Canada: Mediation: A Unique Tool for Resolving Construction Disputes

Last Updated: January 19 2006

By Robert W. Eden, Q.C. and Trish Morrison

Disputes on construction projects are hardly a new phenomenon, although their number and complexity have been increasing dramatically in recent years. This increase has begun to focus attention on alternative methods by which the industry can resolve disputes, as the delays and costs associated with the traditional resort to litigation have become more significant. In recognizing the cost and time commitment involved in litigation, and generally in the arbitration of major disputes, the industry has begun to turn more frequently to mediation as a remedy for resolution of disputes.

Mediation vs. Arbitration

Although they are commonly considered within the package of alternate dispute remedies, there are a number of significant differences between mediation and arbitration that are often misunderstood. Mediation is appropriate when the parties are prepared to compromise and are motivated to reach a timely and mutually satisfactory agreement with the help of a neutral person or where the parties plan to continue their relationship after the dispute has been resolved. Arbitration is more commonly used when feelings are such that the parties have no likelihood of being able to negotiate a settlement or retain a business relationship, and is appropriate if the parties need to reach a final decision.

A) Mediator vs. Arbitrator

In a mediation, the parties allow an outside mediator to assist them in negotiating a resolution. The mediator is a facilitator, rather than a decision maker. A good mediator possesses persuasive skills, as well as a basic knowledge of the subject matter of the dispute. By contrast, an arbitration occurs when parties in a dispute ask an outsider to listen to their facts and arguments and then to decide for them how the dispute must be resolved. An arbitrator should have a good working knowledge of the subject area in dispute.

B) Time Commitment

Mediation sessions are usually concluded within a few days. For more complex cases, mediation briefs are exchanged and given to the mediator in advance of the mediation session. By comparison, an arbitration will often involve considerable time for discovery of documents and limited examinations for discovery. The arbitration hearing usually lasts much longer than a mediation.

C) Cost

Mediation is much more cost effective than either litigation or arbitration. The three main cost components of mediation include internal business costs for preparation and attendance, the cost of lawyers or other advisors to prepare and attend, and the shared cost of the mediator and the session room. The arbitration process is more similar to litigation and often involves a longer process, presentation of evidence, possible discoveries, legal submissions and expert reports. This inevitably leads to significantly higher costs than a mediation.

D) Control

In a mediation, the parties maintain control over how the dispute will be resolved. A mediator has no authority to impose a settlement or to tell the parties how the dispute must be resolved. The parties must agree on the final outcome. In an arbitration, the final outcome is based upon the decision of the arbitrator and the parties do not have to agree with it.

The biggest advantage of mediation over arbitration is that it avoids the adversarial process and, therefore, preserves the business relationship. Mediation allows discussions to take place in a neutral environment, with an objective mediator, and will often accomplish more in a single session than during months of meetings and exchanging correspondence.

Mediation focuses more on the business interests of the parties than on their legal positions. By not dwelling on the different views of how the dispute arose, the parties are able to concentrate on creating a solution to their dispute. The mediator will assist the parties in identifying the strengths and weaknesses of their case and to discover the underlying interest that is at the heart of the dispute.

How to Achieve Successful Mediation

Not every mediation is successful. However, there are a number of factors that increase the possibility of achieving a successful mediation.

  • Ensure that each party is represented by someone having settlement authority, to allow a final settlement to be reached during the session.
  • Plan to spend a concentrated period of time in the mediation and do not plan on conducting other business during or between the mediation sessions.
  • Parties must be prepared to come to the table with an open mind.
  • Parties must have reasonably similar understandings about the issues.
  • Make sure there is sufficient information available - exchange mediation submissions, documents and relevant information.
  • Be prepared to address technical issues in the mediation - have an expert available to discuss any reports with the mediator and other party.
  • Discuss the concept of settlement and possible settlement options before coming to the mediation - think in advance about benefits that might be negotiated in addition to payment of monetary damages.
  • Resist setting a "bottom line" or "top dollar" settlement number until the mediator has had a chance to discuss the case with you.
  • Maintain a flexible attitude about the settlement options you bring with you. Reaching an agreement often means altering settlement proposals, either slightly or more significantly.
  • Determine objective and rationale bases for you settlement proposals.
  • Take into account the future avoided litigation or arbitration costs.
  • Leave open extra time in the event that the mediation sessions are constructive, but more time is needed.


Provided there is a common motivation to settle the dispute on a reasonable and timely basis, there is very little to lose and everything to gain through the mediation process.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions