EVALUATING THE EFFECTS OF THE ARBITRATION AND MEDIATION ACT 2023 ON MEDIATION PRACTICE IN NIGERIA THROUGH THE LENS OF THE LAGOS MULTI-DOOR COURTHOUSE (LMDC)

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Abiodun V. Ogunnubi v2

 

 

 

Abiodun V. Ogunnubi

 

  1. INTRODUCTION

The Arbitration and Mediation Act, 2023 (AMA) was signed into Law by the former President of the Federal Republic of Nigeria on 26th May 2023, making it the principal legislation that governs mediation in the country. Prior to May 2023, there was no national policy or legislation on mediation, however, some states of the federation, such as Lagos State, Enugu State, Rivers State, Bayelsa State, Ondo State, Kano State, etc. have laws on mediation.

The objective of the AMA as expressed in the explanatory memorandum is to ‘provide a unified legal framework for the fair and efficient settlement of commercial disputes by arbitration and mediation …’. The Act is divided into three (3) Parts. Part I relates to international and domestic arbitral proceedings in Nigeria, Part II provides for the practice of commercial mediation in domestic and international dispute settlement in Nigeria, and Part III covers Miscellaneous Provisions in the Act. The provisions of the AMA on mediation are adopted from the UNCITRAL Model Law on International Commercial Mediation and International Settlement Agreements Resulting from Mediation, 2018., This article seeks to examine the provisions of Part II of the AMA vis-à-vis the present legislative regime on mediation in Nigeria, an examination of the Lagos Multi-Door Courthouse (LMDC) Law to identify similarities and differences, as well as to proffer recommendations on likely amendments to the LMDC Law, if any.

  1. HIGHPOINTS OF PART II OF THE ARBITRATION AND MEDIATION ACT

The AMA in Sections 67 – 89 of the AMA replaced conciliation with mediation and recognized mediation as a dispute resolution mechanism, thereby establishing a substantive and procedural framework for mediation in Nigeria. Some of the notable provisions of the AMA are as follows: –

  1. Scope of the AMA on Mediation in Nigeria

Under the AMA, not all cases can be mediated, the Act explicitly identifies the class of cases that can be mediated under the AMA as well as the class of disputes to which the Act does not apply. The following category of cases can be mediated under the AMA – international commercial mediation; domestic commercial mediation; domestic civil mediation; domestic and international settlement agreements resulting from mediation and concluded in writing by parties to resolve a commercial dispute; and where parties agree in writing that Part II of the AMA should apply to the dispute. Conversely, Section 67(2) of the AMA itemises the class of disputes excluded from the scope of the Act.

  1. Timeframe and Numeration in responding to invitation for a mediation

Responding parties to an invitation to attend a mediation session are required to accept an invitation to mediate within 30days of being invited, and failure to respond may be treated as a rejection of the invitation to mediate. Also, only one mediator is expected to be appointed per case unless the parties agree otherwise.

  1. Virtual/ Online Mediation Sessions

The AMA recognizes the advancement in technology and provides for electronic conduct of mediation sessions and through similar means of digital transmission of voice and/or images, so long as the identity of participating parties are verified, and parties adhere to established principles of mediation.

  1. Immunity for mediators and mediation providers

Mediators and mediation providers are immune from liability for any act done or omitted in the discharge or purported discharge of their functions unless the act or omission is shown to have been done in bad faith.

  1. Suspension of limitation period

Upon commencement of mediation proceedings, the running of limitation period is suspended, i.e., the time between the commencement of the mediation proceedings and termination of proceedings is tolled.

  1. Enforceability of settlement agreements reached through mediation

Settlement agreements reached at mediation are binding on the parties and are enforceable in court as a contract, consent judgment or consent award.

  1. Enforcement of international settlement agreements in Nigeria

The AMA allows for the enforcement of international settlement agreements from mediation made in countries other than Nigeria, provided the foreign state is a party to the Singapore Convention and the dispute arose from a legal relationship that is contractual or considered commercial under Nigerian laws.

  1. Admissibility of evidence or testimony in other proceedings

Statements or admissions made during mediation, including documents and proposals made during mediation are inadmissible in arbitral or judicial or other proceedings.

  1. AN EXAMINATION OF THE ARBITRATION AND MEDIATION ACTVIS-À-VIS THE PRESENT LEGISLATIVE REGIME ON MEDIATION IN NIGERIA

Having examined some notable provisions of the AMA, it’s important to consider the existing framework for mediation in Nigeria, prior to the enactment of the AMA. The Lagos Multi-Door Courthouse (‘LMDC’ or (‘ADR Centre’) Law, 2015 will be the focus of this article. This is because the LMDC is the foremost court-connected ADR Centre in Africa offering disputants access to a range of alternative dispute resolution (ADR) mechanisms, such as arbitration, mediation, conciliation, early neutral evaluation, etc. The objective of the LMDC is to enhance access to justice by providing a standard legal framework that would ensure an effective justice system and efficient dispute resolution through ADR.

Pursuant to Section 30 of the LMDC Law, the Practice Direction on Mediation Procedure was enacted for the administration of mediation at the LMDC in 2008. The provisions of the LMDC Practice Direction on Mediation are similar to the provisions of the AMA, though enacted 15 years earlier. Some of the similarities are as follows:

  1. Referral of cases to mediation by parties,
  2. Suspension of limitation period, although, time will only be suspended under the practice direction if parties agree to such suspension of the statute of limitation,
  3. Appointment of one mediator by parties unless parties agree otherwise,
  4. Electronic conduct of mediation sessions through digital means,
  5. Mediation fees are to be equally borne by parties, however, the LMDC administers billing of parties, determines mediators’ fees and the mode of payment,
  6. Both modalities emphasize the twin pillars of confidentiality by the parties and the mediatoras well as the independence and impartiality of the mediator. However, the provisions of the AMA on confidentiality are more expansive and stipulate in Section 76 for instances where confidentiality would not apply.

Notwithstanding the above similarities, each has provisions that are unique to it, and examples of such differences are as follows:-

      1. The Role of ADR Judges at the LMDC

    Unlike the AMA where a party’s failure to respond to an invitation to mediate could be regarded as a rejection of the invitation to mediate, without more, the LMDC being a court-connected ADR Centre has in its practice direction on mediation provisions for designated ADR Judges to summon a refusing party to appear before the judge who is empowered to make the requisite orders for parties to mediate.

      1. Commencement Date

    The AMA in Section 70(5) clearly identifies the commencement date of the mediation process to be the date when parties signed the agreement to mediate after a dispute has arisen or the date a dispute was referred for mediation in a court-referred dispute, or the date the mediator took the first step to start the mediation process in other cases. However, there is no such clear provision in the LMDC Law or Practice Direction.

      1. Enforcement of Settlement Agreements

    While both the AMA and the LMDC Law provide that settlement agreements are binding and enforceable, enforcement of settlement agreements under the AMA extends to international settlement agreements made in other nations further to which the Convention on International Settlement Agreements resulting in Mediation would apply, where conditions for such are met. Furthermore, Sections 83 and 84 of the AMA provides the requirements to be met by a party seeking to rely on a Settlement Agreement as well as the grounds for refusal of such applications by the courts.

        1. Section 67(1) of the AMA defines the scope of cases that the Act applies to as well as the inapplicable case types, but the LMDC law has no similar provision.
        2. Production of a non-binding recommendation on terms of settlement

    The LMDC Practice Direction on Mediation permits a Mediator to provide parties with a non-binding recommendation on terms of settlement, at the request of the parties or their representatives, if they are unable to reach a settlement in the negotiations at the Mediation. Such recommendation is required to merely set out the appropriate settlement terms without attempting to anticipate what a court might order.

        1. CONCLUSION

    Part II of the AMA, 2023 established the framework for the administration of mediation in Nigeria, which will both promote the advancement of mediation as well as foster more confidence in the Nigerian economy. Furthermore, the AMA should enhance access to justice through mediation and similar ADR mechanisms, thereby serving as a springboard for the promotion of the Multi-Door Courthouses (MDCs) such as the LMDC. However, to achieve this, the MDCs will have to re-examine their enabling statutes and practice direction to ensure that they incorporate global best practices in their operations.

    In this respect, this author proposes a re-examination of some provisions of the LMDC Law, 2015 and its Practice Direction, to incorporate some of the applicable provisions that are missing, such as, circumstances when confidentiality can be waived in Section 76, the requirements a party seeking to rely on a Settlement Agreement is to supply to the court as stated in Section 83, together with the grounds for refusal of an application to rely on a Settlement Agreement as seen in Section 84 of the AMA.

    __________________________________

    For further information on this article and area of law,
    please contact Abiodun V. Ogunnubi at:
    S.P. A. Ajibade & Co., Lagos by
    Telephone (+234 1 472 9890), Fax (+234 1 4605092)
    Mobile (+234.809.790.4777, +234.818.449.2339)
    Email: aogunnubi@spaajibade.com
    www.spaajibade.com

    Footnote

      1. Associate in the Dispute Resolution Department at S.P.A. Ajibade & Co., Lagos, Nigeria.
      2. President Muhammadu Buhari.
      3. Lagos Multi-Door Courthouse Law, No 56, Vol 40, 2015; Enugu State Multi-Door Courthouse Law 2018; Rivers State Multi-Door Courthouse Law 2019; Bayelsa State Multi-Door Courthouse Law 2022; Ondo State Multi-Door Courthouse Law 2022; Kano State Arbitration Law.
      4. United Nations Commission on International Trade Law, Model Law on International Commercial Mediation and International Settlement Agreements Resulting from Mediation, as Adopted in 2018 (New York: United Nations, 2018) https://uncitral.un.org/sites/uncitral.un.org/files/media-documents/uncitral/en/22-01363_mediation_guide_e_ebook_rev.pdf accessed 2nd October 2023.
      5. The UNCITRAL Model Law was developed to provide uniform rules for international commercial mediation on such issues as confidentiality, evidentiary privilege and the exceptions to it, applicable regimes to settlement agreements and online mediation. Also, the UNCITRAL Model Law was recommended to States to incorporate into their national legislation, to preserve the integrity of mediation sessions but also to ensure uniformity – at Paragraphs 15 and 16, Pages 18 and 19 of the UNCITRAL Model Law.
      6. Section 67 of the AMA.
      7. Sections 70(1) & (2) and 72(1) of the AMA.
      8. Section 73(5) of the AMA.
      9. Section 81 of the AMA.
      10. Section 71(1) of the AMA.
      11. Section 82(2) of the AMA.
      12. Section 87 of the AMA.
      13. Section 77(1) of the AMA.
      14. See, https://lagosmultidoor.org/about-us/ accessed 2nd October 2023.
      15. Section 2 of the LMDC Law stipulates the ADR Centre’s objectives as follows: –

    a.To enhance access to justice by providing alternative mechanisms to supplement litigation in the resolution of disputes,
    b.minimize citizen frustration and delays in justice delivery by providing a standard legal framework for the fair and efficient settlement of disputes through ADR,
    c.serve as the focal point for the promotion of ADR in Lagos State; and
    d.promote the growth and effective functioning of the justice system through ADR methods.

    1. Article 2(a)(b) &(c) of the LMDC Practice Direction on Mediation and Section 70(1) of the AMA.
    2. Article 22 of the LMDC Practice Direction on Mediation and Section 71(1) of the AMA.
    3. Article 6(b) of the LMDC Practice Direction on Mediation and Section 72(1) of the AMA.
    4. LMDC Online Dispute Resolution Guidelines for Mediators and Section 73(5) of the AMA.
    5. Article 19 of the LMDC Practice Direction on Mediation and Section 73(7) of the AMA.
    6. Article 15 of the LMDC Practice Direction on Mediation and Section 75, 76 and 77 of the AMA.
    7. Article 7(b)&(c) of the LMDC Practice Direction on Mediation and Section 72(4) of the AMA.
    8. Article 4(b)& (c) of the LMDC Practice Direction on Mediation, Section 22 of the LMDC Law and Section 70(2) of the AMA.
    9. Article 17 of the LMDC Practice Direction on Mediation, Section 26 of the LMDC Law and Sections 82 -87 of the AMA.
    10. Article 16(d) of the LMDC Practice Direction on Mediation and Section 82(2) of the AMA
    11. Section 87 of the AMA.
    12. Section 3(1)(a) of the LMDC Law merely refers to the category of persons that can refer cases to the LMDC, including the High Courts and Magistrate Courts of Lagos State, Federal Courts, Courts from jurisdictions outside Lagos State, Private persons, Corporations, etc.
    13. Article 14(f) of the LMDC Practice Direction on Mediation.

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