Disputes between companies: participatory procedure and collaborative law

Verified 04 December 2024 - Directorate for Legal and Administrative Information (Prime Minister)

Alternative dispute resolution (ADR.) allows companies to settle disputes out of court. The most common are mediation, the reconciliation or else arbitration. Participatory procedure and collaborative law are friendly methods of dispute resolution conducted with the assistance of lawyers.

Participatory procedure

The participatory procedure is a negotiation by specialized lawyers.

The parties shall draw up a contract (or participatory procedure agreement) by which they undertake to seek together an amicable resolution of their dispute or the preparation of their dispute.

The commitment to negotiate good faith is a central element of the participatory procedure.

The participatory procedure may take place:

  • either outside a judicial proceeding : we are talking about conventional procedure. In this case, it is not possible to refer the matter to the court for a ruling.
  • either in judicial proceedings : we are talking aboutparticipatory pre-trial procedure. The parties and their lawyers agree to put their dispute in a state to be tried. They define a working methodology and a meeting schedule. They shall also jointly select the experts they wish to use. This allows the judge, at the end of the proceedings, to make a decision on the merits.

Please note

Where an agreement on participatory procedures is concluded, the matter may not be referred to the court for a decision.

The Participatory Procedure Agreement must be drawn up by written.

It is concluded for a fixed term, which helps to anticipate when the dispute may end.

The Convention shall comprise must include the elements following:

  • Identification of the parties and their lawyer (names, forenames, address)
  • Term (or duration of the contract)
  • Subject matter of the dispute
  • Documents and information necessary for the resolution of the dispute or for the preparation of the dispute and the arrangements for their exchange. Upon signature of the agreement, the parties shall select the documents to be communicated to the other party.
  • Documents signed by lawyers if necessary (e.g. hearing of the parties)

The parties may provide in the agreement for an obligation of confidentiality.

The assistance of lawyers is obligatory in the participatory procedure.

It is also exclusive: it is a "monopoly" recognized by lawyers.

Lawyers are not required to undergo specific training to assist parties in the participatory process (unlike the collaborative process).

Outcomes depend on the type of participatory procedure initiated:

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Conventional participatory procedure

  • In case of agreement : the parties shall conclude an agreement bringing the dispute to an end in its entirety. The parties may apply to the court forapproval agreement to give it the force of a court decision. This approval is done by a request filed with the court.
  • If the participatory procedure fails : the parties did not reach an agreement before the end of the participatory procedure agreement. Then they can go to court. In this case, they are not obliged to go through a conciliation or prior mediation procedure.

FYI  

The parties, assisted by their lawyers, may terminate the agreement before the end of the term.

Participatory pre-trial procedure

  • In case total agreement on the substance of the dispute: the party or parties shall seek the approval of the parties.
  • When the state of the case is such that it can be tried but the agreement on the substance is partial : a lawyer’s bill shall formalize the points agreed between the parties and the points still in dispute. The parties may ask the court to rule on the residual dispute. They may at the same time request the approval of the points on which agreement is reached.
  • When the state of the case is such that it can be tried but the entire dispute persists on the substance: a lawyer’s bill formalizes the points agreed between the parties and the points still in dispute. The parties may ask the court to rule on the dispute.
  • When the negotiation failed and did not allow the case to proceed to trial: the case is before the court for trial

Collaborative Law

The collaborative law process is an amicable dispute resolution (ADR.) process. The parties and their counsel shall sign a contract under which they undertake to settle a dispute by negotiation.

The parties undertake not to refer the matter to the judge for the duration of the process.

So the collaborative law process comes in before any referral to a judge.

FYI  

The cost of the collaborative process varies with lawyers' fees. Allocation may be agreed.

By signing the contract to participate in the collaborative process, the parties undertake to respect the principles following:

  • Not to go to court during the collaborative process
  • Working as a team. The team is made up of the parties, their lawyers and possibly third parties, knowing if their enlightenment proves necessary.
  • Respect the fairness and transparency. The parties undertake to share all the elements necessary to reach an agreement acceptable to everyone.
  • Respect a enhanced confidentiality. It concerns all exchanges of documents or information during the process.
  • Withdrawal of the two lawyers in case of failure. Lawyers cannot continue their intervention if the case is brought before the courts; they must withdraw.

The collaborative process takes place in several stages steps defined in the contract.

The negotiation consists of meetings between the parties and their lawyers. These meetings follow a very specific agenda. Lawyers help the parties listen and talk to each other to reach a mutually acceptable settlement.

This is a real teamwork with the aim of exchanging with confidence without the threat of legal action.

Negotiation generally follows next steps :

  • State of play/narrative: each side expresses its feelings about the situation
  • Determination of objective interests and information: search for needs, concerns, values of each party.
  • Collection of all objective elements: all information is shared. The lawyers analyze them and indicate all the legal and financial implications of the situation.
  • Assumptions or options that could answer the questions posed by the situation: this step allows to open the field of all possibilities to reach an agreement.
  • Settlement offers by each of the parties meeting the interests of both parties

FYI  

Sometimes, a knowing third party (for example: a mediator, notary, accountant or psychologist). He must then sign a agreeable the contract which specifies the principles which it undertakes to observe.

Only lawyers with training follow-up specific in collaborative law may intervene. This training allows them to master the negotiation process and different tools (reasoned negotiation, active listening, reformulation). There is a list of lawyers practicing collaborative law:

Find a lawyer who specializes in collaborative law

In case of agreement, lawyers shall draw up a memorandum of understanding to seal the deal. The Parties may submit the Agreement to type-approval of the judge. The approval decision gives the agreement the force of a court decision.

In case of failureeither party may bring the matter before the judge. Each lawyer must then withdraw and can no longer represent or assist his client.

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