It takes 2 to tango – mediation is not yet compulsory!

Mediation is now a well-used tool in the dispute resolution process.

At an early stage, in most cases, the parties are encouraged to consider mediation, and at the end of a case the judge can, with the benefit of hindsight, impose costs penalties on a party that is found to have unreasonably refused mediation.

However, mediation is not suitable in all cases

This was the view of our clients in the case of a long running dispute amongst siblings in which their father, who set up the trust, died almost 30 years ago.

The original trustees had been replaced in earlier litigation and the professional trustee appointed as a replacement, in an effort to break deadlock and achieve a resolution, made an application to seek the Court’s approval for a scheme to deal with some valuable land which forms part of the trust property.

Our clients were happy to see the Court approve the trustee’s proposal, but two of the siblings took the decision to apply to the Court to force the trustee and the other beneficiaries to mediate the dispute.

This was despite earlier refusals by the applicants themselves to mediate.  They argued that mediation can now be mandated by the Court, although there is an earlier Court of Appeal case which says it cannot.

The applicants said that despite the history of the matter pointing against mediation, the time was now right for the High Court in Leeds to say that it had the power to mandate mediation and to force that upon all parties.  We argued that whilst judicial thinking might be changing, and even if the Court now had such a power, this was completely the wrong case to order the parties to mediate.

The Court refused the application. 

The applicants sought permission to appeal from the High Court but that was refused.  They were ordered to pay costs to the other parties in excess of £78,000.

Undeterred the applicants applied to the Court of Appeal seeking permission to appeal, arguing that the judge had been wrong and in any event, the issue of whether mediation could be forced upon parties was so important that an appeal ought to be heard.

This application was turned down by the Court of Appeal.  The judge deciding the application said, “Although I accept that the question whether the court has power to order compulsory mediation is an important one, I agree with the Respondents [Schofield Sweeney’s clients] that this is not a suitable case to test the proposition. It is clear from the judge’s judgment …….that she considered that even if she had the power to order mediation, she would not have exercised that power”.  He went on to say that an appeal had no prospect of success.

Mediation can be very effective in resolving disputes, but it is not a ‘one size fits all’ remedy.  It must be considered in each case.  The Court of Appeal is likely to consider the issue of compulsory mediation later in the year and the concept is likely to be part of the landscape for lower value cases sooner rather than later.

Need advice dealing with a dispute that calls for mediation? Whether it’s navigating through complexities or finding the right approach, we’re here to help – get in touch