Law and policyDefinitions
Is there any legal definition in your jurisdiction of the terms ‘ADR’, ‘conciliation’ and ‘mediation’?
The Lagos State Multi-door Court Law 2007 defines ‘alternative dispute resolution’ to include the entire range of alternatives outside the courtroom that involve third-party intervention to assist in the resolution of a dispute.
It also defines ‘mediation’ as the voluntary process for resolving disputes with the assistance of a neutral third party who facilitates dialogue between disputing parties and helps them privately and collectively to identify the issues in dispute, reach settlement of the dispute and mutually accept the settlement.
Conciliation is generally understood to mean the process for resolving disputes with the aid of a neutral person who plays a relatively direct role in the resolution process between disputing parties by advising them on possible solutions and driving them towards a satisfactory resolution of the dispute.Mediation models
What is the history of commercial mediation in your jurisdiction? And which mediation models are practised?
The formal concept of mediation as an alternative dispute resolution (ADR) mechanism is still a relatively new, growing concept. However, it has existed informally, along with other dispute resolution mechanisms such as negotiation, within the traditional societies of Nigeria for several years. For example, many societies have a committee of elders, family heads, chiefs or emirs who presided over and sought to resolve disputes between parties. Often, these mediators (especially when they were not leaders within their communities) were chosen for their respectability in society and their knowledge of the laws and customs of the land.
Although mediation as a formal concept is still not very popular in all parts of Nigeria, with the developing prominence of ADR mechanisms in general, there is an increase in the awareness and use of mediation as an alternative to litigation, or more commonly, as an initial step before the use of other more binding ADR mechanisms, such as arbitration.
The facilitative model of mediation is the most commonly used in mediation proceedings in Nigeria.Domestic mediation law
Are there any domestic laws specifically governing mediation and its practice?
There are very few laws that provide for mediation. Nigeria’s most significant law on ADR, which applies to the whole country, is the Arbitration and Conciliation Act, Cap A18, LFN 2004. This law provides for arbitration and conciliation but makes no express provision for mediation.
Nigeria operates a federal system of government with legislative powers vested in both the national (federal) and the constituent state levels. Laws in respect of ADR mechanisms, including mediation, can, therefore, be enacted at the federal or state levels. Accordingly, while there are no federal laws specifically governing mediation across the entire country, some of the states that are major commercial centres, such as Akwa Ibom State, the Federal Capital Territory, Rivers State (Port Harcourt), Delta State, Kano State, Cross River State, Edo State, Enugu State, Ogun State and, most significantly, Lagos State have laws on mediation.
In Lagos State, for example, the domestic sources of law that relate to mediation include the Lagos State Multi-Door Court Law 2007 and the accompanying Lagos State Multi-Door Court (LMDC) Practice Directions on Mediation, the Citizens Mediation Centre Law 2007 and the Lagos Court of Arbitration’s (LCA) Mediation Guidelines 2011. Further, the procedural rules of some state courts also contain sparse provisions on mediation, which generally encourage referrals of disputes before these courts to mediation, among other ADR mechanisms.Singapore Convention
Is your state expected to sign and ratify the UN Convention on International Settlement Agreements Resulting from Mediation when it comes into force?
Nigeria has not signified whether it will ratify the UN Convention on International Settlement Agreements Resulting from Mediation. Being a signatory to the UNCITRAL Model Law on International Commercial Arbitration, it is, however, likely that Nigeria will ratify the UN Convention when it comes into force.Incentives to mediate
To what extent, and how, is mediation encouraged in your jurisdiction?
Nigerian courts greatly encourage the amicable settlement of disputes by any of the ADR mechanisms, including mediation. It is an established principle under the Nigerian jurisprudence that even where a matter has been filed in court, the parties are not precluded from exploring avenues for amicable settlement of their grievance out of court. Thus, Nigerian courts encourage parties to amicably settle their disagreements and thereafter, if they choose, inform the court of the outcome of the settlement. The settlement terms can then be adopted as a consent judgment by the court. Ideally, no Nigerian court will insist or compel the parties to litigate their dispute where there is room for amicable settlement.Sanctions for failure to mediate
Are there any sanctions if a party to a dispute proposes mediation and the other ignores the proposal, refuses to mediate or frustrates the mediation process?
Under the LMDC Practice Directions on Mediation, for example, where a party refuses to submit to mediation, the ADR judge will request the refusing party to appear before him or her. Where the party further refuses to appear before the ADR judge, the non-appearance will be treated as contempt of court and the ADR judge has the power to give orders that include fines, cost in monetary terms or as may be considered appropriate in the circumstances.
Furthermore, a report to the court (particularly in circumstances where a court has ordered the parties to explore settlement) that a party refused to submit to, participate in, or frustrated the mediation proceedings is usually issued after any formal proceedings. That could, in practice, directly or indirectly influence the mind of the court and perhaps, subtly affect discretionary orders made by the court in the proceedings.Prevalence of mediation
How common is commercial mediation compared with litigation?
In Nigeria, commercial mediation is still a growing practice and not, at the moment, as common as litigation or arbitration. The majority of the mediation proceedings in Nigeria are court-ordered and not voluntarily initiated by the parties. Nonetheless, mediation has gained increased recognition in the commercial sphere and parties are increasingly making it a compulsory part of their dispute resolution clauses.
At the moment there is no available data on the proportion of mediation that is voluntary or court ordered, or both. We are aware, although there are no known official records in this regard, that thousands of court cases are filed in Nigeria every year across the various tiers of court. The same, however, cannot be said for mediation.
Is there a professional body for mediators, and is it necessary to be accredited to describe oneself as a ‘mediator’? What are the key requirements to gain accreditation? Is continuing professional development compulsory, and what requirements are laid down?
There are a number of professional bodies for mediators in Nigeria. These include the LCA and the Institute of Chartered Mediators. The LCA is an independent international centre for the resolution of disputes, particularly commercial disputes. Although it has its main focus on the resolution of disputes using arbitration, it also has a mediation centre for resolution of disputes through mediation.
Further, a number of mediation institutions, such as the LMDC, require that before a person (outside the panel of neutrals discussed at question 11) can be appointed as a mediator, such a person must have considerable relevant experience in their particular field of ADR practice and have been trained and duly certified by a reputable and recognised organisation such as the Negotiation and Conflict Management Group, Society of Professionals in Dispute Resolution, and the Centre for Effective Dispute Resolution.
Also, the various mediation institutions have different accreditation criteria. However, a common thread among all the criteria is that an intending mediator must, at the minimum, obtain a university degree and must be fluent in English. In addition, although not mandatory, practising mediators are expected to update their mediation skills by taking refresher courses both locally and internationally, and this will count for the purposes of continuing professional development.Liability
What immunities or potential liabilities does a mediator have? Is professional liability insurance available or required?
Under the rules of the various mediation institutions, the parties are usually required to undertake to indemnify the mediator in respect of any liability from any act or omission in connection with the mediation proceedings. Indemnity clauses are also usually contained in the mediation agreement between the parties and the mediator. Hence, professional liability insurance is rarely required in Nigeria.Mediation agreements
Is it required, or customary, for a written mediation agreement to be entered into by the parties and the mediator? What would be the main terms?
The mediator, the parties and their representatives in a dispute submitted before a mediation institution in Nigeria are usually required to execute written mediation agreements before the commencement of the mediation proceedings. At the LCA, for example, this is usually done at the pre-mediation session using a prescribed form.
The main terms of the mediation agreement would typically include:
- details of the parties and their representatives for the mediation proceedings;
- details of the dates, times and venue of the mediation proceedings;
- an undertaking by the mediator to conduct the mediation diligently in accordance with the rules of the institution or any rules chosen by the parties, which may have been approved by the management of the institution;
- confirmation from the mediator that there is no conflict of interest;
- an undertaking by the parties to indemnify the mediator of any liability that arises from or is connected to the mediation unless it is caused by his or her fraud or dishonesty;
- confidentiality requirements; and
- terms of payment of the costs of mediation.
How are mediators appointed?
Various Nigerian mediation institutions have guidelines that govern the appointment of their panel of neutrals - the list of individuals available to act as mediators over any disputes submitted to the institution. The panel of neutrals is expected to consist of people with sufficient experience in their field as well as training and certification in the art of mediation.
Mediators are usually appointed from the panel of neutrals for specific proceedings. They can be appointed by the parties, or alternatively by a person responsible for such appointment (in the LCA, the president and in the LMDC, the executive secretary).
Although parties typically choose individuals from the panel of neutrals provided by the mediation institution to which they have submitted their dispute, they need not do so. Where parties have agreed in their contract, or subsequently, to appoint a particular mediator or use another procedure for appointment, they may do so.Conflicts of interest
Must mediators disclose possible conflicts of interest? What would be considered a conflict of interest? What are the consequences of failure to disclose a conflict?
Most mediation agreements contain terms mandating the mediator to disclose any conflict of interest. Also, by the rules of various mediation institutions in Nigeria, the mediator must disclose any possible conflicts of interest. The scope of the disclosure will depend on the rules of the mediation institutions or the agreements of the parties. For instance, under the LCA Mediation Rules, a potential mediator is expected not to have ‘any past or present, direct or indirect relationship with any of the parties whether financial or professional or any other relationship or any circumstances which may prejudice [the] duty to assist parties to resolve the dispute in a fair, just, independent and impartial manner’. Under the LMDC Practice Directions, the prospective mediator must disclose any circumstance likely to create a presumption of bias or prevent a prompt meeting with the parties.Fees
Are mediators’ fees regulated, or are they negotiable? What is the usual range of fees?
Mediator’s fees are not typically regulated in Nigeria. Where parties voluntarily appoint mediators and conduct their mediation proceedings outside the ambit of the mediation institution, the mediators’ fees are negotiated between the parties and mediator at their discretion.
The fees payable to mediators would depend on several factors, including the complexity and technicality of the dispute, the time involved in settling the dispute as well as the number of mediators with the level of experience to handle the dispute in relation to that subject matter within the relevant jurisdiction. This can vary quite significantly and can range between US$200 and US$50,000 or more.
For institution-based mediation, the guidelines of such institutions usually give the institution the authority to determine the mediators’ fees and any registration or administration fees payable by the parties.
ProcedureCounsel and witnesses
Are the parties typically represented by lawyers in commercial mediation? Are fact- and expert witnesses commonly used?
Parties are typically represented or at least, supported by lawyers in commercial mediation. In mediation proceedings in Nigeria, particularly within the mediation institutions, lawyers are accepted and even expected to be a part, albeit less significantly, of the mediation proceedings. This is particularly so for referral cases in the LMDC where the parties would already have legal representatives in the litigious dispute. The only requirement to be observed with respect to representatives is that where any party does not intend to participate in the proceedings themselves, their representatives must provide a letter of authority or power of attorney to the institution, signed by the party permitting the representative to execute binding settlement agreements on their behalf. Party representatives, particularly legal representatives, are enjoined under Nigerian law to encourage ADR and amicable settlement (including mediation) among clients.
Independent experts and witnesses are also recognised and accepted in mediation proceedings when they are needed. It is important to note that the rules of confidentiality applicable to mediators and the parties to a dispute are also binding on any representatives, experts or witnesses in the proceedings.Procedural rules
Are there rules governing the mediation procedure? If not, what is the typical procedure before and during the hearing?
There are generally no rules governing the mediation procedure. However, most mediation proceedings in Nigeria involve the following procedures.Pre-mediation sessions
Prior to the start of the mediation sessions, the mediator usually engages in pre-mediation sessions with the parties and their representatives. These sessions are to enable the mediator to determine and understand the basic issues in the dispute. They also give the mediator an opportunity to determine the structure of the mediation process that would be most suitable for the parties. Additionally, at this meeting, the mediator, the parties and their representatives enter into a mediation agreement, which specifies the terms that will govern the mediation proceedings.The opening session
This is the first main joint session between the mediator and the parties to the dispute. At this stage, the mediator will explain the mediation process, his or her role as a mediator, etc. Resolution of relationships may also be attempted in this session before the proper mediation on the issues in dispute begins. The issues in dispute will also be identified and characterised and the parties’ priorities will be determined.Private caucusing
Private caucusing is a recognised step in mediation proceedings in Nigeria. It provides an opportunity for parties to provide important information that they ordinarily would not have provided to the mediator in the presence of the other parties. Private caucusing usually occurs after the first joint session at the opening phase. However, it can occur several times and at any time in the course of the proceedings.Joint sessions
At these sessions, the parties attempt to come to a resolution or settlement on the issues in dispute with the guidance and encouragement of the mediator.Closure
Where the parties reach a settlement on some or all of the issues in dispute, they will agree on terms and this will be incorporated in a settlement agreement or memorandum of understanding executed by the parties (or their authorised representatives).Tolling effect on limitation periods
Does commencement of mediation interrupt the limitation period for a court or arbitration claim?
Although mediation is greatly encouraged within the Nigerian legal landscape, it does not prevent or stop the period of limitation stipulated by statute from running. It is thus the practice that where one stands the risk of running out of time, the proper approach is to institute an action in court and apply for an adjournment to enable mediation take place, where the parties are in agreement.Enforceability of mediation clauses
Is a dispute resolution clause providing for mediation enforceable? What is the legal basis for enforceability?
A dispute resolution clause providing for mediation is enforceable under Nigerian law. This is based on the settled principle of Nigerian law that parties are bound by the terms of their contract and are not encouraged to act outside these terms.Confidentiality of proceedings
Are mediation proceedings strictly private and confidential?
Mediation proceedings are private and confidential. These conditions are provided for in the rules of the various mediation institutions and in the mediation agreement. There is a duty of confidentiality on the part of the mediator, the parties and all representatives, witnesses or other participants of the proceedings, and the confidentiality duty is permanent. The proceedings and any other documents or information used in or arising from them are confidential and without prejudice.
The above notwithstanding, there are some exceptions to the duty of confidentiality. Primarily, disclosures may be made with the consent of all the parties to the dispute. Documents provided for or arising from mediation may be disclosed if they would ordinarily have been available for discovery in arbitration or litigation proceedings. Information may also be disclosed to the extent that it is necessary to enforce any settlement agreement reached in court. Under the Citizens Mediation Centre Law, information from mediation proceedings at the Citizens Mediation Centre can also be disclosed where it is necessary to enable any person to perform its legal duties. Any criminal offences disclosed during the proceedings are also not subject to the confidentiality protection.Success rate
What is the likelihood of a commercial mediation being successful?
Although there is no empirical data on this point, it is generally acknowleged that some civil claims, particularly intellectual property claims or low-value claims, often end in settlement as a result of mediation in Nigeria.
Must a settlement agreement be in writing to be enforceable? Are there other formalities?
A settlement agreement need not be in writing to be binding or enforceable under Nigerian law. However, if the parties intend to enter same as a consent judgment, the agreement must be in writing and filed at the registry of the court. Moreover, it is advisable for the parties to put their agreement in writing to create tangible evidence of its existence.
Furthermore, settlement agreements made under the auspices of mediation institutions are generally required to be in writing and signed by the parties or their appointed representatives) and the mediator. The LMDC Practice Directions give detailed analysis of the process of preparing and enforcing the settlement agreement, which is as follows: the mediator is to put into writing the ‘terms of settlement’ the parties have agreed to; the parties then make comments or inputs to what has been written down by the mediator; and once they are satisfied, the parties can sign the settlement agreement. The settlement agreement would then be taken to the judge who referred the matter (in a referral case) or to an ADR judge for endorsement.Challenging settlements
In what circumstances can the mediation settlement agreement be challenged in court? Can the mediator be called to give evidence regarding the mediation or the alleged settlement?
It is rare for parties to challenge the mediation settlement agreement. This is particularly true of agreements made under the auspices of the LMDC or Citizens Mediation Centre, which upon endorsement by the ADR Judge, automatically attain the status of a court order or judgment that can only be challenged upon appeal or set aside on limited grounds such as fraud or lack of jurisdiction. This also applies to settlement agreements which have been made the consent judgment of the court.Enforceability of settlements
Are there rules regarding enforcement of mediation settlement agreements? And on what basis is the mediation settlement agreement enforceable?
There are no special rules regarding the enforcement of mediation settlement agreements. The practice is that parties file and adopt the mediation settlement agreements in court as their terms of settlement. The court will then enter the agreement as the judgment of the court (ie, a consent judgment).
Prior to the agreement being adopted by the court, the mediation settlement agreement will remain an agreement which is enforceable as it would be in cases of the non-fulfilment of any typical contractual agreement - by way of an action in court.
Additionally, under the LMDC Law and the Citizens Mediation Law, the mediation settlement agreement is enforceable as an order of the court once it is endorsed by a judge.
Stays in favour of mediationDuty to stay proceedings
Must courts stay their proceedings in favour of mediation?
Nigerian courts would usually stay their proceedings temporarily in favour of mediation or out-of-court settlement discussions if and when parties inform the court that they are engaged in same with the aim of settling the dispute amicably.
MiscellaneousOther distinctive features
Are there any distinctive features of commercial mediation in your jurisdiction not covered above?
Med-arb is one of the popular ADR mechanisms recognised in Nigeria. It allows the parties to first explore mediation, which is less expensive than arbitration and, in the event that the parties are unable to resolve the impasse by mediation, the dispute is then referred to arbitration. In the LMDC, for example, where mediation fails, the parties can typically move to arbitration within the LMDC if it is stipulated in their agreement or they desire to do so. Generally, mediators do not subsequently act as arbitrators or judges in the same matters, so a new person is appointed as arbitrator.
Update and trendsOpportunities and challenges
What are the key opportunities, challenges and developments which you anticipate relating to mediation in your jurisdiction?No updates at this time.