Although approximately 90% of the actions filed in the Cyprus courts are resolved without a trial, there are still long delays in hearing cases. Mediation aims to reduce the the time taken to resolve disputes and the costs of access to justice. The process was introduced into the Cyprus legal system with national legislation enacted in 2012 to transpose the European Mediation Directive 2008/52/EC. The uptake of mediation was slow at first, but in recent years there has been an increased uptake in the use of mediation as an alternative to a full trial. Mediation is an out of court process where the parties to a dispute come to the proceedings voluntarily accompanied by their lawyers and, with the help of an independent and impartial mediator, negotiate and seek to resolve their dispute by an agreement, which may be made enforceable under certain conditions.
Under Cyprus law, even though costs orders are discretionary, there is a general rule that costs follow the event; that the losing party will be responsible not only for their own legal costs but also the costs of the successful party. Mediation entails lower costs and can be arranged much more quickly than litigation (often within a matter of days or weeks from the date the decision is made to mediate), and generally results in a significant saving compared to the costs of litigation.
A second advantage of mediation is that a settlement reached by mutual agreement is more likely to preserve relationships between the parties than a decision imposed by a court. This can be important in public sector disputes involving bodies such as health or local authorities, and in continuing employment and commercial relationships. Even if mediation does not succeed in resolving the dispute, going through the process may help the parties to understand each other's case, narrow the issues and maintain a relationship through dialogue.
Mediation also avoids the stress of court proceedings. Litigation is a formal process with strict procedures which must have to be scrupulously complied with, but mediation has no such rules or formulas. The parties have complete control of the process, and can ensure the preservation or restoration of good relations between themselves. Experience has shown that one of the greatest success factors for cases achieving settlement at mediation is the attitude of the parties coming to the table. In mediation, the parties feel that they are partners in a common endeavour rather than antagonists, and the resolution of the dispute can involve a much wider range of remedies such as an apology or an explanation rather than the narrow range of remedies that the court has to offer.
A final attraction of mediation in many cases is confidentiality, even regarding the fact that mediation has taken place at all. This is beneficial if the publicity generated by a trial could damage the reputation or goodwill of one or both parties, or would result in disclosure of a trade secret or confidential information.
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