Plans have been put in place to introduce compulsory mediation for all claims with a value below £10,000 which are allocated to the Small Claims Track in the County Court. It is thought that the proposal will eventually lead to the introduction of compulsory mediation for Fast Track cases valued between £10,000 and £25,000 and, eventually, Multi-Track cases worth £25,000 or more.
The Court’s mediation scheme will involve a court employee conducting a series of calls with the parties with a view to trying to facilitate a settlement but it is not clear if extra funding will be made available or if litigants will be asked to contribute towards the cost as they do with mediation scheme in the County Courts in London.
There are no exemptions to compulsory mediation scheme and all cases allocated to the Small Claims Track will be subject to the scheme. If one party does not attend a mediation that has been arranged, the court would be able to apply sanctions or even strike out that party’s case.
During the consultation leading to the implementation of the new scheme there were some suggestions that the mediator be asked to confirm to the Court whether the parties participated in the negotiations in good faith but this proposal was not implemented possibly because of the conflict of interest that this could give rise to.
Mediation undoubtedly has the potential to lead to comparatively quick and cost-effective settlements but it remains to be seen if the scheme serves to reduce the backlog of cases in the County Court or if compulsory mediation will create new bottlenecks which means that it takes claimants longer to obtain judgment in cases where there is no tenable defence.
The Government has elected not to introduce regulation of the mediation sector which might serve to restrict who might act as a mediator or the qualifications that an individual will need to obtain. Parties who agree to appoint a mediator will therefore need to make sure that they have a suitable professional background and have obtained training from recognised bodies such as the Civil Mediation Council.
In the writer’s experience, mediation is most likely to be effective if both parties approach it in the expectation of reaching a compromise. When litigants fail to mediate, the result might only be an increase in the cost of pursuing a civil claim.
Alex Haddad is a qualified mediator and works in Nockolds’ litigation department. Alex has represented many clients at mediations and is happy to discuss any questions that you might have (ahaddad@nockolds.co.uk / 0203 892 6805).