by Karan Kalsi
While small relative to international standards, New Zealand’s mediation industry has long punched above its weight. This article briefly covers two contemporary trends in the industry. The first is the increased mandating of alternative dispute resolution in industry-specific statute law. The second is the push for “true” cross-cultural competency in both a bicultural and increasingly multicultural context.
Brief Context: New Zealand as the “Odd Duckling”
Unlike Australia, the United Kingdom or the United States, New Zealand does not mandate mediation for private commercial disputes within the traditional court system (Morris, 2020). While there does appear to have been some growth in commercial mediation in New Zealand, most of this is confined to commercial contracts incorporating dispute resolution clauses that require the parties to attempt mediation before proceeding to either arbitration or litigation. The most common New Zealand state-run mandated mediation systems are within the family (e.g. child custody) and employment courts.
Consequently, multiple industry surveys demonstrate that the most common sources of mediation referrals for Kiwi mediators are their peers within the legal industry instead of the court system (Morris, 2020). Nina Khouri notes that this differing approach reflects the New Zealand court’s stronger preference for “voluntariness” and aversion to forcing parties to settle proceedings out of court through mandatory mediation.
Trend One: The Rise of Mandated Alternative Dispute Resolution in Industry-Specific Statute
Recent legislative developments have indicated that New Zealand is now following a “third path” away from both its existing approach and that of mandated mediation in the traditional court system. This third path involves Parliament mandating alternative dispute resolution in statute regulating specific sectors where it views the current absence of alternative dispute resolution mechanism is inefficient.
The most prominent example of this shift is the Farm Debt Mediation Act (‘the Act’) which came into force in July 2020. Under the Act, creditors must first offer farmers a mediation before taking any enforcement action about farm debt they have a security interest in. Equally, farmers can also call for a statutory mediation with their creditor, who can only decline on the limited grounds in the Act. Creditors can only ask farmers to contribute up to $2,000 towards the mediation cost and must meet the outstanding amount themselves (Green, 2019).
New Zealand commercial mediator Mark Kelly notes what distinguishes mediation under the Act is that “typically, there is no real substantive dispute. The farmers owe the money, and the lenders have the right to enforce” (2020). Instead, the emphasis is placed on the practical workability of solutions—such as over the timing, control, and monitoring—to settle the debt.
The Act’s scope cannot be understated. It applies to any form of secured lending in the agricultural sector. Recent estimates show that Kiwi farmers hold up to $63 billion in debt – an increase of over 270% in two decades (Walls, 2019). Since the Act came into force, Mark Kelly has “had the privilege of mediating c.$250M worth of farm debt to settlements” (2020).
The Farm Debt Mediation Act is not alone in the industry-specific opportunities it provides to New Zealand mediators. Recent amendments to the Trusts Act in 2019 include an express provision providing alternative dispute resolution for internal (trustee v beneficiary) and external trust disputes (trustee v third party). Before this, the New Zealand Courts generally held that trust disputes were out of the purview of alternative dispute resolution methods due to the uncertain and discretionary nature of many trust beneficiaries (Walls, 2021). In addition, the Government is seeking advice on incorporating alternative dispute resolution processes in the upcoming Resource Management Act reforms. These reforms will determine New Zealand’s urban planning and environmental consent procedures.
The increased preference of the New Zealand Government to mandate mediation in industry-specific statutory reforms provides both an immense opportunity to grow the domestic commercial mediation market, and for other jurisdictions to learn how to integrate the use of mediation in high-need sectors.
Trend Two: Moving Beyond ‘Tokenism’ – A Push Towards Equipping Mediators With ‘True’ Cross-Cultural Competency
The 1840 Te Tiriti o Waitangi (Treaty of Waitangi) between the British Crown and Māori has long distinguished New Zealand from other European settler states. Te Tiriti obligations have filtered into the mediation context, with dispute regulatory regimes increasingly including references to “culture” and “tikanga” (Māori customs and values). For example, recent amendments to the Te Ture Whenua Māori Act require introducing a new mediation model designed in accordance with Tikanga that will “play a pivotal role in the statutory regime” (Morris, 2017). The Act generally regulates the jurisdiction of the Māori land court and rules dealing with Māori freehold land.
In addition, cultural competence is one of the standards that would-be mediators are judged against through the FDR training provided by the Arbitrators’ and Mediators’ Institute of New Zealand (AMINZ) and the New Zealand Law Society (NZLS). This requires them to “take account of the parties’ diversity when choosing an appropriate mediation”, create a “culturally safe and inclusive environment”, and include “relevant whānau members in decision making” (Morris; 2017). However, Morris does note that these terms are often vaguely defined and risk encouraging a “tick box” exercise where Tikanga customs are only tokenistically mentioned but then forgotten in the rest of the mediation process.
These concerns have underscored the importance of Māori-led accreditation processes that move beyond the confines of the traditional facilitative model to mediation dominant in New Zealand. For example, whilst the facilitative approach would place the mediator at the centre of the introductory process, Tikanga would require the parties themselves to engage in whaikōrero (formal speeches) and karakia (ritual chants) that address matters of tapu (sacredness) (Morris, 2017). Equally, traditional mediation norms such as confidentiality are less rigid in a Tikanga context where Māori clients may wish to waive confidentiality in mediations concerning land disputes, which can affect a wider group of thousands of iwi with a genealogical connection to the land (Morris, 2017).
Consequently, initiatives such as the Tūhono accreditation have been developed to address this need. The accreditation process is Māori-led and run by the Tūhono Dispute Resolution Collective. It seeks to ensure mediators can demonstrate the competencies of a “Tikanga-based model of mediation inspired by traditional Māori narratives and dispute resolution methodologies”. Participation in the programme is only open to accredited mediators with the New Zealand Resolution Institute.
The recent introduction of the International Student Contract Dispute Resolution Scheme (‘the Scheme’) also raises an opportunity to develop additional cross-cultural competency amongst mediators. Historically, New Zealand has adopted a bicultural view that recognised the dominance of Māori and European cultural systems. However, recent immigration trends have pointed to an increasingly multicultural New Zealand, with over 15.1% of the population identifying as Asian and 8.1% from the Pacific. This is also reflected in most mediations under the scheme occurring with international students from China and India that have unique cultural needs which do not fall under the bicultural paradigm.
Recent trends have demonstrated the increased impetus for New Zealand mediators to change the existing mediation paradigm to incorporate Tikanga and non-European cultural practices. Qualifications such as the Tūhono accreditation will become more common as the mediation community recognises the need for Māori-led programmes to assess bicultural competency effectively. Furthermore, the rise of Asian and Pacific immigration will require Kiwi mediators to think beyond the bicultural paradigm in an increasingly multicultural client base.
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References:
Morris, Grant Hamilton and Alexander, Katie, Inclusiveness or Tokenism? Culture and Mediation in New Zealand’s Dispute Resolution Statutory Regimes (August 1, 2017). 28 ADRJ 170, Available at SSRN: https://ssrn.com/abstract=3258090.
Morris, Grant Hamilton. The Final Piece of the Jigsaw: A Longitudinal Study of New Zealand’s Commercial Mediation Market 2020 New Zealand Business Law Quarterly 26(1): 41-58.
N Khouri “Mediation” [2021] NZ L Rev 169.
https://www.nzdrc.co.nz/alternative-dispute-resolution-under-the-trusts-act-2019-missing-in-action/
https://legislation.govt.nz/regulation/public/2016/0042/latest/DLM6748715.html
https://www.lawsociety.org.nz/news/lawtalk/lawtalk-issue-935/the-new-trusts-act-2019/