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Mediation

Generally, once a party issues proceedings the potential for an early settlement is dead. There are exceptions to this - sometimes it does require the issuing of legal proceedings in order for the other party to wake up. But generally, if there is a deal to be reached, it is best done before the court is involved. Mediation is the best way to achieve this.

Settlement discussions can be either by way of formal Mediation – with a trained mediator going to and fro between the parties – or by a JSM – a joint settlement meeting. With a JSM, the parties do not have a mediator but agree to a bundle of documents, set aside half a day at one party’s offices and try to strike a deal. 

Because the likely legal costs for the average money claim of £100-£250k will by trial exceed £150,000, meeting to try and do a deal at an early stage, before much in the way of costs has been incurred makes sense. 

Mediation also allows other issues, which may not be capable of being litigated, to be brought into the final mediated agreement. Eg: in a right-of-way dispute, a new route may be agreed upon which neither side could have obtained by an application of the law. 

For mediation or a JSM to have the best chance of working the following is suggested:

  1. All expert reports are expressed to be for the mediation only and WP to trial.
  2. An agreed bundle of documents be prepared.
  3. Each side put in a short position statement.
  4. There be a draft agreement, left where necessary blank.
  5. Each side has a reliable estimate of its costs.
  6. The parties’ insurers remain contactable.
  7. There be three rooms available: one for each party’s team and one for negotiations.

Mediation between commercial concerns usually results in an agreement. Mediation between private individuals is less successful and fails about 30% of the time. This can be because the meeting is premature - the evidence necessary to quantify ahead of loss is not to hand - or because the parties have become dug in.

However, even where mediation fails, the issues can be clarified and one usually learns what (despite what is said) the other side will settle for.