I was appointed mediator prior to the preparation and exchange of witness statements. The pleadings were very detailed; the parties had provided substantial witness statements in support of previously contested interim applications; they had an expert valuation of the business and its property assets and they had obtained some advice on how to model a tax efficient solution.  On the face of it, the mediation had good prospects of success.  However, the lawyers and I all knew it was far from straightforward.

The first day lasted over 14 hours.  The animosity was palpable.  The opening positions at the first joint meeting were firm and adversarial.  There was no prospect of the family reconciling.  The family was broken and the only solution was to agree the terms of B’s exit.  Not surprisingly the majority of the first day was focused on the anger between the parties.  The private discussions with the parties enabled them to vent their feelings.  Slowly and towards the end of the first day the parties felt able, albeit with great reluctance to make proposals to each other.  That said, the offers were aggressive and based on their antipathy towards each other.  They were not based on the reality/ merits of their positions.  At midnight an impasse was reached.  The gap between the parties was £900,000.  No one was prepared to budge.  I brought the mediation to an end.  It was very disappointing because the financial consequences of litigating to trial were potentially disastrous.

Over the next couple of weeks the lawyers and I canvassed the possibility of reconvening the mediation.  I wanted to reposition the debate, work through the detail and shape the dialogue towards a solution.  To progress, the parties had to move from the emotional “free for all” of the first day.  With some difficulty a second mediation day was arranged.

At the start of the second day I convened a meeting of the lawyers.  I proposed facilitating a series of joint meetings between the lawyers (not clients) on the key issues.  Each meeting would cover one issue and be interspersed with private discussions.  The parties agreed to adopt this approach.  An agenda was agreed and through the meetings the parties were able to reach some kind of consensus on the figures for the assets, liabilities, and respective shares.  We were then able to discuss the extremely contentious issue of alleged financial wrongdoing on the part of both B and C in the knowledge that the aforesaid financial issues had been considered.

We drifted into a third day.  At 3am we ended without settlement but with the parties now £300,000 apart and willing to reconvene that same evening for a further three hours (and no more).

The mediation continued that evening.  Further offers were exchanged.  At the expiry of the deadline the parties were £90k apart.  But the emotion was still burning and neither would budge.  I ended the mediation (without objection or request for further time from either party).  Privately, I thought in a day or so, the parties would realise the futility of arguing over £90,000 in what was a multi-million pound dispute and settle. My instinct was right.  The following day, through their lawyers the parties did agree in principle to split the difference between them.  Whilst the terms of a binding agreement and ancillary documentation had not yet been agreed the lawyers and I felt upbeat about a resolution.  It was agreed by all that it had been a tough mediation.

However, that was not the end.  Further financial analysis undertaken by the A, C and D suggested that the partnership liabilities had been understated by a substantial sum which if correct would possibly have a consequential effect on value of B’s shares in the company and partnership.

At the time of writing I understand that negotiations are continuing and I might be called in for day four.