Project mediation is designed to help support the successful delivery of a project by identifying and addressing problems before they turn into disputes about payment and delay.
It enables conflict management and dispute resolution to be integrated into the contract as part of a collaborative contracting approach and can be used for almost any project but may be particularly appropriate for:
- PPP or long term contracts
- technically complex contracts
- contracts involving many contractors/sub-contractors/suppliers
- contracts sensitive to a history of poor contract performance and/or adversarial relationships
The benefits of project mediation are that it:
- offers a robust conflict management approach with a focus on dispute prevention
- shows that parties are taking collaborative working seriously
- is more flexible and cost effective than other conflict management mechanisms adopted at the outset of a project (such as a dispute resolution board)
- can be budgeted for in advance
As project mediation is integrated into the contract, it will be included as part of the contract procurement documentation. However, if it has not been included, the parties can still adopt project mediation.
Appointment of Project Mediators
Once the Core Parties have decided that they want to adopt project mediation for their project, we will assist them in identifying the project mediators.
We will appoint two trained Project Mediators who will be chosen on the basis of the mix of skills and professional backgrounds the parties think will be most appropriate for the project. On smaller projects, it may be more appropriate to have a single project mediator.
The parties will be charged a single appointment fee for both project mediators.
Protocol and Model Agreement
The CEDR Model Project Mediation Agreement incorporates the Model Project Mediation Protocol ("the Model Protocol"). The Project Mediation Agreement ("the Agreement") can vary the Model Protocol. The variations, if any, can be set out in the body of the Agreement or the Project Mediation Agreement can state the variations made in manuscript (or otherwise) on the incorporated Model Protocol.
To obtain a copy in PDF format click here.
The Model Protocol sets out the terms and conditions under which the contracting body and contractor (referred to as "the Core Parties") and any identified consultants, sub-contractors or specialist suppliers (referred to as "Key Suppliers") and the Project Mediators will follow. It provides a framework in which the Project Mediators can function to aid the early identification of actual or potential differences, disputes and claims and facilitate their resolution. The Model Protocol also refers to the CEDR Model Mediation Procedure in the event that the parties require a formal Mediation and includes, as Appendix 1, the Key Supplier Joining Agreement used to join in a new Key Supplier to the Project Mediation Agreement.
Key components and costs
Project mediation under CEDR consists of three components:
- Access to two Project Mediators for the duration of the project - at regular intervals one or both of the mediators will attend the project site to discuss progress and identify with the parties any actual or potential communication problems. Normally, the visit will coincide with the regular project or site meetings. The mediators may have discussions with the Parties or Key Supplier(s) together or separately to assist in the prevention of disputes or clarify the information requirements they need to address in a dispute prior to settlement discussions. The mediators also receive core documentation and review it during the course of the works.
Outside the site visits, it is for the parties to keep the mediators informed about any issues that might affect contract performance. The parties may call one or other of the mediators at any time to discuss project concerns and seek guidance.
Cost basis: monthly retainer and hourly rate for each Project Mediator. A daily rate is also agreed should the need arise, for example, for whole day site visits or a formal mediation [See (3) below].
- Project mediation workshop - Prior to contract commencement, CEDR in conjunction with the Project Mediators, will arrange a half-day project mediation workshop attended by all project decision-makers.
Cost basis: 'one off' fee.
- Formal mediation (if required) - Where the parties are unable to resolve their conflict through discussions and interventions by the Project Mediators, the parties may enter into a formal mediation conducted by the project mediators using the CEDR Model Mediation Procedure.
Cost basis: daily rate and pro rata hourly rate for additional hours related to the formal mediation.
All fees are shared equally by the Core Parties.