Civil & Commercial Mediation – The future of legal disputes?
29 October 2015 by Lauren Hancock
With Court hearings listed months in advance and the ever increasing costs of taking a matter to trial, it is clear that in many instances mediation is a more cost and time effective option. In 2009, Lord Justice Jackson recognised mediation as the most important form of Alternative Dispute Resolution for matters which do not settle by way of bilateral negotiation. Despite this, whilst the mediation of civil and commercial matters has significantly increased since 2003, from less than 2,000 cases to almost 10,000 (with over 1.4 million civil claims bought in the Civil and Magistrates courts in 2013 and over 43,000 of these proceeding to trial), there is undoubtedly a much larger number of cases suitable for mediation where the parties do not utilise this option.
There are many recognised benefits to mediation; savings in costs, time and stress; flexibility in settlement; privacy; maintenance of the relationships between parties; and overall satisfaction in the terms of settlement, as noted by Lord Neuberger in his speech “A View From On High”.
Contrary to popular belief, mediation of both civil and commercial matters can and does lead to settlement in a great number of instances. A 2014 survey of mediators demonstrated that of all mediations undertaken, over 75% settled on the day and a further 11% shortly thereafter. Whilst some may be reluctant to mediate, on the basis that unsuccessful mediation results in further delay and cost, this level of success demonstrates the potential to avoid litigation in many cases and makes mediation an attractive option for clients.
It is widely accepted that mediation can be a more economically viable approach to dealing with disputes, described as “infinitely less expensive” than litigation, by the former president of the London Solicitors Litigation Association. Access to justice is slipping further from the reach of private individuals, who cannot rely on infinite funding in order to progress a matter through the Courts. At present the relevant fee, purely for the issue of a civil claim can be as much as £10,000.00, a daunting figure for a private client who has no guarantee of success. Comparatively, the average cost of a novice mediator (for a one day mediation) in 2014, was £1,422.00. Whilst admittedly, even in the case of mediation, there are additional costs to be accounted for, this clearly allows for greater access to justice.
It is not only private clients who can benefit in this manner; mediation can be equally as cost effective in matters of a commercial nature. In 2014, businesses saved some £2.4 billion through the utilisation of mediation over litigation.
Economics aside, mediation of a matter can also provide a resolution to disputes more swiftly than the litigation of an equivalent case. Between July and September 2014, the average period between the issue of a claim and trial was 56 weeks. In contrast, mediation can be arranged at the convenience of all parties involved and scheduled at almost any stage of proceedings. It is entirely possible that relationships between parties, broken down through the course of a 56 week litigation, would be better preserved if the matter was expedited through utilisation of mediation.
Mediation is also of benefit to parties involved in a dispute on a more “personal level”. Agreement in mediation can be constructed to meet the unique and specific requirements of the parties involved, not always possible for a Judge deciding a matter at trial. Outside of an often stressful Court room environment and with no “loser” as such, when successful, mediation has the potential to provide an increased sense of involvement and personal satisfaction in the outcome for all involved.
With the Jackson Reforms placing such great emphasis upon achieving greater proportionality in costs versus damages claimed, in many instances mediation could be the means of meeting this objective. Whilst it would be over optimistic to suggest that mediation is a suitable approach in all cases, the utilisation of mediation by parties on a wider scale would relieve a burden on the Courts and improve overall effectiveness for the remainder of cases, which continue to be dealt with by way of litigation.
If you would like further advice in resolving a civil legal matter, but are discouraged by the prospect of a potentially lengthy and costly litigation, please call us on 01206 700113 or email [email protected]
Alternatively, should you require further advice in relation to a commercial mediation please contact Tony Fisher, on 01206 835230 or at [email protected], or Beth Baird on 01245 584515 or at [email protected].
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