Mediation is a popular form of alternative dispute resolution (‘ADR’). There are others including arbitration, adjudication and expert determination. Mediation is an attractive option to parties in dispute for a number of reasons including that it is confidential, non-binding and is held on a without prejudice basis – what is said in the mediation room, stays in the mediation room.
Mediation can be used at any point when you are in dispute, whether that is before or during the issue of a claim at court. Different considerations would come into play though depending on the timing of the mediation.
Why would you mediate when you are in litigation?
Most lawyers will tell you, for many reasons, that you should always keep alternative methods for the resolution of a claim under review throughout its duration. Settlement discussions, offers, without prejudice meetings and ADR (including mediation) should be continually assessed and the merits of engaging considered. If you don’t, not only could you lose an opportunity to resolve the matter before the costs of advancing through the litigation process are incurred, but you could be penalised on costs.
How much is mediation?
This can vary considerably depending on the dispute, the parties, the mediator, who attends and how long it takes – there are no fixed rules, but costs can always be scoped.
Can mediation be avoided?
Prior to the recent case of Churchill v Merthyr Tydfil County Borough Council [2023] EWCA Civ 1416 most resources would tell you that mediation is voluntary and no one can force you to enter into the process. Failing to do so might need to be justified and could carry cost consequences, but it was still your decision to agree to it or not.
That has now changed as a result of this case and the decision will potentially have wide reaching effects.
In this case the court was being asked to consider what power the courts have to order parties to engage in ADR i.e., what power it has to stay proceedings and refuse to remove the stay until the ordered ADR process takes place.
In short, the unanimous decision was that the court can order the parties to engage in ADR and can stay proceedings to ensure that happens, provided it is proportionate in the circumstances to make that order.
What do I need to be aware of?
The Churchill v Merthyr Tydfil decision has potentially wide-ranging implications and many will not yet be known. Given the strain on resources in the courts, seeing early settlement achieved through mediation will take some strain off those resources.
In terms of the benefits to parties, this is difficult to judge as each case is different and assessing whether a mediation would be successful, or a complete (and costly) waste of time, can be complicated.
What sort of property related disputes might this apply to?
It appears that this decision applies to all claims and the court will likely make use of its discretion to make such an order, wherever it appears appropriate to do so.
There are no particular restrictions, so when it comes to property disputes this principle of ordered mediation may apply in all court forums including more specialist courts such as the First tier Tribunal (we envisage this could be particularly applicable in service charge disputes for example) and the Upper Tribunal (for example in telecommunications matters).
How Moore Barlow can help
If you have a question concerning how court-ordered mediation might affect a property related dispute you may have, do contact one of our specialist Property disputes team.
Working collaboratively with our commercial disputes and transactional real estate colleagues, we draw on a breadth of experience and expertise to provide you with a service of the highest quality.
We have considerable experience advising commercial landlords, developers, lenders, commercial tenants, private individuals and landowners.
