Another pro-mediation move? UK Government considers ratification of the Singapore Convention on Mediation
On 1 April 2022, the UK’s consultation seeking views on whether it should sign and ratify the Singapore Convention on Mediation will close, and the government will consider whether to proceed with signing up to the Convention.
If it chooses to do so, the Convention will provide an alternative process for the enforcement by UK courts of international commercial settlement agreements resulting from mediations conducted anywhere in the world. Once the Convention becomes law these would be enforceable in the UK using the streamlined procedure under the Convention, as opposed to traditional enforcement by court proceedings for a breach of contract.
The Singapore Convention
The Convention came into force in 2020 and applies to international settlement agreements resulting from mediation, concluded in writing by parties to resolve a commercial dispute. There are some express exclusions from the scope of the Convention, including certain consumer agreements. Settlement agreements that are enforceable as judgments or as arbitral awards are also excluded, to avoid potential overlap with other conventions. Enforcement only requires the existence of the settlement agreement signed by the parties and evidence that the settlement agreement results from mediation. There are a limited number of grounds upon which a court may refuse to grant relief under Article 5, and a number of possible reservations (exceptions) which a Party can engage under Article 8 but taken as a whole the Convention simplifies the enforcement of settlement agreements in signatory states following ratification. To date 55 countries have signed the Convention and 9 have ratified it.
Impact of UK ratification
Generally, the Convention is likely to be a useful tool for claimants where a party is attempting to walk away from a settlement concluded in mediation and enforcement would otherwise be difficult given the location of assets. If enforcement can be sought in a Convention state, then this will prevent defendants frustrating the deal agreed at the mediation. This said, the Convention may be less impactful in the UK than might be expected. This is because parties based in the UK (or indeed elsewhere) can already enforce in jurisdictions that have ratified the Convention. Further, the English courts are already willing to enforce settlements resulting from foreign mediations, though enforcement proceedings are currently more onerous to pursue than the simpler procedure envisaged under the Convention.
The UK government’s proposal to enforce the Convention is further evidence of the pro-mediation climate in the UK, where mandatory ADR may be on the horizon (more info). It is true that the vast majority of mediated settlement agreements are performed without the need for enforcement action. This is perhaps unsurprising given that mediations succeed where it is in the parties’ commercial interests for disputes to end and therefore there is a strong incentive for parties to uphold their obligations under mediated settlement agreements.
Nonetheless, if ratified in the UK the Convention should serve as a useful new procedural tool for enforcement of mediated settlement agreements. This will provide additional reassurance for claimants that there is a more straightforward fall back enforcement mechanism for the rare occasion that the commercial incentives do not prove enough to dissuade non-compliance. In this way, the ratification of the Convention would be a positive step which along with other recent and forthcoming developments in mediation, would improve the efficacy of an already popular and effective ADR process in the UK.