THE  parties to the dispute between GM Holden and its dealers over compensation for the premature curtailment of retailers sales and service agreements, have agreed to appoint a former Federal Court judge, Peter Jacobson QC, a legal specialist in business law, to mediate in the matter.

His appointment follows massive political, legal and media pressure on GM Holden and a threat from the Australian Competition and Consumer Commission (ACCC) to take the car maker to court, which forced GM to back down from its end-of-month deadline (May 31) and come before a mediator to settle the dispute with dealers.

GM had told dealers that if they did not accept the terms of its compensation offer to dealers by the end of May, then the offer would be withdrawn.

But the ACCC intervened.

The regulator announced last week that Holden has now committed to negotiate with its dealers in good faith about compensation for Holden’s withdrawal from the Australian market, as required under the Franchising Code of Conduct and Australian Consumer Law.

However GM Holden has warned that “good faith participation in dispute resolution does not oblige a participant to accept, make, change or increase any offer of compensation.”

In effect, mediation is not binding on either party and the matter could still wind up in court.  But at this stage it is the role of Mr Jacobson to attempt to get both sides talking through their claims and resolve differences.

One potential role for the mediator as an experienced judge is to point out to both parties how a judge at trial might view the positions of each party and what rulings a court might make in a trial judgement.  This gives the parties a view of what the outcome might be should the matter go to trial and give one or both parties a cause to pause before pulling the litigation trigger.

Mr Jacobson QC was a judge of the Federal Court of Australia June 2002 until January 2015.

He was admitted to the bar in 1979 and specialised in trade practices, commercial law and equity. He obtained his law degree with honours at the University of Sydney and went on to get his Master of Laws from the University of Pennsylvania.  He then became a member of the faculty of law at McGill University in Montreal.

Earlier this week GM Holden announced that the dispute resolution process would take place in the week of June 8 via online video links.

The company said in a statement that: “Holden’s compensation offer remains open for dealers to take through the process and right up to the acceptance date of 30 June 2020, as has already occurred.

“GM Holden has undertaken not to decrease its offer to dealers and the company notes that good faith participation in dispute resolution does not oblige a participant to accept, make, change or increase any offer of compensation.

“GM Holden firmly believes it has operated in good faith and flatly rejects any claims to the contrary. Our compensation offer is fair and reasonable, and the company continues to seek an outcome that supports the transition for dealers and ongoing support for existing customers.

“As the company has stated previously, GM Holden wants an ongoing relationship with dealers and it does wish to provide them with the opportunity, as part of a compensation package, to enter into an ongoing long-term service and parts supply agreement.”

By John Mellor