Procedure
Counsel and witnesses
Are the parties typically represented by lawyers in commercial mediation? Are fact- and expert witnesses commonly used?
It is standard practice that parties in commercial mediation are assisted by lawyers. In cases characterised by a high degree of (technical) complexity, it is also quite typical that the mediator is supported by expert witnesses. Fact witnesses are only rarely seen in commercial mediations.
Procedural rules
Are there rules governing the mediation procedure? If not, what is the typical procedure before and during the hearing?
For mediations falling within the scope of the Austrian Mediation Act or the Austrian EU Mediation Act, the procedural rules laid down in those statutes are only very rudimentary to provide the parties with a great degree of flexibility. They concern, inter alia:
the mediator’s duty to inform the parties about the process and its potential legal consequences;
the mediator’s duty to inform the parties on the form of the final mediation agreement and its enforceability;
the keeping of records regarding the commencement and termination of the mediation; and
confidentiality obligations.
In international commercial meditations, it is standard practice that the mediator requests the parties to submit position papers before the actual mediation session. The procedure is entirely in the hands of the mediator, who will, of course, take into account the parties’ wishes and needs. Against this background, the mediator will opt for caucus sessions if he or she considers it appropriate and in the interest of a successful outcome.
Tolling effect on limitation periods
Does commencement of mediation interrupt the limitation period for a court or arbitration claim?
Yes, the commencement of mediation does interrupt the limitation period for a court or arbitration claim. The commencement and the continuation of a mediation that is conducted by a mediator listed on the roster of mediators administered by the Austrian Ministry of Justice interrupts the limitation period such that it will not continue to run for the duration of the mediation and only resume (where it has left off) once the mediation has ended (section 22 of the Austrian Mediation Act). In mediations that fall within the scope of application of the Austrian EU Mediation Act, the mediation proceedings lead to a suspension of the expiration of the limitation period of the rights and obligations that are subject to the mediation proceeding (section 4 of the Austrian EU Mediation Act). If the mediation is conducted by a mediator that is not listed on the roster of mediators administered by the Austrian Ministry of Justice, the conduct of settlement negotiations per se leads to the suspension of the expiration of a limitation period (section 1497 of the Austrian Civil Code).
Enforceability of mediation clauses
Is a dispute resolution clause providing for mediation enforceable? What is the legal basis for enforceability?
Dispute resolution clauses providing for mediation are not enforceable in Austria. In other words, a non-compliant party cannot be forced to participate in mediation proceedings by way of a court order. Austrian legal doctrine is not unanimous as to the question of admissibility of a claim that is brought before a court despite a clear provision in favour of an initial mediation phase in a multi-tier dispute resolution clause. Some argue that observance of the mediation phase must not be seen as a sine qua non for the initiation of court procedures. Others propose that a valid agreement to mediate constitutes a temporary waiver of the right to file suit and that the court should either reject the claim as temporarily inadmissible or stay the proceedings. The Austrian Supreme Court has yet to issue a ruling on this pertinent question.
Confidentiality of proceedings
Are mediation proceedings strictly private and confidential?
Confidentiality is one of the most relevant principles governing mediation processes and must therefore be upheld at all times. As a basic rule, any information that was revealed during the mediation process shall remain confidential between the parties, unless they expressly waive confidentiality.
In accordance with the provisions of the ZPO and the StPO mediators may, under certain circumstances, not be heard as witnesses in court proceedings. Whether a mediator may refuse to give evidence essentially depends on whether he or she is listed on the roster of mediators administered by the Austrian Ministry of Justice:
Non-listed mediators who otherwise practise a profession that does not include elements of mediation are solely bound to confidentiality by the terms of the written mediation agreement entered into with the parties. They may not refuse to give testimony in court. Non-listed mediators who otherwise practise a profession that does include elements of mediation (eg, lawyers) may refuse to testify in court by reference to professional privilege and the relevant deontological rules.
Listed mediators are under a strict obligation of confidentiality. Therefore, mediators practising within the scope of application of the Austrian Mediation Act must not testify in court regarding any information that was imparted to them in their role as mediator.
Success rate
What is the likelihood of a commercial mediation being successful?
There is no available data as to the success rate of commercial mediation in Austria. However, according to a recent study published by the Centre for Effective Dispute Resolution (CEDR) approximately 70 per cent of all mediations conducted under the auspices of CEDR ended with a settlement on the day of the mediation session. Taking into account all other cases that settled shortly after the day of the mediation session, the percentage is about 90 per cent (CEDR, The Eighth Mediation Audit: A survey of commercial mediator attitudes and experience in the United Kingdom, CEDR, 2018, page 6). The significance of such statistics may be relative considering that cases brought to mediation are usually prone to a settlement solution. The CEDR statistics also appear to be quite reflective of the Austrian experience.
By Anne-Karin Grill and Dieter Heine