Litigation comes with its share of risks and uncertainties, which can cause clients to question the amount of time it will take for their issues to be resolved as well as the associated cost. The COVID 19 has forced many organisations and institutions to rapidly change over night – including courts who are now tackling considerable delays in court proceedings. According to government statistics from December 2022, the average time fast/multi track trials from issue to trial had increased from 59.4 weeks before coronavirus struck, up to 75.9 weeks in December 2022, that is nearly 30% increase. The picture shows similar increase in the small claims court.
Litigation is a major distraction for both business owners and individuals, it distracts them from focussing on their business, work or just getting on with life. The impact of that delay cannot be underestimated.
Litigation can be costly and once litigation is commenced, the costs can spiral out of control. This is demonstrated by an infamous case involving neighbours in a dispute over a drain repair of £4227.00, the parties combined legal costs were in excess of £300,000. This case made it into the papers, with justifiable comments as “money down the drain”. This raises an important question: is there another way? I would suggest the answer is that mediation is a viable avenue for resolution.
Although Alternate Dispute Resolution (ADR) via mediation has been around for many years, some people still prefer the traditional courtroom approach to settle disagreements. For those individuals who are unaware of what mediation is and how it works: It’s an effective method combining communication with negotiation in order to find acceptable solutions without going through costly court proceedings.
The courts are obliged by the civil procedure rules to encourage “the parties to use an alternative dispute resolution procedure if the court considers it appropriate and facilitating the use of such procedure”[1] As long ago as 2003 Judges were flagging up the court’s approach to alternative dispute resolution, “the fact that a party believes that he has a watertight case again is no justification for refusing to mediate.” [2] Whether you win or lose your case in the court arena, the failure to use mediation or other forms of ADR puts you at a potential risk of either not getting a cost or partial cost order in your favour or worse still, being awarded costs against you on an indemnity basis.
Legal proceedings are a minefield of potential risks, some foreseeable and others impossible to anticipate. The newsworthy case between two footballer’s wives serves as an example, illustrating the dangers if evidence falls short. Ms Vardy, who was on the losing side, must now pay not only her own legal fees but a staggering 90% of those incurred by Ms Rooney, this is estimated to be £1.5 million!
Given all the risks of the court route, what is holding you back from attending mediation?
My experience, both as a professional mediator and as a barrister, is that fear is what holds people back from considering mediation.
– Anxiety of the unknown process,
– fear of being pressurized to settle, forced to retreat or a being seen as being weak and
– fear that mediation will be a waste of money.
Fear of the Unknown
Many of us have at least some understanding of the court experience, thanks to its frequent representation in media. But fewer are familiar with mediation – a process that puts you and your needs first as it allows for more control during decision making than traditional trials do. Your mediator will guide you through this alternate path should you choose it, support from a solicitor is always welcomed if desired or another representative. (Maybe a direct access barrister?)
All mediation is negotiation facilitated by a neutral third person, the mediator, who assists you in coming to a commercially viable solution. Colman J encapsulated mediation succinctly “as a tool for dispute resolution it is not designed to achieve solutions which reflect the precise legal rights and obligations of the parties, but rather solutions which are mutually commercially acceptable at the time of the mediation.” [Cable and Wireless PLC v IBM United Kingdom Ltd 2003 EWHC 316] Within mediation, the mutually commercially acceptable solutions may be solutions that are not open to a court to order.
Pressurized into an agreement.
This is a common fear that is not confined to individual or small firms. British Aerospace [BAE] a large commercial company, stated the reason as to why they did not want to mediate was “BAE thought that the mediation had been suggested on the basis that it would put BAE under some pressure to make a settlement payment with respect to a claim which BAE considered had no real prospect of success..”.[3]
Whilst BAE were not penalised with costs, the Judge was clear that mediation was still possible as not every mediation ends in a payment to the claimant, that even BAE’s entrenched position [my words] ignored “the ability of the mediator to find middle ground by analysing with each party its expressed position and making it reflect on that and the other parties’ position. It allows the mediator to bring the necessary skills of evaluation and facilitation to find solutions which have not been considered. These may include such things as bringing other commercial arrangements or disputes into the discussion or, in this case, resolving the consequences of termination or finding future opportunities…” [4]
Clients often forget that there are pressures in court proceedings to come to an agreement. The strongest being that if you do not come to an agreement, the Judge can impose an order upon you which for you maybe the worst case scenario.
A high number of cases settle at the court door; this probably reflects the pressure of court proceedings. In Garritt Critchehley v Andrew Ronan and Solar Power PV Ltd [5] after a 4 day trial but before judgement the parties settled the £210,000 claim for £10,000. Settlements are not uncommon just before judgement, but did the parties feel under pressure to settle due to the costs in this case? The costs were £96,000 and that was in 2014!
Mediation is a waste of money
When weighing up the pros and cons of mediation, it is important to consider all potential risks. Ultimately, only you can decide if using mediation will be beneficial. It’s possible that even though the end result may not always meet a traditional definition of success, one could still benefit from having their dispute resolved in a timely manner with minimal energy expenditure – potentially saving significant amounts of money compared to court proceedings.
When considering the suitability of mediation, it is important to evaluate all potential risks and identify which goals are most essential to you. While not every situation may be well-suited to mediation, successful outcomes can present themselves in different forms. This could include quick resolution times or solutions tailored specifically to one’s individual preferences, solutions that you had not thought of, solutions that work around your schedules and all at a fraction of the cost associated with lengthy court proceedings. Ultimately, reaching an agreement quickly and successfully leads to peace of mind knowing a resolution has been reached so both parties can move forward.
One common reaction to mediation is that it will not work as, one or both parties believe they have a solid winning argument, the parties involved are too entrenched in their positions. Helpful guidance is given in Halsey v Milton Keynes General NHS Trust [6]and PGF II SA v OMFC Company 1Ltd as to when it may be reasonable not to mediate, otherwise the onus is to attempt ADR.
Drawing together the elements raised in this article, the court system is reaching a tipping point; with cases backlogged, delays mounting, the lack of control over costs and the inevitable stress of court proceedings. Is it about time you considered mediation as a way forward?
For further information about mediation please contact either myself or my clerks at clerks@becket-chambers.co.uk
[1]. [CPR 1.4.(e)]
[2]. Hurst v Leeming 2003 1 Lloyds Rpt 379 Lightman J
[5]. 2014 EWHC 3148
[6]. 2004 EWCA civ 576 , 2013 EWCA civ 1288
