What to Consider After Commercial Mediation

After the Mediation Day

Whether or not commercial mediation results in settlement, the period immediately after the mediation day requires careful management. Where settlement has been reached, the implementation of the agreement must be handled effectively to ensure that what was negotiated is actually delivered. Where the mediation did not produce settlement, the next steps toward resolution of the dispute need to be identified and acted on promptly, while the insights gained during the mediation are still fresh.

This page is part of the Commercial Mediation Knowledge Guide. If you need a commercial mediator see my commercial mediator page.

Immediate Steps After a Settlement Is Reached

Where settlement has been reached and a written settlement agreement has been signed at the mediation, the first priority is to ensure that the implementation obligations in the agreement are actioned promptly. If the settlement requires a payment, it should be made by the agreed date. If it involves other obligations, such as the transfer of assets, changes to corporate structures or ongoing commercial arrangements, the relevant steps should be identified and allocated to responsible individuals immediately.

Where the settlement is being implemented through a Tomlin order or consent order in ongoing court proceedings, the order needs to be filed with the court promptly. The lawyers involved should handle this, but the client should ensure it is done without delay, particularly where the stay of proceedings and the terms of the order need to be in place before certain deadlines.

Where documentation remains to be finalised after the mediation day, because full detailed documentation of complex commercial arrangements could not be completed during the day itself, the parties and their lawyers should move quickly to produce and finalise the outstanding documentation while the goodwill and momentum of the mediation are still present. Delay in completing post-mediation documentation is one of the most common causes of post-settlement disputes.

Communicating the Outcome Internally

For business owners and directors, the outcome of a commercial mediation usually needs to be communicated to internal stakeholders: board members, senior staff, investors, lenders or family members who are affected by or interested in the dispute. The content of any communication needs to be consistent with any confidentiality provisions in the settlement agreement, which may limit what can be disclosed about the specific terms.

The communication should focus on the commercial outcomes achieved and the path forward for the business, rather than relitigating the dispute or assigning blame. A settlement that allows the business to move forward cleanly is a good commercial outcome regardless of how it compares with what the business owner hoped to achieve at the outset of the dispute. Framing it as such, both internally and to external stakeholders, sets the right tone for the period of implementation and recovery.

What If the Other Party Fails to Comply with the Agreement?

Where the other party fails to comply with the terms of the settlement agreement, legal advice should be taken promptly. The settlement agreement is a binding contract enforceable through the courts. Where the settlement was implemented through a Tomlin order, the enforcement route through the court is more direct. The action to take depends on the nature and extent of the breach, whether it is a simple delay in payment or a more fundamental failure to perform, and whether the breach was deliberate or inadvertent.

Early legal advice on enforcement options is important. Delay in responding to a breach of a settlement agreement can itself create difficulties, including arguments that the non-breaching party waived their right to enforce by accepting the breach without objection.

If Mediation Did Not Result in Settlement

Where the mediation did not produce a settlement, the dispute continues. The immediate priority is to review the position in light of what was learned during the mediation, to reassess the BATNA in light of anything that emerged during the mediation day, and to decide on the next steps toward resolution.

It is worth recognising that a failed mediation is not necessarily a final outcome. Many disputes that do not settle at the mediation itself settle in the days or weeks that follow, because both parties leave the mediation with a better understanding of the other’s position and a clearer sense of the realistic settlement range. The mediator may also be willing to maintain communication between the parties after the mediation to facilitate further progress.

Where the dispute is to continue through litigation or arbitration, the insights gained during the mediation, about the other side’s concerns and priorities, the relative strengths of the respective positions, and the commercial dynamics of the dispute, are all valuable inputs into the litigation strategy, even though nothing said at the mediation can be used as evidence in the proceedings.

Preventing the Same Issues Arising Again

A commercial dispute that has been resolved through mediation often reveals underlying problems in commercial relationships, governance structures, contract drafting or commercial processes that, left unaddressed, may generate further disputes in the future. The period after a resolved dispute is the right time to address those underlying issues, while the lessons of the dispute are fresh and the motivation to prevent recurrence is strong.

Common post-dispute improvements include updating or replacing inadequate commercial contracts, implementing shareholders’ agreements or governance arrangements that did not exist previously, improving communication and decision-making processes between business partners, and reviewing internal financial controls or transparency mechanisms that the dispute revealed to be inadequate.

A Post-Mediation Review

For businesses that conduct commercial mediations regularly, or for legal teams that attend mediations on behalf of clients, a structured post-mediation review is a valuable learning tool. What went well in the preparation? What would you do differently in the negotiation? What information did you have at the start of the mediation that turned out to be wrong or incomplete? What did the mediator do that was most effective? These questions, answered honestly, improve the quality of future mediation preparation and negotiation.

Published Resources

My book Winning in Commercial Mediation: A Business User’s Guide covers the post-mediation period in full, including implementation of settlement agreements, managing breaches, communicating outcomes internally, post-mediation reviews and preventing recurrence, with a full action checklist.

See all books.

Frequently Asked Questions

What should I do if the other party immediately starts renegotiating after signing?

A signed settlement agreement is legally binding and cannot be renegotiated unilaterally. If the other party purports to withdraw from or renegotiate a signed agreement, take legal advice immediately. The remedies available for breach of a settlement agreement are broadly the same as for breach of any commercial contract, including damages and, in appropriate cases, specific performance. The fact that the agreement was reached at mediation does not affect its enforceability.

Should I follow up with the mediator after the mediation?

Where the mediation did not result in settlement, the mediator may be willing to continue to assist the parties in reaching a resolution, whether through further facilitation, a follow-up session or simply by maintaining communication between the parties. If you think this might be helpful, you should contact the mediator. Where the mediation resulted in settlement, a brief communication to confirm that implementation is proceeding is courteous and maintains the relationship for any future dispute resolution needs.

How do I evaluate whether the mediation outcome was commercially beneficial overall?

The key test is whether the settlement was better than your BATNA: the realistic best alternative to a negotiated agreement if the mediation had failed. If the settlement achieved or exceeded your pre-mediation assessment of the realistic litigation outcome, taking into account all the costs and risks of litigation, it was commercially beneficial regardless of how it compares with your opening position or your initial aspirations for the dispute.

Get in Touch

If you need advice on implementing a mediated settlement, or if your dispute did not settle at mediation and you need guidance on next steps, I would be glad to help.

Call 020 4538 0246, use the contact form below, or book a call directly.

Important disclaimer: This page is provided for general information and educational purposes only and does not constitute legal advice. The content relates to the law of England and Wales only. Always seek independent legal advice from a qualified specialist before making decisions that affect your legal rights or commercial interests. The author accepts no responsibility for any decisions made or outcomes arising from use of this material. If you would like specific advice, contact me here.

Mediation – What Should I Consider After the Commercial Mediation?