For nearly 20 years the courts followed a decision in Halsey v Milton Keynes General NHS Trust [2004] EWCA Civ 576 which was widely understood to prevent judges from forcing unwilling parties to take part in mediation, in order to protect the right to a fair trial.
What is business mediation?
Business mediation is a confidential process in which parties attempt to resolve a dispute through discussion and negotiation with the assistance of an independent third-party (a mediator), rather than waiting for a court to decide the outcome.
An impartial mediator assists the parties with:-
- Identifying the key issues in dispute;
- Exploring possible solutions; and,
- Working towards a mutually acceptable outcome.
The position changed on 1 October 2024, when the Civil Procedure Rules (CPR) were amended following the Court of Appeal decision in Churchill v Merthyr Tydfil County Borough Council [2023] EWCA Civ 1416. The rules now make clear that courts can not only encourage, but in some cases order, parties to engage in mediation or another form of alternative dispute resolution.
How would this affect a claim?
Business mediation can be raised at any stage
Judges can now encourage or order mediation at any point during court proceedings. Although mediation is often discussed at the outset of a claim, it can also be organised later. This would likely occur if the parties need to narrow down any issues in dispute. This, however, also means that the parties would have already invested time and legal costs in progressing the case.
It is therefore important for clients to be aware from an early stage that mediation may form a part of the court process.
Potential costs consequences
Whilst parties cannot be forced the settle, the courts now have wider powers to impose cost sanctions on parties who either unreasonably refuse to engage in mediation or who do not attempt mediation in their best efforts.
This makes it crucial to take a considered approach. Simply declining to mediate without apparent reasons can create unnecessary risk, even where a party believes they have a strong case.
Early engagement often puts you in control
Reaching a settlement can save significant time, costs, and uncertainty. Engaging with mediation at an appropriate stage can help avoid a late intervention by the court, when the timing and structure of mediation may be outside your control.
It must be noted that mediation is not appropriate in every case, and progressing to trial may sometimes be the right strategic decision. Recent case law confirms this, despite the courts’ strong encouragement of mediation. In Grijns v Grijns & Ors [2025] EWHC 2853 (Ch), the High Court made clear that parties may reasonably decline mediation where a claim is very weak, settlement demands are unrealistic, or the process would serve no genuine purpose and risks being used tactically. The court emphasised that its focus is on the parties’ overall conduct, rather than a simple refusal to mediate, and that there should be no automatic cost penalty where a decision not to mediate is properly justified. The key message is that mediation remains central to modern litigation, but it must be approached with informed judgment, and decisions for or against it should be strategic, proportionate, and well-reasoned.
How Moore Barlow can help
Mediation works best when clients are properly advised, prepared, and supported.
At Moore Barlow, we help clients by:-
- Advising whether mediation is appropriate for your dispute and at what stage;
- Identifying when the court is likely to expect order mediation;
- Preparing you thoroughly so you understand the risk, opportunities, and likely outcomes;
- Representing you during the mediation process to protect your position; and,
- Ensuring any agreement reached is legally sound and in your best interests.
Mediation is now a central part of the court process, not an optional extra. Understanding how and when it may arise can help you manage risk, control costs, and make informed decisions about your dispute.
If you are involved in, or considering court proceedings, early advice from our Business Dispute Resolution solicitors can make a significant difference to how your case is resolved.
