Court refuses to uphold mandatory mediation clause

Posted On August 23, 2011
In Mediation / Reply

The Federal Magistrate’s Court recently refused to stay proceedings in a case brought by a party that had failed to comply with a mandatory mediation clause.  The case shows that even though a party to a contract may have promised to not commence legal proceedings until it had first engaged in mediation, the court will not always require it to do so. Factors that weigh in favour of not requiring compliance with the mediation clause include: the dispute involves entities beyond the other party to the contract, the issues in dispute go beyond those based on the contract, and the dispute has been on foot for a number years already. Source: Lexology

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