Shippers increasingly opt for mediation over litigation

Just months since its April launch, the African Commercial Dispute Settlement Centre (ACDSC) is seeing a gradual increase in calls for its services to resolve disputes outside of court through mediation and arbitration. It’s a partnership between the Cape Chamber of Commerce, the Stellenbosch University Business School, and Equillore, a provider of commercial dispute settlement services to offer business a viable alternative to litigation in resolving commercial disputes. According to Advocate Louis van Wyk of Equillore, the Centre has already handled several cases successfully while more are being referred to it from local government level. Business is also starting to see its value, he said. “In a recent case, a manufacturer was taken to court by one of its buyers for not being able to supply enough product. As a result, contracts could not be fulfilled. After being on the court roll for three years, the matter was finally referred for mediation. And once in a neutral setting the manufacturer, who was facing a claim of R1.8 million from the buyer, had the chance to explain why he could not meet the demand.” Van Wyk says the final solution lay in the buyer investing R5 million in the company he had been suing for three years. “There is also great value in mediation for exporters through the ACDSC as it operates across the continent,” he said. “Mediation is all about logical outcomes that benefit all the parties involved. Commercial disputes by their very nature are business problems and when you go to a lawyer, you make it a legal problem.” Van Wyk said this immediately resulted in a lengthy and costly process. “Mediation simply allows for two businessmen to sit down and face each other, with a third person to control the emotions and allow for them to see the deal.” The mediation process developed for the Centre consists of two processes, said Van Wyk. The first is a conciliation process, which is capped in terms of price and time. For R3950 a mediator is appointed and the case is heard within two hours. The second process is slightly longer and can include arbitration. But, says Van Wyk, at least 80% of all cases heard in mediation are settled within a two-hour period. “Also, once mediation has resulted in a solution, the outcome can be made an order of the court simply by presenting it to a Judge for rubber-stamping.” He said it was important for importers and exporters to ensure they had the necessary clauses in contracts to ensure that mediation could take place should a dispute exist. “The Chamber of Commerce has the necessary information and clauses for contracts available from its website, and simply by cutting and pasting you can save yourself a lot of money by preventing litigation that can be costly and lengthy.” He said mediation also often brought about a more acceptable resolution than litigation would. CAPTION Louis van Wyk … ‘ACDSC operates across the continent.’