Mediation and Arbitration - Dispute Resolution

  Frequently Asked Questions

What is Mediation?

Mediation is a process in which a third party, the Mediator, assists the parties to reach a settlement of their dispute.  Their settlement, not a decision imposed on them by the Court.

Does Mediation work?

Yes.  It is difficult to be precise as to the percentage of cases in which Mediation succeeds in achieving a settlement but it is thought to be over 80%.  David Ellwood has an excellent success rate.

How does it work?

The parties enter into a Mediation Agreement, agreeing to mediate their dispute in good faith, to try to reach a settlement.

Then they, or their Solicitors, send the papers to the Mediator, queries are clarified and a Mediation Meeting is arranged.

If agreement is reached at the Mediation Meeting, it is recorded in a Settlement Agreement or Tomlin Order (an Order concluding any Court proceedings) and that's it!

What does it cost?

Less than you might think and much, much less than Court proceedings.

The cost depends on the size and complexity of the Case.  David Ellwood charges in accordance with the National Mediation Helpline Scale of Fees for Cases which fall within the Scale's framework.  For more involved Cases, a fee will be agreed tailored to the individual circumstances. 

How long does it take?

David Ellwood tries to arrange the Mediation Meeting 3-4 weeks after he has been appointed - long enough to deal properly with the preparation but short enough to maintain the initial momentum.

The Mediation Meeting itself may be no more than 1/2 day for a straightforward Case, though a full day is probably the norm for most disputes.  More complex Cases, particularly multi-party cases, may take longer.

Why is Mediation successful?

There can be many reasons why parties become embroiled in a dispute they cannot resolve.  Often perceptions cause misunderstandings, which harden into entrenched positions.  Once positions have become entrenched, the parties themselves cannot unlock the dispute.

Parties know that reaching a settlement of their dispute makes sense and that their unwillingness to give Mediation a chance might be reflected in the award of all or some of the costs even against a successful party.  Enlisting the assistance of a Mediator enables them to remove that risk and the other risks of litigation and reach a settlement without losing face.  A win-win situation.

David Ellwood believes that, once the parties have entrusted their dispute to him, he must work with them to try to reach a settlement and that ethos and thorough and careful preparation help to keep his settlement rate high.  

Will it be seen as a sign of weakness?

No.  Your opponent should know that the Courts see Mediation as an integral part of the resolution of disputes and have encouraged it for some time.  The principle that the unwillingness of a party to try to reach a settlement by Mediation might be reflected in the award of costs the Court makes at the end of the Action is now well-established.

Lord Justice Ward tackled this concern head-on at the end of his Judgment in the Court of Appeal in the Case of Egan v Motor Services (Bath) Limited [2007] EWCA Civ 1002:

"It is not a sign of weakness to suggest it.  It is the hallmark of commonsense.  Mediation is a perfectly proper adjunct to litigation.  The skills are now well-developed.  The results are astonishingly good.  Try it more often."

And the Allocation Questionnaire which parties, or their Solicitors, have to complete in Court proceedings has been revised recently to try to ensure that Mediation is considered properly as an alternative to the dispute going to Trial.

When should Mediation take place?

In many cases, the sooner the better, before positions become entrenched.  But once they have, Mediation has the best chance of success when both parties know the other's case fully but before the costs have escalated towards a Trial.

In Nigel Witham Ltd v Smith and Isaacs [2008] EWHC 12 (TCC), His Honour Judge Peter Coulson QC (now Mr Justice Coulson) said:

"It is a common difficulty in cases of this sort, trying to work out when the best time might be to attempt ADR or mediation.  Mediation is often suggested by the claiming party at an early stage.  But the responding party, who is likely to be the party writing the cheque, will often want proper information relating to the claim in order to be able to assess the commercial risk that the claim represents before embarking on a sensible mediation.

A premature mediation simply wastes time and can sometimes lead to a hardening of the positions on both sides which may make any subsequent attempt of settlement doomed to fail.  Conversely, a delay in any mediation until after full particulars and documents have been exchanged can mean that the costs which have been incurred to get to that point themselves become the principal obstacle to a successful mediation.

The trick in many cases is to identify the happy medium:  the point when the detail of the claim and the response are known to both sides but before the costs that have been incurred in reaching that stage are so great that a settlement is no longer possible."  

A Practice Direction under the Civil Procedure Rules "Practice Direction - Pre-Action Protocols" sets out what steps parties should take at an early stage of a dispute, before proceedings are commenced, to seek information from and to provide information to each other about a prospective legal claim.

 Its objectives are:

                (1) to encourage the exchange of early and full information about the prospective legal claim,

                (2) to enable parties to avoid litigaion by agreeing a settlement of the claim before the commencement of proceedings,

                (3)  to support the efficient management of proceedings where litigation cannot be avoided.

Lord Justice Ward, in Egan, advocating mediating at an early stage, said:

"The cost of such a mediation would be paltry by comparison with the costs that would mount from the moment of the issue of the claim.  In so many cases, and this is just another example of one, the best time to mediate is before the litigation begins." 

What is the next step?

Contact David Ellwood by phone, by e-mail or by completing the Contact Form on the Contact Us page of this Website.  He will talk through with you what should happen after that and will guide you through the process.

A few weeks, a modest cost and a settlement you have agreed yourself?  Or an expensive and stressful day in Court with no idea of the outcome?  Was the expression "a no-brainer" invented for this situation?

TAKE THAT FIRST STEP NOW AND TAKE CHARGE OF YOUR DISPUTE!