Shall I litigate or mediate? Options to consider when faced with the choice of a Judge or a Mediator

The days of hearing “I want my day in Court” have reduced with the reality of no guaranteed success and the fact that even a court room victory does not secure full recovery of the legal costs.

It is rare for a successful claimant to be reimbursed all of their legal fees. If the defendant opts to go into administration to avoid paying a judgment debt, then the likelihood is that the neither the judgment nor the costs will be paid and the proceedings would have been an expensive option. The successful claimant could also face costs assessed by the Court and find those costs reduced to a recovery rate, potentially ranging between 60-85% of the fees incurred and paid. All of a sudden, the decision to place the issues before a Judge becomes costly not only in terms of time and energy, but financially too.

Sometimes it can be the only option available when a party to a dispute will not engage in any form of negotiation. When this happens, it is important to keep considering the proportionality of proceeding to Court and not get carried away with what may be the moral high ground. Reputation can lead some companies to push ahead regardless so their suppliers and customers are aware that they are a force to be reckoned with, yet most businesses and individuals have to take a commercial view even when it’s hard to do so.

So, if there is a litigation risk and that risk relates to the claim itself as well as the recovery of costs, what can reduce that risk?

Mediation is an option.

There is no third party Judge to make the decision for the parties and instead the parties can use the facilitation skills of the mediator to find their best alternative to court proceedings. The creativity of parties, not the rigidity of the law, dictates the settlement. A mediation meeting can be organised quickly without waiting for a Court timetable and the costs can be much less than those incurred in taking a case to court. It is flexible and the parties can decide the issues that are relevant to them as part of their decision making process. Few like to be told what to do and mediation enables the parties to decide their own course with factors that are relevant to them.

If faced with the decision to litigate or mediate, it is worthwhile considering what you want to achieve and your negotiation strategy, as well as your future plans. Having to hand the answers to the following questions will also assist:-

• How much will it cost to a) take the case to Court b) mediate?
• How long will it take to a) get a court hearing or trial b) a date for mediation?
• Is your opponent likely to agree to mediate before you issue court proceedings?
• What plans do you have over the next few month/years and how could these be impacted by a) a court case b) mediation?
• How will you fund a) a court case b) mediation?
• If you are a company, who else within the business may need to be involved in the case and to what extent will this distract them from their current job? Will this be cost to your business?
• Are there solutions available to settle the dispute, that a court could not award, that may be acceptable to both parties?

The court process is not a flexible one and follows a strict set of rules. Mediation is flexible and can work around the parties’ needs and interests. There is a place for both when seeking dispute resolution, although it is always important to consider the implications of your choice.

For further advice and assistance please contact our Private Client Team on 01604 828282 / 01908 660966 or email info@franklins-sols.co.uk