Enforcing Mediated Settlement Agreements: Critical Questions and Directions for Future Research

Abstract

This article discusses a range of critical issues and policy concerns involved in the ongoing debate about the status of mediated settlement agreements (or MSAs) reached in cross-border disputes. It examines current methods of MSA enforcement in various jurisdictions and it identifies their strengths and shortcomings. The article then focuses on two questions:

1. Why should mediation and MSAs be given preferential treatment over unassisted negotiation and traditional contracts?; and alternatively, 2. Why should mediation not be given special treatment? Would a system which enforced MSAs undermine the values and objectives of mediation? It is suggested that such a system would, in fact, further central values and objectives of mediation such as those of self-determination, consensuality and party autonomy.

The article then suggests directions for future research and analysis. We (the international community) have two main options for the future. We can:

1. Maintain the status quo (with some MSAs being enforceable as contracts, some as consent court orders, some as consent arbitral awards, and some not enforceable at all); or 2. Create a new system for the enforcement of MSAs, a New York Convention style system which recognises and enforces MSAs as MSAs.

The first option will perpetuate diversity, a lack of uniformity and uncertainty in the use of mediation. The second option poses challenges, but we ought to strive to overcome them. The arguments in favour of creation of a new system for mediation are persuasive.

Keywords: mediation, cross-border disputes, mediated settlement agreement, MSA, consent arbitral award, UNCITRAL Model Law on International Commercial Conciliation, EU Directive on Mediation