Dr Ewelina Stobiecka

radca prawny

I’ve been supporting entrepreneurs for almost twenty years in resolving commercial disputes in and out of court. I represent my clients as an attorney and negotiator and also act as a commercial mediator...
[Read more>>>]

Settle your dispute

Case study: from arbitration to mediation

Ewelina Stobiecka25 July 2020Comments (0)

From arbitration to mediationMEDIATION PARTIES:

– property development company
– architectural studio

VALUE OF THE SUBJECT MATTER OF THE DISPUTE

PLN 1,200,000

BRIEF DESCRIPTION OF THE CASE, INCLUDING THE WORKED OUT SETTLEMENT

The parties concluded a contract for the performance of fit-out and design works for a new shopping centre in one of Polish cities. The contract amounted to PLN 6,000,000 and concerned the entire shopping complex.

As a result of problems related to the macroeconomic situation, the developer had to discontinue the investment and break the contract with its contractor. On the part of the contractor, i.e. the architectural studio, certain costs have already been generated, related to the design work performed to date, valued at approximately PLN 1,200,000.

The design company demanded the return of the amount due for the performed works, while the development company justified its failure to complete the works and to discontinue the entire investment due to its poor financial situation. The parties reached an impasse.

The contract linking both parties provided for arbitration for the disputes that arose, which, as it turned out after preliminary calculations, would generate additional costs of conducting the dispute at the level of initial fees of approximately USD 60,000. The arbitration clause in the Agreement effectively blocked the Parties from pursuing the claim in court. Therefore, the Parties decided to engage in out-of-court talks, in a mediation formula.

As a result of the mediation, the Parties managed to reach a Settlement Agreement, in which both Parties agreed to pay a significant part of the remuneration for architectural works already performed, with a simultaneous reduction of certain additional costs and interest that were related to the claim. The payments were spread in instalments convenient to both Parties and so that the developer, who was currently in a poor financial position, could meet its obligations.

Due to the desire to approve the Settlement before the Court, the Parties applied to the Court for approval of the Settlement and at the court date set within a few days, the Parties officially approved the Settlement reached before the Mediator.

This case is also an example of how mediation has successfully reduced the costs of proceedings from approximately USD 60,000 for an entry in arbitration to several thousand PLN in total costs of the entire (private) mediation process.

If you want us to help you solve a dispute in business, please contact us under:

tel.: +48 669 73 79 79e-mail: e.stobiecka@taylorwessing.com

{ 0 comments… add one now }

Leave a Comment

I consent to the processing of my personal data by Taylor Wessing for the purpose of answering my question in accordance with the data protection principles set out in the Privacy Policy.

The administrator of personal data is Taylor Wessing with its registered office at 1 Mokotowska Street in Warsaw.

Contact with the Administrator is possible at warsaw@taylorwessing.com.

Other information concerning the protection of your personal data, including in particular the right to access, update, limit the processing, transfer and object to further processing of data, can be found in this Privacy Policy. In disputable matters, you have the right to lodge a complaint with the President of the Office for Personal Data Protection.

Previous post:

Next post: