Yes. A commercial dispute can be settled after court proceedings have started in Ireland. Issuing proceedings does not prevent the parties from negotiating, making settlement offers or using mediation to resolve the dispute.
Section 6(3) of the Mediation Act 2017 expressly provides that issuing proceedings does not prevent mediation at any time before the dispute is resolved. Businesses can therefore continue to explore settlement while a commercial litigation case progresses.
However, successful settlement involves more than agreeing a figure. Legal costs, confidentiality, payment arrangements, enforcement and the formal disposal of the proceedings all need attention.
For businesses involved in commercial litigation in Ireland, settlement should be considered throughout the case as the evidence, risks and commercial priorities develop.
There is no single settlement window that closes when proceedings are issued. The parties can explore agreement at different stages, including shortly after proceedings begin, following the exchange of pleadings, during discovery, before trial or while a hearing is underway.
The most useful time to negotiate depends on what the parties know and what further litigation will cost.
Early negotiations may avoid substantial expenditure on discovery, expert reports and trial preparation.
However, a business should understand the claim, any counterclaim and the supporting documents before accepting a compromise. An early offer needs to be assessed against both the legal position and the practical likelihood of recovering payment.
The exchange of pleadings can reveal which allegations are disputed and where the parties’ positions differ.
This may create an opportunity to narrow the dispute, identify the documents needed for meaningful negotiations or propose mediation.
Discovery can change how a business assesses its case. Documents may strengthen a claim, expose weaknesses or clarify the scale of the alleged loss.
A sensible settlement strategy should be reviewed when significant evidence emerges, rather than remaining fixed to the position taken at the outset.
Settlement remains possible as trial approaches and during the hearing. Nevertheless, late settlement may come after substantial costs have already been incurred.
A settlement reached at that stage should address those costs expressly, alongside the substantive dispute.
These are practical opportunities to reassess the case, rather than mandatory stages at which negotiations must take place.
Yes. Commercial mediation can take place while court proceedings are ongoing.
A mediator helps the parties explore an agreed resolution. The mediator does not decide the dispute or impose a settlement, and participation remains voluntary.
Under section 16 of the Mediation Act 2017, the court may invite the parties to consider mediation, either on a party’s application or on its own initiative. If the parties decide to mediate following that invitation, the court may adjourn the proceedings, extend procedural deadlines or give other directions to facilitate the process.
Mediation can be particularly useful where the parties want to explore solutions such as staged payments, revised contractual arrangements, an orderly business separation or terms that preserve a trading relationship.
For a comparison of the available processes, read our guide to mediation, arbitration and litigation in commercial disputes.
Opening settlement discussions does not, by itself, stop the court timetable.
A business should continue to meet applicable deadlines unless an effective extension, adjournment or other procedural arrangement has been put in place.
The rules provide mechanisms to accommodate mediation. In the Superior Courts, Order 56A, rule 9 addresses the calculation of procedural time during an adjournment to facilitate mediation, unless the court orders otherwise. The solicitor managing the case should confirm precisely which deadlines are affected.
The Commercial Court also has specific case-management powers. Order 63A allows an initial adjournment of up to 28 days to consider referring proceedings or an issue to mediation, conciliation or arbitration. Where the parties decide to proceed with that process, the court may extend compliance deadlines. This is not a general 28-day limit on settlement negotiations or mediation.
The without-prejudice rule generally protects communications made in a genuine attempt to settle a dispute from being used as evidence against the party making them on the underlying issues.
This allows parties to discuss compromise without treating every concession as an admission of liability.
However, the words “without prejudice” are not a guarantee that every communication is protected. The purpose, substance and context of the communication matter, and the protection has recognised exceptions.
Settlement correspondence should therefore be carefully drafted. A without-prejudice heading does not provide permission to make improper threats.
Yes. Settlement offers can influence the court’s decision on legal costs.
A genuine settlement offer made “without prejudice save as to costs” is generally protected from use on the underlying merits of the dispute, while remaining available for consideration when the court determines costs.
Order 99, rule 3(2), of the Rules of the Superior Courts expressly recognises written offers made on this basis for the purposes of section 169(1)(f) of the Legal Services Regulation Act 2015. That section identifies whether an offer was made, and its date, terms and circumstances, among the matters relevant to the court’s costs decision.
However, making an offer does not automatically guarantee a favourable costs order. Its significance depends on the terms of the offer, the outcome of the proceedings and the circumstances of the case.
Your solicitor should consider the appropriate form of offer, whether it includes interest and legal costs, the time allowed for acceptance and whether a formal payment into court or another applicable procedure is appropriate.
Mediation is voluntary, but an unreasonable refusal can have consequences.
Under section 21 of the Mediation Act 2017, when awarding costs in proceedings covered by section 16, the court may consider an unreasonable refusal or failure to consider mediation or attend it following a court invitation.
The High Court’s mediation practice direction, effective from 3 June 2026, confirms that unreasonable failure to engage when invited may have adverse costs consequences, even for a party that is wholly successful in the proceedings.
This does not mean that every refusal is unreasonable or that a business must accept the terms proposed at mediation. An invitation should be assessed carefully, and any reasons for declining should be considered with legal advisers.
Without-prejudice protection, mediation confidentiality and contractual confidentiality serve different purposes.
Section 10 of the Mediation Act 2017 protects mediation communications, records and notes, subject to statutory exceptions. Disclosure may be permitted, for example, where necessary to implement or enforce a mediation settlement or where required by law.
Existing evidence does not become privileged or cease to be discoverable simply because it is used in mediation.
If confidentiality of the final settlement is important, the agreement should address it expressly, including permitted disclosures to advisers, insurers and others who legitimately need the information.
Businesses should also consider what must be disclosed to the court when concluding the proceedings. A confidentiality clause should not be treated as a guarantee that every aspect of the dispute or settlement will remain private.
The parties should clearly record the agreed terms and when they become legally binding.
Section 11 of the Mediation Act 2017 provides that a mediation settlement has effect as a contract, except where it expressly states that it has no legal force until incorporated into a formal agreement or contract signed by the parties.
The Act also provides for court enforcement, subject to statutory safeguards and grounds for refusing enforcement.
A commercial settlement agreement should address:
The authority of those agreeing terms on behalf of a company, insurer or other party should also be confirmed.
A consent order is an order made by the court on terms agreed by the parties.
Depending on the settlement, the parties may seek an agreed order dealing with payment, costs or the disposal of the proceedings. Order 56A expressly permits the court to make an agreed order following mediation, including an order finally disposing of the proceedings, where all parties, including any third parties, agree.
A settlement agreement and a consent order are not interchangeable. The appropriate structure depends on the obligations agreed and how they may need to be enforced.
If a party defaults, the available response depends on the agreement and any court order. It should not be assumed that the original proceedings automatically restart or that every breach can be enforced through the same procedure.
A business should compare the proposed settlement with the realistic alternatives.
That assessment should include the strength of the evidence, the value of any counterclaim, future legal expenditure, management time, business disruption and the other party’s ability to pay.
It should also consider whether urgent protection is needed while discussions continue, whether non-financial terms would help and whether the settlement can be implemented without creating another dispute.
For example, a supplier pursuing unpaid invoices may value prompt payment and workable future trading terms. A shareholder dispute may require an agreed exit, valuation process and release of guarantees. The settlement strategy should reflect those different objectives.
Earlier legal expenditure is relevant, but the decision to continue should also assess the additional cost and risk of the next stage.
For further context, see how long commercial litigation takes in Ireland.
Starting proceedings does not remove the opportunity to negotiate. The objective is to secure terms that address the dispute, protect the business and can be enforced if necessary.
Sherwin O’Riordan advises businesses on commercial litigation, mediation and negotiated dispute resolution. We can help assess settlement proposals, consider costs exposure and document an agreed resolution.
Call 01 663 2000 or email info@sor.ie to discuss your commercial dispute.
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