration stems from many of the deficiencies of the traditional courts, some of which are³ frustrating delays which have bedeviled the judicial process; relatively greater financial cost of the litigation process; lack of confidentiality of litigation and attendant adverse publicity; rigid formality that typifies court trials. By its very nature, Arbitration is “the reference of a dispute or difference between not less than two parties, for the determination, after hearing both parties in a judicial manner by a person or persons other than a Court of competent jurisdiction.”

In UBA PLC v TRIEDENT CONSULTING LTD,⁴ the Supreme Court held that Arbitration is a procedure for the settlement of disputes under which the parties agree to be bound by the decision of an arbitrator whose decision is in general, final and legally binding on both parties. The process derives its force principally from the agreement of the parties and in agreement from the State as a supervisor and enforcer of the legal process. So where two or more persons agree that a dispute or potential dispute between them shall be decided in a legally binding way by one or more impartial persons of their choice in a judicial manner, the agreement is called an Arbitration Agreement. An arbitration agreement and an award are both internationally enforceable under the New York Convention. Litigation is a judicial process of resolving disputes by state appointed Judges who determine the rights and obligations of the parties in line with established legal principles by handing down legally binding and coercively enforceable decisions. Parties may appear in person or represented by lawyers. The judgment of a court is final though subject to appeal up to the Apex court.

Mediation is a process of third-party neutral assisted self-determination of disputes by the disputants. It is an alternative to arbitration and a prior option over it where both conflict in that notwithstanding any subsisting agreement to refer disputes to arbitration, parties may opt for the resolution of their disputes by mediation. Settlement agreements arising from mediation are binding on the parties and can be enforced by a court as a contract, consent award, or consent judgment like an arbitral award.⁵ The beauty of mediation is its efficiency, flexibility, cost-effectiveness, and party autonomy. As a matter of fact, these proceedings are not structured to protract or give rise to needless delays or spending needless time, human and financial resources in dealing with a dispute. As a result of this, investors and businesses generally turn to mediation as a means of resolving commercial disputes.

MEDIATION PROCEEDINGS
The principal law regulating mediation in Nigeria is the Arbitration and Mediation Act 2023. The Arbitration and Mediation Act (AMA) has also introduced a substantive and procedural framework for domestic and international commercial mediation and settlement agreements resulting from mediation.⁶ This will help improve the general recognition for mediation proceedings in Nigeria. Furthermore, communications made during mediation proceedings are not admissible in any court or arbitral proceedings.⁷

Scope Of Disputes Amenable To Mediation
Disputes amenable to mediation include:

1. International commercial disputes
2. Domestic commercial disputes
3. Domestic civil disputes
4. Domestic and international settlement agreements resulting from mediation and concluded in writing by parties to resolve a commercial dispute
5. Where parties agree in writing that mediation should apply to the dispute.⁸

Disputes not amenable to Mediation include:

1. Disputes emerging from rights and obligations settlement, which would be void under Nigerian law.
2. Cases where a judge or an arbitrator, in the course of judicial or arbitral proceedings, attempts to facilitate a settlement, unless the parties agree otherwise.
3. Cases that have been recorded and are enforceable as an arbitral award unless the parties agree otherwise.
4. Cases that have been approved by a court or concluded in the course of proceedings before a court, unless the parties agree otherwise.
5. Cases that are enforceable as a judgment of a court in the country, unless the parties agree otherwise.⁹

Role Of The Mediator
Mediation as an alternative dispute process where the parties attempt to resolve their dispute through the help of a third-party neutral. The mediator’s obligations shall be equal to all parties. A specific outline of the role of a mediator is contained in Section 73 of the Act. There shall be one mediator except where the parties agree to have two or more mediators.¹⁰ The mediator is guided by principles of objectivity, fairness and justice but he must consider certain factors such as the rights and obligations of the parties and the circumstances surrounding the dispute.

A mediator is under the duty to promote communication between the parties and must ensure that parties are integrated into the mediation process in an appropriate and fair manner in other words, the mediator must maintain fair treatment of the parties taking into consideration the circumstances of the case.¹¹ Where no agreement on the manner in which the mediation is to be conducted, the mediator may conduct the proceedings in a manner he thinks appropriate taking into account the circumstances of the case, any wish that the parties may jointly express and a need for speedy settlement of the dispute.¹²

At any stage of the proceedings, the mediator may with the agreement of the parties make proposals for the settlement of the dispute but does not have the right to impose a settlement on the parties.¹³ The mediator may meet or communicate with parties either together or separately.¹⁴ Confidentiality is also a hallmark of mediation proceedings, all matters must be kept confidential by the mediator.¹⁵ The mediator must be independent and impartial.¹⁶ The mediator also prepares and drafts the settlement agreement where parties conclude an agreement settling a dispute.¹⁷ The mediator(s) will not be held liable for an action or omission in the discharge of their duties unless such is shown to have been in bad faith.¹⁸

Procedure For Commencement Of Mediation
The process of mediation aims to be mediatory. Mediation can be commenced in two ways:
a) Where it is prescribed as by a special statute as a condition for the conduct of judicial or other proceedings and
b) Where parties have agreed when concluding the agreement to resolve the dispute through mediation before resorting to litigation or other proceedings.¹⁹

However, a party proposing to initiate mediation is obliged to send to the other party in writing the conclusion of a mediation agreement. Where the party initiating mediation does not receive an acceptance of the invitation within 30 (thirty) days However, a party proposing to initiate mediation is obliged to send to the other party in writing the conclusion of a mediation agreement. Where the party initiating mediation does not receive an acceptance of the invitation within 30 (thirty) days of sending the request or within any other time as specified in the invitation, the party may elect to treat it as a rejection of invitation to mediate.²⁰

A party can also propose a mediation process to the other party irrespective of all other judicial or arbitral proceedings before, during or after the initiation of the judicial proceedings.²¹

Where the body conducting the proceedings (either arbitral, judicial, administrative or other proceedings) may recommend that a dispute be resolved by mediation if it assesses that the dispute at hand could possibly be resolved by mediation in accordance with the provisions of the Act.²²

Also, the date of commencement process shall be the date the mediation agreement was signed after a dispute has arisen or the date the court made its decision in case of reference to mediation by the court, or in any case, the date when the mediator took the first step to start the mediation process.²³

Furthermore, communications made during mediation proceedings are inadmissible in any court or arbitral proceedings.²⁴ The mediator cannot act as an arbitrator in respect of a dispute that was or is the subject of the mediation proceedings or in respect of another dispute that has arisen from the same or any related contract or legal relationship.²⁵

Enforcement Of The Settlement Agreement
The new Act provided a substantive and procedural framework for domestic and international commercial mediation and settlement agreements resulting from mediation. Unlike the Arbitration and Conciliation Act 2004, the new Act²⁶ (AMA) provides that settlement agreements arising from mediation are binding on the parties and can be enforced by a court as a contract, consent award, or consent judgment.

In other words, the agreement would then be binding, making the maxim Pacta sunt servanda bear some meaning to outcomes of mediation in Nigeria. The Act also embodies Nigeria’s strides towards becoming a competitive global mediation hub, enhancing its appeal to international investors and traders.

Furthermore, businesses will benefit from mediation as an additional dispute resolution option to litigation and arbitration in settling cross-border disputes.

CONCLUSION
Mediation in Nigeria has developed into a more structured process. The process of mediation has grown and spread around the world and has begun to gain popularity in alternative dispute resolution circles.

The understanding of mediation proceedings is important in considering whether the mechanism would be the best for a dispute, especially commercial disputes. However, we have been able to see from the mediation process discussion above that there are many benefits from mediation, especially for parties who want to preserve their relationship and need some help finding a solution instead of resorting to litigation or any other mechanisms of alternative dispute resolutions.

Hopefully, this article has provided a great base to explore the mediation process and encouraged commercial disputes to be settled through this forum for reasons of speed, autonomy, and preservation of existing business relationships.

It helps to reduce the burden on the litigation system or scope for parties to use court applications as a means of delay. Mediation is preferable to adjudication, and as a result of this, investors and businesses generally turn to mediation as a means of resolving commercial disputes. There is scope for further enlightenment to ensure that a greater percentage of commercial disputants are exposed to the benefits of mediation.

1. Section 91 (1) of AMA ↩︎
2. Y. Shamir and R. Kutner, “Alternative Dispute Resolution Approaches and their Application” (UNESCO Digital Library) available at Alternative dispute resolution approaches and their application – UNESCO Digital Library> (accessed 14
   December 2021) ↩︎
3. Ibid ↩︎
4. (2023) 14 NWLR (Pt 1903) 127 para C-D ↩︎
5. Section 82 (2) of AMA 2023 ↩︎
6. Part II of Arbitration and Mediation Act 2023 ↩︎
7. Section 77 (1) of the AMA ↩︎
8. Section 67 (1) of the AMA ↩︎
9. Section 67 (2) of the AMA ↩︎
10. 1 Section 72(1) of the AMA ↩︎
11. Section 73(2) of the AMA ↩︎
12. Section 72(3) of the AMA ↩︎
13. Section 73(6) of the AMA ↩︎
14. Section 74 of the AMA ↩︎
15. Section 76 of the AMA ↩︎
16. Section 72 (4) & (5) of the AMA ↩︎
17. Section 82(1) of the AMA ↩︎
18. Section 81 of the AMA ↩︎
19. Section 70 (1) of the AMA ↩︎
20. Section 70 (1) & (2) of the AMA ↩︎
21. Section 70 (1) & (2) of the AMA ↩︎
22. Section 70 (4) of the AMA ↩︎
23. Section 70 (5) of the AMA ↩︎
24. Section 77 of the AMA ↩︎
25. Section 79 of the AMA ↩︎
26. Section 82 (2) of AMA ↩︎