Why mediation can be a less stressful, quicker and more cost effective way to settle a dispute

Fri 27th Oct 2017

While many people may want their ‘day in court’, the alternatives can be considerably less stressful, quicker and far more cost effective. A new consultation is now underway to make alternative dispute resolution compulsory in civil cases. Darren Higginson, Associate in Coodes Solicitors’ Personal Disputes Team explains why alternative dispute resolution, particularly mediation, can be a better option.

I have heard of Alternative Dispute Resolution, and something called ‘mediation’, but what is it?

These days the Court will, quite simply, no longer tolerate the “do as I say in seven days, or I’ll see you in Court” approach. Increasingly, the Court expects the parties to a dispute to try to address and resolve their differences outside of the formal Court process. This is known as ‘Alternative Dispute Resolution’ or ‘ADR’.

ADR exists in various forms, all of which are designed to settle the dispute without the involvement, or some would say, intervention of the Court.

Mediation has emerged as the primary form of ADR if the parties have been unable to settle directly between themselves. Mediation is a flexible, voluntary and confidential process in which the parties jointly instruct a neutral and professionally trained mediator.

At the mediation, the mediator aims to identify the issues; discuss in private with each party their (and their opponent’s) strengths, weaknesses and objectives; explore settlement possibilities; and ultimately try to broker a deal.

Unlike the Court, the mediator’s role is not to impose a decision as to who is right and who is wrong. With the mediator’s guidance, the parties retain control of their dispute and decide whether to settle and, if so, on what terms. Both parties need to commit to the process and be prepared to compromise their positions with a view to arriving at an agreed solution.

Is mediation any good for settling disputes?

Experience has shown that mediation can be extremely effective. Published statistics show that in 2016, 67% of cases settled on the day of the mediation with a further 19% settling shortly thereafter. Some mediators suggest even higher success rates.

The potential advantages are:

  • Having a mediator who is experienced in the subject matter of the dispute.
  • What is said at a mediation is usually ‘without prejudice’ and confidential. If an agreement is not reached, what is said cannot be used in subsequent Court action by the other party. Confidentiality avoids sensitive issues being made public in Court.
  • A mediator is less restricted than the Court. It can be possible to negotiate and agree on issues that fall outside of the Court’s jurisdiction.
  • A mediator can very often provide the parties with a way out without ‘losing face’ if they have previously reached an impasse.
  • It is potentially quicker and cheaper than relying on the Court process.

Are there any downsides to mediation?

Inevitably, yes there are some potential downsides, such as:

  • If unsuccessful, mediation can add to costs and delay the dispute being resolved.
  • A party may be reluctant to reveal its hand or compromise its case if it believes success in Court is guaranteed.
  • A clear ‘win’ is not usually the outcome of mediation. Unfortunately some clients still look at disputes as a matter of principle rather than through commercial eyes. They are often in for a disappointment when they realise that they will have to negotiate.
  • Some disputes are not suitable for mediation, particularly where there is no scope for compromise – for instance where a point of law has to be resolved.

So what’s new?

Mediation is not new. It has been around for a number of years. What is new is the law’s ever embracing relationship with mediation. Over the years, the Courts have expected the parties to a dispute to mediate. Although it has, at least in theory, remained a voluntary process, the Court has increasingly enforced the concept by making adverse cost orders against those who refuse or fail to mediate without extremely good reason.

The Civil Justice Council (CJC) has just this month initiated a consultation process which appears designed to go even further by making ADR, and in particular mediation, compulsory in most civil disputes. Other areas of the law, particularly matrimonial and employment disputes, already have compulsory mediation. So why not other civil disputes, such as inheritance claims, property or boundary disputes?

The CJC is concerned that, on its own, the threat of adverse cost consequences for an unreasonable failure to mediate is not enough. The Court should be able to intervene in a dispute much earlier. A particular area of concern is disputes marginally above the current Small Claims Court upper range of £10,000.00. The CJC is not suggesting that the parties must settle, only that they should be compelled to at least actively try. Although currently in the minority, some in the CJC have suggested that mediation should be a pre-condition of actually starting Court action or a formal trial.

How useful is mediation?

All in all, mediation is another ingredient to be added to the dispute resolution melting pot. Any of us in the Coodes Dispute Resolution Team will be able to give you many examples of mediation in practice.

It is interesting to see that a mediator has just been appointed in the current dispute between the Royal Mail and the Communication Workers Union. In a statement, the Royal Mail has said: “Mediation will bring both parties together, with a third party, to seek the right outcome for employees, customers and the business.”

Well, if it is good enough for such a major dispute, it could no doubt help with most of the smaller civil disputes that arise. And in any event, in future you may be left with no option.

For further details, please contact Darren Higginson in the Personal Disputes Team at Coodes Solicitors on 01726 874 700 or darren.higginson@coodes.co.uk

Fri 27th Oct 2017

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