What is mediation?
Mediation is a flexible, voluntary, and confidential form of alternative dispute resolution, in which a neutral third party (a ‘mediator’) assists parties to work towards a negotiated settlement acceptable for both sides. The trained mediator will listen to all views, talk to both parties privately and come to a mutually agreeable solution. Mediation can help preserve your commercial relationships. Settling a dispute through an adversarial court battle can put added pressure on the relationship between both parties.
The Mediation agreement will usually require the parties to treat all discussions and documents as confidential and without prejudice. This means that what is said or written cannot be used in later proceedings if the mediation does not settle (with some limited exceptions).
Mediation can take place at any time before your case reaches a hearing or trial at court, and the best time will often depend on your individual case.
It is best to try mediation as soon as you can. This will help reduce the amount of time and money spent on the dispute and open a dialogue with the other party before they become too fixed in their position.
Advantages of Mediation
The legal costs can be reduced substantially through mediation. Progressing and settling a dispute through court proceedings is particularly expensive. The overall costs can be extremely unpredictable and with barristers’ fees and court fees, the legal costs can soon outweigh the amount in dispute.
As well as being significantly cheaper, mediation can also save you considerable time and stress. Court dates are usually scheduled way in advance, and you could find yourself waiting years before you get into court. While a mediation date can be arranged within months or even weeks.
Whilst mediation does not guarantee you will resolve the dispute, the fact that no binding decision is made, means that both parties have more control over the solution, and are not forced to accept an outcome in which they are not satisfied. If you take a matter to Court, you are stuck with the decision of the Judge (subject to appeal). We also often find that if a dispute does not settle at a mediation, it may well settle shortly afterwards.
As of 1 October 2023, amendments to the Civil Procedure Rules for England & Wales will see a new regime of fixed recoverable costs (FRC) in all fast-track claims (i.e., up to the value of £25k) and for a separate FRC regime to apply to claims that are valued in excess of that but less than £100k. The higher value cases will now proceed to a new track, the intermediate track, and will be subject to new fixed cost rules. In view of the new regime, it would seem that now is a better time than ever to consider mediation as an alternative form of dispute resolution as, even if you go to Court and win your claim, you will only be able to recover a fixed amount for your legal costs and this will likely be a lot less than what you will have paid to your legal team.
If you have any questions regarding meditation or believe that you have a dispute that could be settled considerably cheaper and quicker using mediation and would like some assistance, then please contact a member of our commercial litigation team on 01254 828300.