Businesses find commercial disputes an unhelpful distraction from their operations, so their primary objective is to resolve and move on from disputes as quickly as possible. To do that, businesses demand final comprehensive resolution of their disputes with no ends untied, so to speak. Other important considerations for businesses are:
Time and cost efficiency: Disputes must be resolved efficiently in a timely and relatively inexpensive manner; and
Confidentiality: Businesses prefer that information about their disputes remain confidential.
The New Singapore Convention on Mediation has the potential to significantly increase the popularity of mediation cross-border disputes. At present, only arbitral awards (and, in some instances, court judgments) are readily enforceable across borders. If given effect in domestic legislation and ratified, the Singapore Convention will potentially offer businesses an additional means of obtaining a globally enforceable resolution of their disputes: through the conclusion of a mediated settlement agreement. Because litigation and/or arbitration between parties may be split across different fora (eg different courts and tribunals), settlement offers businesses the advantage of achieving a comprehensive resolution of all disputes through a single mediation, the outcome of which is memorialised in a single settlement agreement. This is likely to be very attractive to businesses.
That said, the success of any resolution reached through a mediated settlement agreement will depend on the quality of the agreement itself and the approach of the enforcement court. The drafting of the Convention leaves room for dispute at the time of the enforcement as to the propriety of the underlying mediation procedure and the proper interpretation of the settlement agreement. It remains to be seen as a practical matter whether parties with the assistance of a mediator will be able to draft and agree upon settlement agreements with terms having the necessary clarity and detail to be directly and specifically enforced by a court. When procedure and interpretation are disputed, there will be an adverse impact on not only the finality of the process, but on other core benefits of mediation such as time and cost efficiency. However, if the Convention is carefully implemented into domestic legislation and national enforcement courts enforce mediated settlement agreements under the Convention in good faith and a rational way, the Singapore Convention has the potential to make mediated settlement a powerful tool in the dispute resolution toolkit.