Bankside Chambers and Bankside Singapore mediator and arbitrator Hon Paul Heath KC recently delivered a keynote address at the INSOL London 2026 ADR Colloquium on the fundamental principles for the use of mediation in commercial settings, how mediation can be conducted in commercial disputes, and its interaction with judicial decision-making. We speak with Paul about his presentation, the evolution of mediation in complex insolvency and restructuring matters, and the lessons commercial litigators can draw from international ADR approaches.
Hi Paul, let’s start with INSOL International and your role as co-chair of the ADR Colloquium. What is the purpose of the ADR Group?
INSOL International is a global network for professionals working in insolvency, restructuring, and turnaround. They established the ADR Colloquium in 2022 to encourage the use and development of mediation, arbitration, and other alternative dispute resolution processes within the insolvency and restructuring sector.
My role as co-chair primarily focuses on arrangements for annual conferences or seminars, searching out speakers and looking for opportunities at which INSOL can promote its work in this area in conjunction with other professional groups. For example, both the Singapore International Arbitration Centre and the London Court of International Arbitration have supported our programmes on different occasions.
You began your keynote address with the fundamental principles for the use of mediation in commercial settings. What are these fundamental principles?
Mediation is a process that is designed to enable parties to find their own solutions to a problem rather than await the decision of a court or arbitrator which will impose a solution on them. The essential elements of a mediation are the appointment of a skilled independent person to facilitate discussion among the parties at a meeting which is both confidential to the parties and without prejudice in nature; meaning that nothing said in the mediation can be used against a party if the case proceeds to court or arbitration.
Another element is the ability to caucus with parties separately to explore solutions which may be appropriate for them. Nothing said in those meetings can be disclosed to the opposing party without express consent. Finally, but importantly, the mediator is a facilitator; they are not a decision-maker or an adviser to the parties.
Are there types of commercial disputes that are well suited, or unsuited, to mediation?
Commercial disputes between entities that will continue to have a business relationship are particularly well suited to mediation, particularly when speed of resolution is necessary to maintain or salvage that relationship. Often, such problems can be resolved by solutions that a court could never order. While most disputes are suitable for mediation, those which are not suitable tend to involve multiple parties, not all of whom can readily attend a mediation meeting. When arranging a mediation, it is important that everyone who needs to consent to a settlement is present or represented and has authority to settle.
Would you say that mediation supplements or enhances judicial decision-making?
Mediation does not necessarily enhance judicial decision-making. Its benefit is in narrowing issues to reduce the time that it is likely to take to have cases heard on a defended basis or removing the need for a determinative process completely. In the context of cross-border insolvency cases, mediation can enhance the Court’s ability to deal quickly with real-time litigation where agreements can be reached to limit the issues for which the Court’s time will be required (potentially reducing, for example, a five day hearing to a one day hearing) and to address questions of a commercial nature rather than a strictly legal one – for example, the valuation of claims for the purposes of voting at a meeting of creditors convened to consider a restructuring plan.
How has the use of mediation evolved in complex insolvency and restructuring disputes over the past ten years?
Mediation has been used extensively over the past ten or so years in the cross-border insolvency area, though it is still developing.
The UNCITRAL Model Law on Cross Border Insolvency has been adopted in many States, including New Zealand. It requires Courts in different States to communicate and co-operate with each other to ensure distributions to creditors are made as quickly as possible. One of the provisions entitles a Court to appoint a person to act at the direction of the Court to co-ordinate necessary steps. That power can be used to appoint a mediator or mediators to facilitate resolution of particular issues among parties who are likely to be in different countries.
Although occurring more than ten years ago, a good example is the Lehman Brothers bankruptcy proceeding in the USA. The Bankruptcy Court in New York was supervising a cross-border proceeding involving many different jurisdictions. One of the international issues involved 1.2 million derivative transactions with 6,500 counterparties. Permission was obtained from the US Bankruptcy Court to mediate those disputes. Ultimately, Lehman was able successfully to reach settlement in 93 of the 98 mediated cases, resulting in a sum of $1.39 billion being made available to creditors. That example demonstrates how useful mediation can be in resolving disputes more quickly than a Court could do. Courts have been building on that and similar examples.
What lessons can commercial litigators take from international approaches to ADR?
The first point is that mediation is not litigation. Lawyers who go into mediation thinking that everyone will be convinced to settle on their terms because their view of the law is correct will often make it more difficult for the mediator to facilitate a settlement. The mediation process is about listening to each other, assessing the risks of proceeding to a Court hearing and limiting the amount of costs payable in resolving the dispute.
Also, in my view, the parties (usually through their advisers) must get away from the idea that the first party to suggest mediation is showing a sign of weakness, rather than initiating discussions that should lead to a more timely and cost-effective solution. An attempt to resolve a problem in a timely manner, taking account of risks of litigation and lessening the cost for a client should never be seen as a sign of weakness.
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