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OFMA Mediation

OFMA mediation can be initiated at any time for disputes covered by the Franchising Code of Conduct.

Mediation is a business meeting where a neutral person (the mediator) assists the parties to resolve their dispute through discussion and understanding. The mediator helps the parties to break down the issues, focus on what each side needs to reach an agreement and consider their alternatives so that they arrive at a solution that is workable and lasting. It is the parties who decide the outcome of the mediation. The mediator does not give legal advice nor make a determination.

Every year around 120 OFMA mediations take place, of which on average about 75% result in settlement.

Steps:

  1. Complainant sends dispute notice to the other party explaining:
    1. the nature of the dispute; and
    2. what outcome the complainant wants; and
    3. what action the complainant thinks will settle the dispute.
    You may wish to use our Notice of Dispute template.
  2. If the dispute is still unresolved after 3 weeks, either party may apply to OFMA for the appointment of a mediator;
  3. OFMA writes to both parties to confirm the mediator appointment;
  4. The mediator contacts both parties to:
    • arrange a time and place for mediation;
    • confirm who will attend the mediation;
    • arrange for an exchange of documents, as appropriate;
    • arrange for an estimate of fees to be paid prior to mediation;
    • arrange for the mediator appointment agreement to be signed prior to mediation;
    • assist the parties with questions they may have around the mediation process.
  5. At mediation, the parties will have the chance to explain the problem as they see it and then consider ways to resolve the issues. If agreement is reached, it will usually be put down in writing and constitute a binding agreement.
  6. After mediation, the parties are invited to provide OFMA with confidential feedback on the service provided by OFMA staff and the appointed mediator.

Cost:

Mediation is a very inexpensive process when compared with litigation. On average, mediation costs each party approximately $1,200. The standard mediator rate is $275 per hour (including GST), which is shared equally between the parties. The actual cost depends on the actual time spent by the mediator. Some disputes may be eligible for reduced mediation fees depending on various factors including the monetary value in dispute and the nature of the issues.

Location:

Mediation is usually held wherever the parties agree. In situations where parties are located in different states, our Office usually appoints in a neutral location. However, OFMA staff are also willing to assist in faciliating a discussion between the parties to see whether one party is willing to travel to the other, with the non-travelling party contributing to half a return economy airfare of the travelling party. If neither party is willing to travel to the other, OFMA will appoint a mediator in a neutral place and both parties would be expected to bear their own travel costs to attend.

Who Should Attend:

Parties must be represented at the mediation by a person who has the authority to enter an agreement to settle the dispute on behalf of the party. Legal or other advisers may attend if both parties agree.

Legal Issues :

The Code requires parties to attend the mediation, be represented by someone with authority to settle the matter and to participate in mediation in good faith. Failure to do so can attract a penalty of 300 units ($54,000.00 as of October 2015).