It’s time to mediate

It’s time to mediate

The Ministry of Justice (MoJ) has recently confirmed that mediation will soon be compulsory for civil claims valued up to £10,000 (small claims track), with changes coming into effect during 2024. This will see mediation become more common in most small claims proceedings.

Compulsory mediation
Compulsory mediation will apply only to specified money claims, but it will eventually expand to all small claims i.e. claims up to £10,000.

In terms of how this will look in practice, a Claimant will bring proceedings in the usual way, however when a defence is filed and the case allocated to the small claims track, the parties will be advised by the court that they must now mediate.

The parties will complete a directions questionnaire (a document used by the Court to determine how to allocate the case) and the claim will move to the Small Claims Mediation Service where mediation appointments will be offered within 28 days.

Crucially, the mediation will be free, and the parties will have a separate 1-hour long telephone conversation with a mediator. If a settlement is agreed, a legally binding formal agreement will be recorded with the court. If agreement is not reached, the dispute will be heard by a judge in the usual way. The judge will be able to impose sanctions on parties that did not comply with mediation. The sanctions could include automatically ruling in one party’s favour or ordering that one party pay part or all the other sides legal costs.

Pros and Cons
There are a number of advantages of mediation including claims being settled more quickly and at less cost to the parties when compared to litigation. Also, compulsory mediation may remove the stigma of being the first party to propose it, which might encourage more parties to engage in mediation.

In terms of downsides, forcing parties to mediate where it is clear the parties will not reach an agreement may lead to time and resources being wasted.

While compulsory mediation will only apply to cases up to £10,000 for now, it is likely that the MoJ will increase the scope to higher value claims up to £25,000 (fast-track) and possibly those over £25,000 (multi-track).

While compulsory mediation may not be to everyone’s liking, it is ultimately a positive step by the MoJ and should help parties resolve disputes more effectively and alleviate pressure in the court system.

If you are considering filing or defending a civil claim and would like a free initial consultation with a member of the Litigation team simply click on the “Speak to Our Experts” button on this page, call us on 01244 356 789 or email info@cullimoredutton.co.uk

Please note: This is not legal advice; it is intended to provide information of general interest about current legal issues.