|
|
|
|
MEDIATION in Shipping Piraeus can become international shipping disputes resolving forum. By Nick C. Papayannopoulos (*) With the advent of the concept of Mediation (the most popular world-wide form of Alternative Dispute Resolution, "ADR") into Greek civil law justice system, a new era in resolving international shipping disputes may well rise in Greece, Piraeus particularly. By virtue of Greek Law No.2479/1997, the parties to a dispute with a value exceeding (as from 1st November 2000), 15 million Greek Drachmae ( 44,020 Euros) must as a pre-trial requirement meet and attempt to settle outside the Court system, assisted if they so desire by a Mediator. If the parties fail to settle, the case will proceed to a Court hearing. The same law further provides for an adequate set of rules completing a model system for the operation of the new concept.In Mediation, the parties negotiate and agree themselves upon a settlement of their dispute, assisted by a third party (a trained Mediator). Neutral and detached from the parties' problem, the emotion / commercial pressures, uncluttered by the detail, a Mediator can (and does) bring a clear mind in the settlement process. Employing appropriate management techniques, a Mediator can be the catalyst towards a settlement, in a way just not possible for the parties (or their lawyers), as they cannot avoid taking sides, when negotiating a settlement of their own dispute. A brief outline of the main features/benefits of Mediation, compared to the established dispute-solving methods (a Court/Arbitration trial), would include that it is a confidential process; every-thing exchanged in separate meetings with the Mediator is confidential; the Mediator cannot be examined as a witness. Mediation is voluntary; the parties are free to leave at any time; until a settlement agreement is signed, nothing is binding upon the parties; the parties are not restricted from their right to refer ultimately to the judicial process. Mediation requires the close involvement of the parties; knowing the factual strengths and weaknesses of each other, they are in position to arrive at a realistic and mutually acceptable solution. The parties retain a complete control over the final decision, since (unlike a trial, where the outcome is determined by a judge/arbitrator, many times in a quite unexpected direction) the Mediator does not impose (he only facilitates towards) a settlement. Mediation means saving in time and costs; it usually takes only one or two working days; even if Mediation fails, the cost of its preparation is not wasted, as it will be useful for the trial to follow. Mediation looks forward, encouraging the parties to look to the future rather than history. Of course, not all disputes are resolved by defining a future relationship, but the vision of a future without the hangover of a dispute can in itself be a powerful incentive for settlement. Currently Shipping may look slow in picking up on Mediation (perhaps due to a ritualised litigation culture), however, it seems unavoidable that Mediation will soon become a celebrated dispute-solving practice in this field too. Mediation clauses are already found in charter-party contracts. Between Chilean and Dutch parties a dispute arose out of a voyage, performed in 1993 under a time charter-party, from Durban and Cape Town to various South American ports. The Charterers claimed for loss of or damage to cargo sustained due to an explosion on board the ship, whilst en-route to her first discharge port. The Respondent Owners counter-claimed for the damage sustained by the ship in the explosion and miscellaneous expenses relating to the casualty. Arbitration started in 1994. The amounts in dispute ranged between US $4.8 and $8 million. Following a preliminary meeting in 1997 at a Mediation provider (**) the parties agreed to mediate subject to agreement on the Mediator's identity and on procedure. Five hours of preparation work was conducted before the Mediation. The Mediation itself lasted one and a half days. Between the decision to mediate and the final outcome it took two months overall. At the end of a discouraging first day the Mediator encouraged the parties to continue the Mediation process into a second day, to which they agreed. Part of the claim was settled before the second day of Mediation, the balance was settled on day two itself. The Mediation process concluded in a binding agreement settling all claims and counter-claims and the arbitration proceedings where they had been brought. The cost of the Mediation per party, including preparation work, was US $4,800- Even if they do not settle in Mediation, the parties get the opportunity to appraise seriously their point of view, at low cost and on a non-binding basis. Often they settle soon after a "failed" Mediation. It may be that disputants in Shipping, members to a P&I Club, are reluctant to appreciate the comparative benefits of Mediation. However, P&I Clubs, projecting astronomical figures for legal costs in arguing disputes in arbitration or in Court over the next decade, are bound to encourage members to mediate, at least certain type of disputes. It should not fail attention that after Lord Woolf's reform to English Civil Procedure, English judges have extensive power of case management, including: " encouraging the parties to use ADR procedure if the Court considers that appropriate, and facilitating the use of such procedure". Accordingly, a party non-impressed by Mediation and taking refuge for the solution of a shipping dispute traditionally to English Courts is very likely to end up in Mediation (!) ordered by the Court.Consistent with the up-coming trend, the LMAA is investigating the provision of mediation training for its members, so that it can provide effective ADR (Mediation) service to shipping disputants. Piraeus, although the basis of a significant part of world-wide shipping industry, has not appeared as a forum for resolving international shipping disputes. The perplexity of Greek Maritime Law/Procedure, coupled with a fear of favouritism, may have been the reason. However, Mediation overcomes effectively all relevant apprehensions. As in essence it is a non-binding (until a settlement is agreed and signed) negotiation of a dispute, the process of Mediation is not subject to jurisdiction, except for the rules of conduct, which the parties may agree in front of the Mediator. In this regard Mediation is particularly appropriate for international disputes, and can be conducted in any related place, without any bearing on the "proper law" of the underlying relationship (contractual or otherwise), neither the "proper forum", which shall have to be determined in Courts in due course, if Mediation fails. Of the core features of Mediation, and the virtues of a Mediator, is confidentiality and impartiality, otherwise the parties are likely not to trust the Mediation procedure, hence it will fail. Nonetheless, the fact that in Mediation it is the parties who decide the settlement, not the Mediator who imposes one, constitutes an absolute safeguard of the interests of either party, against any apprehended question-mark over a Piraeus based Mediator's attitude. Finally, Piraeus may possibly count native maritime lawyers and other maritime experts educated in English Universities as many as London. Additionally, nearly all the major English law firms specialising in shipping disputes are present in Piraeus. English language has become "lingua franca" in shipping world-wide, including Akti's Miaouli water-front. The Piraeus maritime fraternity (not necessarily lawyers only) should rather embrace the new dispute-solving concept introduced in Greece, train themselves in it, and practice it intensively, so as to gain soon the appropriate experience required for conducting a Mediation in the right sense. Piraeus can rise as a competitive international shipping disputes Mediation centre soon thereafter. ============================ nikos@epilysis.com also: llcf@internet.gr (**) CEDR (Centre for Dispute Resolution) a leading London established ADR/Mediation provider. |
Send mail to nikos@epilysis.com with questions or comments about this web site.
|