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Compulsory mediation can work for low-value disputes, say lawyers

Forcing mediation on a reluctant party may not result in settlement but the process could see clients save ‘hundreds of thousands of pounds’

14 October 2016

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Compulsory mediation could work for low-value disputes, mediators have said, challenging colleagues to overcome the established view that the very essence of the process makes it a voluntary step.

One of three panellists at an event advocating the benefits of mediation, commercial litigator and mediator Stephen Walker, shocked the room when he called for mediation to be made compulsory.

‘Why not?’, Walker told Solicitors Journal afterwards. ‘Most people don’t want to go to court but have no choice. Many cannot afford it. Mediation is much cheaper. People are not sure what mediation is. When they taste it they like it.’

Provocative yes, but Walker’s proposition has legs. Forcing parties to sit down and discuss their matter over a day could see it resolved quicker, cheaper, and with less stress than if the case reached court.

The Centre for Effective Dispute Resolution (CEDR) estimated that the mediation market sits at approximately £10.5bn. In the last year around 10,000 cases went through mediation – an increase of 5.2 per cent on 2014. But with mediation already voluntary in civil cases, bar family matters, would making it compulsory prove beneficial?

Fellow panelist, Graham Ross, a lawyer and mediator and a member of the Civil Justice Council’s ODR Advisory Group, told delegates: ‘You can’t force people to agree anything obviously but I can’t see why, if they’re going to have the benefit of a highly experienced judge, then before they enjoy that privilege they should at least spend time with a mediator.’

One of the greatest incentives of mediation is that clients can take control of their situation in the company of a neutral mediator.

‘After all my years litigating I can’t imagine that it could be worse than spending three, four, five hundred thousands of pounds and being out of control of the dispute,’ added the third panellist, Eileen Carroll QC (Hon).

Carroll, CEDR co-founder and now full-time mediator, believes compulsory mediation can only benefit clients. ‘It should be part of the process that people get a chance to come in before they’ve even issued their writ to get a chance of understanding to see what they’re going into.’

Camilla Palmer, CEO and principal solicitor at Your Employment Settlement Service (YESS), supports mediation but she believes it should only be ordered if the parties agree and can afford the costs.

‘Forcing mediation on a reluctant party is unlikely to result in settlement. Commercial mediation costs are too high for most employees and for small businesses so funding would be required for those on low incomes,’ she said.

YESS was set up in 2014 with the aim of resolving employment disputes without litigation by providing affordable legal advice to employees and employers. Unlike mediation – which it offers as a separate service – the charity gives tailored advice and guidance to clients rather than being an impartial mediator.

Palmer believes engagement with resolution should be mandatory where mediation is one option but acknowledges that ‘early discussion between the parties may make mediation superfluous’.

Last year, Lord Neuberger gave lukewarm support for mandatory mediation and pointed to the success of the system in the US, Australia, New Zealand, and Scandinavia. He posited extending the compulsory Mediation Information Assessment Meetings (MIAMs) – introduced in 2014 in the majority of family cases – to smaller civil claims.

Charles Holloway, a former litigation partner at Eversheds and now mediator and litigation consultant at Consensum, said: ‘Compulsory mediation before trial is an interesting idea but we have to be practical and it’s not the panacea that everyone thinks it is.

‘The obvious cases it would be applied to are the small-value cases because the legal costs run up on those very quickly and become more expensive than the sum at issue. The small value claims clog up the courts so it would be sensible to mediate those if at all possible and they usually can be.’

The Woolf reforms and, more recently, the Jackson reforms have already changed the landscape of court processes and the costs involved forcing some law firms to take a financial hit and change their business models.

On the prospect of compulsory mediation being introduced, Helen Curtis, a barrister and mediator at Garden Court, said: ‘Lawyers would need to ensure their clients had the best mediation experience possible – which would have the advantage of clients recommending them and the prospect of repeat business. Some more education is needed for lawyers to perceive mediation as an opportunity rather than a threat.’

Speaking at a different event also hosted by Garden Court on the first day of Mediation Awareness Week, Lord Justice Briggs acknowledged that mediation was working well for small claims up to £10,000 and expects online dispute resolution to take centre stage in the coming years – a view reinforced in his review of the civil courts structure.

Referring to a mediation vacuum between low-value claims and big-ticket litigation, he urged lawyers to work with judges on finding a solution involving non-court based dispute resolution methods.

So should compulsory mediation be introduced? According to the former Lord Chief Justice, Lord Phillips, the problem lies in the voluntariness of mediation. In a speech in India in 2008 on the issue of alternative dispute resolution, he quoted the famous proverb: ‘”You can take a horse to water, but you cannot make it drink”. To which those in favour of compulsory mediation reply, “yes, but if you take a horse to water it usually does drink”.’ Eight years on, we could be just about taking this horse to water and watch it drink.

Matthew Rogers is a legal reporter at Solicitors Journal matthew.rogers@solicitorsjournal.co.uk | @sportslawmatt

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