Mediation – A summary of what to expect

By Claire Darby, Partner in Dispute Resolution

In the summer of 2022, I attended 4 mediations for clients.  Two of them were for contested probate matters and two others were debt claims.  All the mediations ended in a settlement and ultimately brought an end to the ongoing disputes that the clients had been dealing with.  I hope this article might be useful to those who are considering whether to go ahead with mediation and what to expect.

What do I expect on the day of mediation?

Expect a long day is the first thing I always tell clients.  Don’t arrange to pick up the children, don’t expect to be able to make a dinner date.  Even if the mediation finishes early, you will undoubtedly be exhausted from the pressures of the day.

I have found with my recent experience that plenary sessions, which used to be how many mediations began, are happening less and less.  A mediation used to start with all of the parties sitting round, the mediator introducing themselves and the day, and then each party had an opportunity to say what they wished to the other party.  Often this was done by the parties’ legal representative and they used it as an opportunity to “peacock” in front of their clients and show off their “legal” feathers in front of the other side, rather than gaining anything towards the day.  You won’t be surprised I am not disappointed to see these phased out.

Nowadays most mediators have used the lack of a plenary session to just get started on the day a bit earlier, which can only be a good thing.  They will usually go to each party to introduce themselves, if they haven’t done so at an earlier date, and find out what they wish to achieve for the day.  They will set down the ground rules and explain their approach.  They will begin the task of shuttling between the parties to try to achieve compromise.

Will the mediator act as Judge?

No.  Their role is not to tell you what they would do if they were a Judge at the final hearing of your dispute. They are not actually there to give an indication of what they believe the correct outcome will be, or should be.  The mediator may, if they have the legal expertise to, guide you about what you may expect to see if the case went to Court. They may draw on their own experience of cases they have worked on, as often they are ex-solicitors or barristers.  However, they may not always have that experience. Therefore their guidance will be more focused on other areas.

What kind of things will the mediator focus on?

They may give their thoughts on the strengths of your claim and give an indication of the weaknesses to the other side.  However, this will be in relation to advising you about when to be flexible with offers and when perhaps a harder line can be taken.  They will discuss the risks of taking the case forward, which may be issuing Court proceedings or continuing with Court action, and the costs involved.

One of my clients’ claims was worth £200,000.  This, it was explained by the mediator, was his best case scenario.  However, no case, no matter how strong it is considered, should be given anything more than a 60% chance of success by their solicitor.  That is because we have to factor in a number of multiples and factors and things can always go awry.  Their costs to trial could be £100,000.  Even if successful, you might be looking at recovering 60-70% of those costs.  So therefore, they will already have lost £30,000-£40,000 even if they win.  There was a chance that the client could win the whole £200,000, or that figure could be reduced down by the Judge to only part of their claim.

So they have a 60% chance of recovering £200,000 and deducting that sum by £30-£40k which they will have to pay towards their own costs or a 40% of losing everything, paying 100% of their costs and 60-70% chance of the other side’s costs.

When you look at it that way, you can see why so many mediations end in settlement.

What settlement can be achieved?

Anything.  Which is what makes mediation such a useful tool in a litigator’s armour.  Whereas if you go to Court, the Judge has a very fixed discretion as to what they can award.  At mediation, you can include in the settlement anything the parties wish, such as one party giving an apology to the other or other ancillary matters which may not form part of the actual dispute.  One of my clients owned another property with the other party.  Their relationship had broken down from the litigation, so it was sensible to work into the settlement what the parties wished to do in relation to that other property to achieve a clean break.  That wouldn’t have been possible if we had gone to trial, as those properties were not in dispute.

When should mediation be done?

I am a big fan of mediations to solve disputes.  However, the timing is critical and it is not a good idea to do it too early.  I recently saw a client who had been offered mediation in the first letter he had received from the other parties’ solicitors.  They had not outlined what their client’s claim actually was or what is was based on.  My advice to him was that mediation would be a good way of resolving his claim, but he could do not so until the other side had actually proved their claim and let him know what evidence it was based on.  Otherwise he could end up being ambushed at mediation and spend the day exchanging points about the facts surrounding each other’s cases. However, it is a good idea for this to be done before the day of mediation to avoid wasting time on the day.

I would say that mediation is best suited to when each party knows what the other side’s case is and it has become clear that compromise cannot be achieved through correspondence.

How much does mediation cost?

That depends in part on the cost of the mediator and how long the mediation goes on for.  Mediators can charge from between £750 plus VAT to £3,000 plus VAT in my experience.  The costs are lower if they don’t have travel and accommodation costs, so either they are local or it is done virtually.   My costs are based on my hourly rate and how long the day takes.  In terms of preparation work, parties will usually exchange position statements which set out their position to the other party and the mediator, which can take a few hours to prepare. There is also usually a mediation bundle, which is a bundle of key documents which are sent to the mediator so they understand what the dispute is about.  This is usually agreed between the parties and then prepared by the Claimant or Applicant of the claim.  The costs and time spent preparing for mediation are ultimately money well spent if Court proceedings can be avoided or, if proceedings have already been issued, they are stopped in their tracks.

In summary, I think mediations are an excellent tool if done at the right time and with the right representative.  My approach is to offer sensible, pragmatic advice to clients which will often mean suggesting reasonable compromises.  However, it is also important to know when to draw the line and not accept unreasonable suggestions from the other party.  This is when years of experience of negotiations are key.

If you feel you have a dispute which would suit mediation or you have been offered a mediation, please feel free to contact me on cdarby@pearsonhards.co.uk or 0208 949 9500 for a no obligation discussion.