Deal or No Deal?

5th Jan 2018

It has recently been reported that TV presenter Noel Edmunds proposed settling a legal claim against Lloyds Banking Group for £10 million, only a fraction of the sum he has allegedly sought against the high street lender, but that Lloyds rejected that offer. The offer was reportedly made during the course of mediation talks, but what is mediation?

Mediation has become an increasingly successful method of settling disputes outside of Court, either during court action or before proceedings have commenced. Whilst, generally speaking it is not compulsory, it is now commonplace for Courts to expect parties to mediate and to impose costs sanctions upon those who refuse.

Against such a backdrop, a client will ordinarily be under very real pressure to agree to mediation, irrespective of their wishes. One of the most difficult decisions to make is when to mediate.

If you mediate too early in the process, the real issues in the case may not yet have crystallised and the mediation may well fail because neither party has enough information to make a reasoned decision about settlement. Mediate too late and the legal costs that have then accrued may make the case more difficult to settle. Unless a client had a very compelling reason not to mediate, mediation should not be declined. In terms of timing, it can be reasonable to defer to conduct further enquiries, collate additional evidence and have a site inspection, for example.

Mediation on the Small Claims Track (usually the track used for claims of £10,000 or less) is a free service offered by HM Courts & Tribunals Service. Such mediations are conducted via telephone but are not conference calls. The mediator will speak to one party, discuss the case and how they are willing to resolve the matter, then hang up, call the other party and do the same. The mediator will continue to go back and forth between the parties for the hour long session. If a settlement is agreed between the parties, the mediator will draw up an agreement reflecting that settlement. The agreement is then binding on both parties.

On larger value claims outside of the Small Claims Track, parties are still expected to mediate, but the Courts do not offer the free mediation service available on the Small Claims Track. In such cases, parties are under even greater pressure to mediate given that legal costs tend to be significantly higher. The usual process once both parties have agreed to mediate would be to agree between them upon an accredited mediator, who is an independent third party. The mediation meeting would take place at an agreed venue, often at the offices of the mediator or one of the party’s legal team. Each party is allocated their own room and the mediator passes between both in order to facilitate a settlement. If the mediation is successful, the parties are usually responsible for drafting a settlement agreement between them which is binding once signed by all parties.

Top Tips

  • Spend a few moments making a list of the strengths & weaknesses of your case and think about how and where you are able to compromise.
  • Work out your objectives and what is important to you and the concessions that you may be willing to make.
  • Assess the costs that you will incur in proceeding to trial and time that you will have to devote to the Claim.
  • If you have a 3rd party acting for you they must be fully aware of the facts of the case and have a good understanding of how far you are willing to compromise. You will be legally bound to any agreements the 3rd party makes.

The R&N litigation team is vastly experienced in mediation, with the knowledge, pragmatism and negotiating skills needed to ensure the best results are achieved for their clients. We understand when it is the best time to mediate and can actually conduct the mediation itself on behalf of clients.

The team is also experienced in Adjudication, Arbitration and has recently been instructed on a number of cases which are proceeding by way of Expert Determination.

For further information on Litigation and ADR contact Elizabeth Gibson at eg@rogers-norton.co.uk or 01603 675641.