UK becomes signatory to the Singapore Convention on Mediation
It is a potential consequence of any mediation that, even after overcoming all hurdles and reaching a binding agreement, one or more parties default on their obligations. Currently, the party seeking to enforce the agreement must bring court proceedings for breach of the agreement, resulting in further time and costs, especially if the matter involves international parties in alternate jurisdictions.
On 3 May 2023, the UK signed the United Nations Convention on International Settlement Agreements Resulting from Mediation (more commonly known as the Singapore Convention on Mediation).
Initially adopted by the General Assembly of the United Nations in December 2018, the Singapore Convention on Mediation (the “Convention”) provides a uniform and efficient framework for those states which have signed and ratified the Convention (a “State”) to enforce international settlement agreements arising from a mediation in another State.
At the time of writing (15 June 2023) the Convention has been signed by 56 countries with 11 having ratified the Convention so far.
When does the Convention apply?
In order for the Convention to apply, the settlement agreement arising from mediation must:
- be in writing;
- be binding and enforceable;
- include two or more parties who have their places of business in different States.
What types of agreement are excluded under the Convention?
The Convention relates to international commercial disputes only. It does not apply to settlement agreements concluded to resolve a dispute arising from:
- transactions engaged in by a consumer for personal, family or household purposes; or
- family, inheritance or employment law.
Any settlement agreements which have been approved in court proceedings and are enforceable as a judgment or as an arbitral award are also excluded from the Convention.
A State may also declare, on ratification, that the Convention shall not apply to settlement agreements to which the State or a governmental agency of that State is a party.
What will the process be under the Convention?
A party relying on the Convention to enforce a settlement agreement to which the Convention applies must supply a copy of the settlement agreement to the competent authority of the State in which relief is sought (i.e. the Court in the UK) along with evidence that the settlement agreement was the result of a mediation.
The competent authority may refuse to grant relief at the request of the defaulting party in a small number of exceptional circumstances.
What is the current process?
Until the Convention is ratified by the UK Government, any party to a mediation settlement agreement must continue to enforce said agreement by bringing a breach of contract claim against the defaulting party.
It can take a lot of time, effort and cost to obtain a court judgment and should the defaulting party continue to evade its obligations, the pursuer may find themselves having to pursue further court proceedings to enforce the court judgment once obtained. There may also be jurisdictional issues to contend with in cross-border agreements.
It is hoped that the ability to enforce a mediation settlement agreement under the Convention will reduce such lengthy timescales and costs, further demonstrating the UK’s dedication to alternative dispute resolution and keeping unnecessary litigation out of an already saturated justice system.
How we can help
Should you require any assistance in enforcing a settlement agreement arising from a mediation or otherwise our Dispute Resolution Team can help.
