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Model Mediation Clause Recommended by ACCORD

        Including a mediation clause in a contractual agreement ensures that the parties will be obligated to first mediate any dispute that arises prior to pursing their remedies in court or through arbitration.  ACCORD has reviewed countless versions of mediation clauses; some are too short; others are overly complex or cumbersome and lack flexibility.

        ACCORD has carefully drafted the following mediation clause which can be inserted into virtually any contract on a stand alone basis.  The language is sufficiently specific to provide a clear structure to compel mediation, but general enough to provide flexibility.  We highly recommend adding the following language to your contractual agreements if you wish to preserve your opportunity to use mediation to resolve any potential disputes with the other party to the contract.

MEDIATION

  1. The parties agree to attempt to resolve  any dispute, claim or controversy arising out of or relating to this Agreement by mediation, which shall be conducted under the then current mediation procedures of The CPR Institute for Conflict Prevention & Resolution or any other procedure upon which the parties may agree.    The parties further agree that their respective good faith participation in mediation is a condition precedent to pursuing any other available legal or equitable remedy, including litigation, arbitration or other dispute resolution procedures.

  2. Either party may commence the mediation process by providing to the other party written notice, setting forth the subject of the dispute, claim or controversy and the relief requested.  Within ten (10) days after the receipt of the foregoing notice, the other party shall deliver a written response to the initiating party's notice.  [OPTIONAL PROVISION: The mediation shall be conducted by ___________ with its principal offices located at __________].  The initial mediation session shall be held within thirty (30) days after the initial notice.  The parties agree to share equally the costs and expenses of the mediation (which shall not include the expenses incurred by each party for its own legal representation in connection with the mediation ).

  3. The parties further acknowledge and agree that mediation proceedings are settlement negotiations, and that, to the extent allowed by applicable law, all offers, promises, conduct and statements, whether oral or written, made in the course of the mediation by any of the parties or their agents shall be confidential and inadmissible in any arbitration or other legal proceeding involving the parties; provided, however, that evidence which is otherwise admissible or discoverable shall not be rendered inadmissible or non-discoverable as a result of its use in the mediation.

  4. The provisions of this section may be enforced by any Court of competent jurisdiction, and the party seeking enforcement shall be entitled to an award of all costs, fees and expenses, including reasonable attorneys’ fees, to be paid by the party against whom enforcement is ordered.

 

Other Examples of Mediation and ADR Clauses

    The CPR Institute for Conflict Prevention & Resolution (www.cpradr.org), based in New York City, is a non-profit organization dedicated to increasing the use of alternative dispute resolution among corporate parties.  CPR was founded in 1979 as the Center for Public Resources from a coalition of leading General Counsel dedicated to identifying and applying appropriate alternative solutions to disputes to mitigate "the extraordinary costs of lengthy court trials." CPR has prepared a number of contractual clauses that may be of helpful to the legal draftsman.  Although these form clauses are closely tied to CPR's services, CPR's sample  language includes a number of different provisions covering the spectrum of available ADR options.   Certain of CPR's model clauses are set forth below.

 

A. CPR Model "Multi-Step" Dispute Resolution Clauses

    This section offers a detailed multi-step clause and a variety of drafting options for domestic agreements. (See International ADR for International Models.)  If no binding resolution clause is included, litigation, by default, would remain the means of dispute resolution.

PREAMBLE

"Any dispute arising out of or relating to this Agreement shall be resolved in accordance with the procedures specified in this Article 00, which shall be the sole and exclusive procedures for the resolution of any such disputes."

NEGOTIATION

"(A) The parties shall attempt [in good faith] to resolve any dispute arising out of or relating to this [Agreement] [Contract] promptly by negotiation between executives who have authority to settle the controversy and who are at a higher level of management than the persons with direct responsibility for administration of this contract. Any person may give the other party written notice of any dispute not resolved in the normal course of business. Within [15] days after delivery of the notice, the receiving party shall submit to the other a written response. The notice and response shall include (a) a statement of that party's position and a summary of arguments supporting that position, and (b) the name and title of the executive who will represent that party and of any other person who will accompany the executive. Within [30] days after delivery of the initial notice, the executives of both parties shall meet at a mutually acceptable time and place, and thereafter as often as they reasonably deem necessary, to attempt to resolve the dispute. [All reasonable requests for information made by one party to the other will be honored.]

All negotiations pursuant to this clause are confidential and shall be treated as compromise and settlement negotiations for purposes of applicable rules of evidence."

MEDIATION

"(B) If the dispute has not been resolved by negotiation as provided herein within [45] days after delivery of the initial notice of negotiation, [or if the parties failed to meet within [30] days after delivery], the parties shall endeavor to settle the dispute by mediation under the CPR Mediation Procedure [then currently in effect OR in effect on the date of this Agreement], [provided, however, that if one party fails to participate in the negotiation as provided herein, the other party can initiate mediation prior to the expiration of the [45] days.] Unless otherwise agreed, the parties will select a mediator from the CPR Panels of Distinguished Neutrals."

ARBITRATION

"(C) Any dispute arising out of or relating to this [Agreement] [Contract], including the breach, termination or validity thereof, which has not been resolved by mediation as provided herein [within [45] days after initiation of the mediation procedure] [within [30] days after appointment of a mediator], shall be finally resolved by arbitration in accordance with the CPR Rules for Non-Administered Arbitration [then currently in effect OR in effect on the date of this Agreement], by [a sole arbitrator] [three independent and impartial arbitrators, of whom each party shall designate one] [three arbitrators of whom each party shall appoint one in accordance with the ‘screened' appointment procedure provided in Rule 5.4] [three independent and impartial arbitrators, none of whom shall be appointed by either party]; [provided, however, that if one party fails to participate in either the negotiation or mediation as agreed herein, the other party can commence arbitration prior to the expiration of the time periods set forth above.] The arbitration shall be governed by the Federal Arbitration Act, 9 U.S.C. §§1 et seq., and judgment upon the award rendered by the arbitrator(s) may be entered by any court having jurisdiction thereof. The place of arbitration shall be [city, state]."

LITIGATION CLAUSE

(C) “If the dispute has not been resolved by nonbinding means as provided herein within [90] days of the initiation of such procedure, this Agreement does not preclude either party from initiating litigation [upon 00 days written notice to the other party]; provided, however, that if one party has requested the other to participate in a nonbinding procedure and the other has failed to participate, the requesting party may initiate litigation before expiration of the above period.”

ADDITIONAL CPR MODEL CLAUSES

Additional Negotiation Step Option

"If the matter has not been resolved by these persons within [45] days of the initial notice, the dispute shall be referred to more senior executives of both parties who have authority to settle the dispute and who shall likewise meet to attempt to resolve the dispute." 

Stand-Alone Mediation Clause

"The parties shall attempt in good faith to resolve any dispute arising out of or relating to this Agreement promptly by confidential mediation under the then current Mediation Procedure of the [then currently in effect OR in effect on the date of this Agreement], before resorting to arbitration or litigation. Unless otherwise agreed, the parties will select a mediator from the CPR Panels of Distinguished Neutrals." 

Negotiation-Mediation Clause with Designated Mediator Option

"If the dispute has not been resolved by negotiation as provided herein within [45] days after delivery of the initial notice of negotiation, [or if the parties failed to meet within [30] days], the parties shall endeavor to settle the dispute by mediation under the CPR Mediation Procedure [then currently in effect OR in effect on the date of this Agreement], [provided, however, that if one party fails to participate as provided herein, the other party can initiate mediation prior to the expiration of the [45] days.] The parties have selected [insert name] as the mediator in any such dispute, and [he][she] has agreed to serve in that capacity and to be available on reasonable notice. In the event that [insert named mediator] becomes unwilling or unable to serve, the parties have selected [insert name] as the alternate mediator. In the event that neither persons is willing or able to serve, the parties will agree on a substitute with the assistance of CPR. Unless otherwise agreed, the parties will select a mediator from the CPR Panels of Distinguished Neutrals."

 Stand-Alone Arbitration Clause

"Any dispute arising out of or relating to this contract, including the breach, termination or validity thereof, shall be finally resolved by arbitration in accordance with the CPR Institute for Dispute Resolution Rules for Non-Administered Arbitration [then currently in effect OR in effect on the date of this agreement], by (a sole arbitrator) (three arbitrators, of whom each party shall appoint one) (three arbitrators, of whom each party shall designate one in accordance with the ‘screened’ appointment procedure provided in Rule 5.4) (three arbitrators, none of whom shall be appointed by either party). The arbitration shall be governed by the Federal Arbitration Act, 9 U.S.C. §§ 1 et seq., and judgment upon the award rendered by the arbitrator(s) may be entered by any court having jurisdiction thereof. The place of arbitration shall be (city, state)."

 CPR Model Minitrial Clause

“The parties will attempt in good faith to resolve any dispute arising out of or relating to this Agreement in accordance with the CPR Minitrial Procedure [then currently in effect OR in effect on the date of this Agreement] and will enter into an initiating agreement in the form annexed to such Procedure.”

 Mediation and Arbitration  ("Med-Arb")

"The parties shall endeavor to resolve any dispute arising out of or relating to this Agreement by mediation under the CPR Mediation Procedure [then currently in effect OR in effect on the date of this Agreement]. Unless the parties agree otherwise, the mediator will be selected from the CPR Panels of Distinguished Neutrals. Any controversy or claim arising out of or relating to this Agreement, including the breach, termination or validity thereof, which remains unresolved [[45] days after initiation of the mediation procedure] [[30] days after the appointment of a mediator], shall be finally resolved by arbitration in accordance with the CPR Rules for Non-Administered Arbitration [then currently in effect OR in effect on the date of this Agreement], by [a sole arbitrator] [three independent and impartial arbitrators, of whom each party shall designate one] [three arbitrators of whom each party shall appoint one in accordance with the ‘screened’ appointment procedure provided in Rule 5.4] [three independent and impartial arbitrators, none of whom shall be appointed by either party]; [provided, however, that if one party fails to participate in the mediation as agreed herein, the other party can commence arbitration prior to the expiration of the time periods set forth above.] The arbitration shall be governed by the Federal Arbitration Act, 9 U.S.C. §§ 1 et seq., and judgment upon the award rendered by the arbitrator(s) may be entered by any court having jurisdiction thereof. The place of arbitration shall be (city, state)."

©  CPR Institute for Conflict Prevention & Resolution

For more information on CPR's model clauses, visit  CPR Model ADR Clauses.


 

American Arbitration Association Dispute Resolution Clauses

    Although its booklet deals primarily with arbitration, the American Arbitration Association offers a publication intended to assist parties in drafting alternative dispute resolution clauses.  Drafting Dispute Resolution Clauses - A Practical Guide provides suggested mediation clauses, a checklist of considerations for the drafter, as well as examples of supplemental language which go beyond the basic clauses. The booklet can be downloaded without charge.
 

 

Copyright © 2007 by Accord ADR Services .  All rights reserved.  "ACCORD" is a service mark of Accord ADR Services.
 


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