International Commercial Mediation

Cyril Chern

• Publisher: Informa Law from Routledge
• Year: 2020
• ISBN:
  9781000341478
• Edition: 1
• Topic: Derecho
• Subtopic: Derecho mercantil

International Commercial Mediation is a practical guidebook that explains how to handle and complete a mediation, as well as how to personally market the skills developed as a mediator. The book provides examples, supplies forms, and explains procedures of actual working mediations which can be used to adapt to individual needs. It also deals with advanced practitioner issues and the emerging law on international mediation.

CHAPTER 1

MEDIATION FROM AN HISTORIC PERSPECTIVE

Historical Background

Mediation predates written history and legal scholars disagree as to when the first known example of mediation actually occurred. Each culture, however, shows evidence that mediation was used at some point in its development. As an example ancient Chinese literature tells the story of one Emperor who ruled over 4000 years ago. At that time the main city in China was under the reign of Emperor Shuen. His people had disputes and quarrelled with each other and their disputes became increasingly difficult to resolve other than through actual fighting. Those that lived in the mountains argued and fought over the borders of their land, the lake people argued and fought about the title to their homes, and those that lived along the riverbanks used the abundant clay to make pottery which unfortunately was defective so when sold caused even more problems and disputes. The Emperor just couldn’t come up with an easy solution to resolve all of the various disputes nor was he able to come up with an effective method for the prompt resolution of disputes when they arose. He decided that the best way would be to go out among his people, to live with them, to observe what it is that they did and to help them fashion some method of resolving their problems without the need for physical aggression. Ultimately he went to each of these areas to get to know the people better—he observed the farmers and farmed with them to see how their culture worked and to help determine why land disputes broke out, he fished with the fishermen to observe their practices and to see how and why problems arose, and he went to the people along the riverbanks to watch as they made pottery and to see if he could find a solution to why they were having their problems.

He observed the people in each region and saw what they were doing and more importantly he observed exactly how the fights and arguments erupted. Based upon what he saw and his newly acquired knowledge of their customs and practices he was able to counsel the people and help them resolve their various disputes. He then started to instruct the regional people in methods to prevent the continuation of disputes and after about a year of this instruction “the mountain dwellers started offering their lands to each other; the lakeside residents started conceding their houses to each other; and those living along the rivers started making and selling pottery of a very good quality.”¹ In essence he brought mediation to the people. This is one of the earliest stories in which the concept of mediation, i.e. counselling people so that they could come up with a way to peacefully settle their own disputes, first arose.²

Ancient Cultures

What is commonly known as mediation has beginnings in every ancient culture. Historians have found early cases in both Phoenician (1200 BC to 900 BC) and Babylonian commerce (2300 BC). Mediation also developed in Ancient Greece, then in Roman law where Justinian’s Digest (530–533 BC) recognized mediation. Indeed some of the early cultures regarded the mediator as a sacred figure, worthy of particular respect with the role partly overlapping that of the traditional wise man or chief.

Roman literature used a variety of names, including internuncius, medium, intercessor, philantropus, interpolator, conciliator, interlocutor, interpres, and finally mediator to describe both the role and the concept of mediation and over time various cultures developed scholarly literature on the subject of mediation.

In Europe, scholarly mediation literature existed as early as 1680, when Johann Wolfgang Textor described essential international mediation standards.³ In the United States, Native Americans adopted their own dispute resolution procedures long before the American settlement. Indeed recently, the Navajo have begun using the ancient alternative dispute resolution (ADR) practise of Hozhooji Naat’aanii, which was practised until the still new US government first imposed its own legal system on the Navajo in 1829.⁴

Early China

Going back to Chinese history one finds detailed accounts of mediations and mediators as we now know them going back at least 2700 years. Early examples include that of Wu You, a county officer from the Western Han dynasty (206 BC-24 AD), “of whom it was recorded that whenever he had lawsuits to judge, always began by closing his door to reflect on his own negligence, for he believed that if he had instructed his people well in ethics, they would never quarrel with each other. He then stated the reasons clearly to his people, and often went into the streets and homes personally, to persuade his people to become reconciled” or Lu Jiouyuan, a local Confucian officer in the Northern Song dynasty⁵ (960–1127), who always tried to bring together parties who were in a dispute and counselled them to “make peace among themselves in accordance with Confucian morality”. History records that sometimes people were so moved by him that they tore up their complaints and reconciled with each other.

These early forms of mediation, based upon ethical trade and relations, became popular as a way to settle disputes and were upheld by the then governors because they felt that harmony and “no litigation” was the ideal social order.

The avoidance of litigation was in fact a goal supported by the religious and philosophical leaders of the time. Confucius wrote: “Although I listen to the cases as other judges do, I must make my best effort to instruct people to live without litigation.” According to him “no litigation” meant that all the people were guided ethically by the instruction of morality, and that this should be the duty and ultimate aim of their governors. At that time one of the main goals for the local governors was to have no lawsuits in their region, as this was a way to show that they had good ethical relations in their community. Conversely if lawsuits started in their region it would damage their reputation and position and cause them to be branded as vulgar and immoral. Needless to say this did not predispose any governor to promote litigation and this ultimately led to parties mediating their disputes rather than going to the governors or to litigation. Individual families who had disputes would also, as a result, choose to mediate disputes by themselves rather than allow the dispute to be sent to the government. This concept of preventing litigation to maintain one’s reputation either individually or as a governor led to the traditional practise of many big families who developed their own family rules instructing their descendants not to be involved in litigation in order to keep the family’s reputation.⁶

In the Ming dynasty, the tradition of mediation among family clans and local communities was written in the official code: “Each village should build up the ‘shenming’ pavilion” (“shenming” in Chinese means “making reasons clearly”).⁷ It was here in the “making reasons clearly” pavilion that the respected local elders and intellectuals would listen to the grievances and act as mediators/judges and assist the parties in reaching a peaceful solution.

Qing Dynasty—Three Steps of Mediation

After 3,600 years of mediation history the “Three Steps of Mediation in the Qing Dynasty”⁸ (1644–1911) developed.

The First Step

The first step was the “private settlement” before litigation. The traditional method of resolving disputes was to seek the counsel of either the head of the family clan or the head of the local village rather than resort to litigation. Indeed, many times it was the community that compelled the arguing parties to do this rather than their doing so voluntarily. Even if one of the parties had started litigation by sending their complaint to the county government they were still required to accept the decision made by the local intercessor as the local government officers encouraged this sort of mediation towards settlement rather than judge the cases themselves.⁹

There are many written reports during this era as to the mediator/intercessor’s role in settling disputes. An early example can be found in the following story, which appeared in a report, by the intervenors in a file of the legal branch of the Baodi County government during the Qing dynasty.¹⁰ A widow living in Huang Chun sued the local county officer stating that her dead husband’s cousin had taken her land. When her six relatives learned that these members of their family clan were in a dispute, they “could not be at ease as bystanders”, so they “intervened between the parties voluntarily”. They began their own investigation to sort out the real facts and found from the land deed, that the widow’s dead husband had mortgaged the disputed land to a cousin, and as it turned out the widow was too poor to redeem the property. In what appears to be a group mediation, they persuaded their cousin, “to take into account the feelings of relatives and help the widow and the orphan as much as possible.” In the end, after the “mediation” the cousin who had been holding the mortgage voluntarily offered to convey back the land to the widow “out of respect for the feeling of the family clan and of consanguinity.” Then as witnessed by the relatives, the two parties ‘’saluted each other” (meaning that they resumed good relations), transferred the land back by deed and made a written agreement which stated: “From today the two parties should keep each property, never to argue, and should both maintain the harmony of the family clan.” When these six relatives reported with all of their names to the local government asking for withdrawal of the lawsuit, the head of the county government remarked on their report: “As this case has been mediated by the relatives, I approve of your withdrawal of the lawsuit in order to encourage keeping your sense of kinship arising from a common family origin.”

The Second Step

The second step of mediation in the Qing Dynasty occurred after the local bureaucrat received and read the complaint sent by people from a village. Once read, the local bureaucrat returned the complaint to the head of the village to conduct the mediation. This process was used for small disputes or offences among relatives and neighbours. More serious cases had to be dealt with by the official himself. When the local bureaucrat returned the complaint, he would write instructions on the complaint as follows: “Since the cause is slight,” or “As the dispute concerns family clan matters,” “I nominate the relative (or chief of the family clan, or head of village) to mediate in order to discourage unnecessary litigation” and returned the complaint to the village. The bureaucrats only judged cases that could not be settled at the village¹¹ level.

The Third Step

The third step was a formal mediation process conducted by the chief governmental officers. An example written by Kuai Zifan, a local chief officer in the Qing dynasty,¹² tells about a peasant who sued his aunt for beating him after he had refused to lend her money. After checking the plaintiff’s very minor wound, Zifan said to him: “As you are so poor and your aunt still needs to borrow from you, she must be poorer than you. If both of you were involv...