What is mediation?
This post will act as a guide to mediation for people with a legal dispute. Mediation is just one type of Alternative Dispute Resolution (ADR) which assists in settling a dispute out of court. There are many methods of ADR, at one end of the spectrum you find the non-adjudicative methods, and at the other end the adjudicative measures. Simply speaking adjudicative options involve another person deciding the outcome of a dispute whereas non-adjudicative options are settled by agreement of the parties.
Mediation is a non-adjudicative option where a neutral third party (the mediator) helps you reach an agreement. More information on adjudicative and non-adjudicative methods, particularly mediation and arbitration, can be found here.
When would you use a mediator?
You may want to sue someone, perhaps someone owes you money or has breached a contract. Besides that, there may be a dispute with your employer or a border disagreement with your neighbour. Whatever your legal problem, if the other party won’t fix it you have a right to take them to court. While how to take someone to court is an obvious question for your lawyer, considering alternative options is equally important.
Theoretically mediation can take place at any stage in a disagreement, however, for maximum benefit it is better to mediate sooner rather than later. In an ideal world the parties will have attempted to negotiate themselves, not only is this free but in the event the disagreement cannot be resolved both parties better understand their position. Most mediations take place once a party has commenced proceedings by issuing a claim form. At that stage the general issues the court has to decide are known and the mediator has somewhere to begin.
There are many benefits to mediating early, it saves more time and money and is most likely to be effective. When parties try to settle early, they are less entrenched in their positions and more open to compromise. That said, parties can still save a great deal when they mediate or settle at the ‘door of the court’.
As a provider of mediation services, we pride ourselves in helping both sides come to a suitable agreement. Ready to instruct us? Call or email today.
Advantages of mediation
Mediation has many advantages over litigation (going to court). I have identified six advantages of mediation that are common to all disputes: Cost, Time, Outcome, Confidentiality, Control and Relationships.
Cost
Mediation is cheaper than going to court. Most 1-day mediations will cost each party £750.00 + VAT. Contrast that with the fees involved for a ½ day trial and each party will likely save over £4,000. Additionally, you may lose at trial, in which case you are usually liable for the other side’s costs. Imagine you are suing for £20,000 you have spent £4,000 in fighting the claim and the other party wins. In that instance, you may be looking at £8,000 of fees (including theirs) to add to your £20,000 loss. See our case studies for examples.
Time
Mediation is quicker than going to court. Before the COVID-19 pandemic a straightforward case could take months to be listed for trial, now it is longer. A simple case, without the requirement for expert evidence or large amounts of documentation will take in excess of 6 months to be heard; it will join the backlog of over 1million cases for claims under £25,000.If you are owed even a fraction of that sum, or worse, more, any delay is likely to be difficult to bear.
Confidentiality
Mediation is confidential. Our jurisdiction practices open justice, most of the time what happens in court is a matter of public record. Unless the parties to mediation specifically agree otherwise, the matters discussed are confidential; they won’t make the newspaper! This is incredibly important to most parties. People and businesses care about their reputation and would prefer to settle a matter without risking that reputation. As mediation aims to result in a settlement, anything discussed between the parties cannot be used in court in the event settlement is not reached. This aspect of confidentiality, known as the without prejudice rule, means parties can be honest and make gestures to settle safe in the knowledge that good-faith offers cannot be used against them in a courtroom.
Control
The parties retain significant control compared to going to court. Once in a courtroom, there is only one person in charge, the judge. Everything follows strict procedure, including who can speak, when they can speak and what evidence can be heard. The hearing follows a strict timetable and, without permission from the court the hearing won’t be stopped because a party doesn’t like it. In the end, the judge makes a binding decision; it is not joint and it is not by agreement. Conversely, as mediation takes place by agreement and consent, the parties determine everything, including the time and place to mediate.
Relationships
Relationships are important to us all and going to court often ruins them. Imagine one of your biggest customers has failed to pay you, while you will want payment you will also want to keep their custom. You may have a dispute with your neighbour over a border, or work being done to their home; at the end of the dispute, unless you can afford to move, they will still be your neighbour. It is human nature that where possible we want to maintain relationships; mediation often enables this. As mediation focuses on a settlement by agreement often both sides can settle without either feeling hard done by or judged.
Outcome
The Outcome is key. It is not always obvious at first, but the court cannot give you everything you may want if you win. A judge is limited to legal remedies and cannot go beyond them, regardless of their apparent power. Sometimes a party just wants an apology, or a positive review on a website, a court cannot order that. Almost any outcome (that is not illegal) is possible with mediation, compared with very few outcomes in litigation.
Whether you have a solicitor or are acting alone I recommend the 6 benefits listed above are considered carefully.
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Mediation Costs
Mediation costs can vary, however, a dispute settled through mediation will invariably be more cost-effective than a court case. In most cases a one-day mediation will cost each party £750 + VAT; including reasonable preparation time by the mediator. A full breakdown of my costs can be found at my fee page.
Mediation Formats
Mediation can take a number of different forms, it can be conducted in person, over the telephone or online (Zoom). The choice of mediation is agreed by the parties in advance and the mediator will happily follow the party’s preferences.
Traditionally parties would meet face to face in a neutral venue, this is still possible but will incur additional costs over and above the mediator’s fees. Party’s will be responsible for the venue hire and would also have to take into account their own travel costs. There are also the ongoing COVID-19 restrictions to consider which has led many people to opt for online dispute resolution (ODR)
ODR, or online mediation, is a proven and effective method of resolving disputes which has many advantages over traditional in-person sessions. The mediator meets each party online via a platform such as Zoom and conducts the mediation entirely remotely. Just like traditional mediation there are joint and private sessions, however there are no venue costs or travel time and fees to consider. Online mediation has become much more popular during the COVID-19 pandemic; the cost and time saving being an added advantage.
Telephone mediations, although possible, are only suited for very simple, low value disputes. The small claims mediation service run by HMCTS offers this mediation to suitable cases.
I want to mediate – how does it work?
All mediations follow broadly the same format, with a mix of joint and private sessions; ODR is no different. The general format is as follows:
- Joint opening session – including mediator, all parties and their lawyers if present
- Private sessions – the mediator spends time with each party separately, covering:
- Exploration Phases
- Negotiation Phases
- Joint closing session – including mediator, all parties and their lawyers.
The opening session allows the mediator to introduce everybody, set the ground rules and afford each party to give a brief understanding of the case from their own perspective. The mediator will explain the confidential, without prejudice nature of all discussions and encourage parties to be full and frank with their ambition to settle the dispute.
The private sessions serve many functions, they allow each party to speak in more detail about the problem and how it affects them. The mediator will encourage each party to think about what it would mean to settle the dispute during the mediation and to avoid the hassles of court. Parties will also be encouraged to think about how they may be willing to settle and what it is they want the most.
The private sessions remain completely private unless a party specifically asks the mediator to pass information or an offer to the other side.
Your mediator is trained to ask difficult questions, sometimes acting as a devil’s advocate in reality testing each party’s position. At no stage are they taking a side or expressing a view about the strengths or otherwise of a party’s case.
At the appropriate juncture the mediator will ask parties to consider their firmer offers to the other side and, once each party is content the mediator will engage in ‘shuttle-diplomacy’ passing between parties to discuss offers.
Most mediations (over 90%) result in settlement on the day, at this stage all parties come back together for the closing session in which the offers are written up as ‘heads of agreement’ and passed to the party’s respective lawyers to finalise a settlement agreement. The mediator never signs this agreement, reinforcing their neutral position in the proceedings.
Why use a mediator?
You may be thinking ‘this seems straightforward, why use a mediator?’. The truth is, parties to a legal dispute often become entrenched in their own position and cannot break out of it alone as they feel to make offers would result in an injustice to them.
Mediators are trained negotiators and can assist you to come out of an entrenched position and understand what really matters in your dispute. They also assist you to weigh up the advantages of settling early and the potential dangers of continuing through to a court case.
What am I risking if I refuse to mediate?
It remains your right, in law, to have a claim decided by a court. Although the court will not force people to mediate The courts, however, consider litigation to be a last resort and expect parties to attempt to reach agreement without recourse to a trial.
In the best-case scenario, if you win, you will have lost some money. People often fail to realise that the court very rarely awards a winning party his or her entire costs. In that sense mediation will usually be cheaper for all parties (winner and loser).
In the worst case you may lose your claim, in this situation you are responsible for your legal fees, a substantial part of the other party’s fees and you have failed to recover whatever it was you sued for.
There is an additional risk that everybody should be aware of – cost penalties for failing to explore settlement options. If the court feels that one party has been unreasonable in refusing to mediate they can be penalised very heavily in costs, whatever the outcome at trial.
There are recent cases of winning parties paying out more in costs than they won and the courts are using these powers more readily than before. If you do not have a reasonable justification for ignoring alternative options to settle you must be prepared for a hefty bill on completion. The following article explains the position in greater detail.
How to find a mediator
There are many mediators in the UK, and your solicitor can assist you in shortlisting a number to choose from. Do bear in mind that as mediation is by agreement, both parties have to agree to the choice of mediator – this is why a selection of two or three different mediators tends to be a good idea.
If you are researching this yourself then rather than just searching ‘mediators near me’ or ‘mediation services near me’ I would advise searching for accredited mediators registered with an appropriate body. The Civil Mediation Council, where I am registered, is the UKs leading register of Civil and Commercial Mediators.
John-Paul is the principal mediator at DF Mediation and is registered and accredited by the Civil Mediation Council. To discuss this article or to book a mediation contact us here.