Docklands Solicitor

Latest legal news from Docklands Solicitors, Kaslers Solicitors LLP.

Wednesday 13 July 2011

THE IMPORTANCE OF MEDIATION

It is a known fact that litigation is an expensive process. Most often the parties involved in litigation, whether they win or lose, notice that they have spent far too much in the process and wish if there was a way they could have avoided the legal expenses.

The courts being cognizant of costs in litigation have always encouraged the parties to participate in mediation and to find mutually-agreeable solutions to their conflicts.

Mediation has many advantages. The mediation process generally takes much less time and it far less expensive than litigation. It is also a confidential process. No one except the parties involved in the mediation and the mediator know what has gone in the course of mediation. In addition, mediation is a flexible process and the result is achieved by negotiations among the parties in dispute. This is unlike a court order which is imposed by a judge which may be unsatisfactory for all the parties involved.

The disadvantage of mediation is that it is not binding and the parties can walk away from it at any point during mediation.

The mediation takes place with the aid of a mediator who is a neutral third party. A good mediator is trained in conflict resolution and in working with difficult situations.

Under current rules, the loser has to bear the costs of litigation but this is subject to the court’s discretion which takes into account (a) conduct of the parties and (b) efforts made during proceedings to resolve the dispute. Thus the refusal of a party to engage in mediation has always been regarded by the courts to have adverse costs consequence for the non-participating party.

In a recent case, the above principle was reaffirmed by the court. The case involved a householder in dispute with a builder over the construction of a garage which costs some £50,000. The householder made offers of settlement both before and after the proceedings were issued and made it clear that she was willing to attend mediation. No reply was received. The householder made further offers of mediation throughout the proceedings that was again left unanswered.

At the trial, the court awarded damages of £2,500 to the builder but the court refused to make an order for costs against the householder. The court held that the householder made repeated offers for mediation which has been ignored and the facts indicated that mediation would have had reasonable prospects of success.

Alireza Nurbakhsh Solicitor - telephone 0845 2701511

Labels: Adverse Costs Order, Dispute Resolution, Mediation

# posted by michael @ 09:00 0 Comments

Saturday 2 July 2011

Non-party costs order

In a recent case, the judge ordered non-parties to pay the successful Claimant’s costs.

Proceedings were issued by M against C a company. C was insolvent and unable to fund a defence to the proceedings. Several of C’s shareholders, having an interest of their own to protect, agreed to fund the defence and took an active part in controlling the litigation by taking major decisions themselves.

The Court held that four of the nine shareholders had not played an active role in the defence and were not liable to contribute to the costs ordered to be paid to M. However, the Court found that the remaining five shareholders had taken a decision to fund the defence and in doing so were acting outside their usual role in the ordinary run of cases. They Court ordered that they were jointly and severally liable for M’s costs.

Care should be taken when agreeing to fund litigation and if necessary legal advice sought as to the possibility of a non-party costs order being made.

Felicity Keeler: Senior Paralegal Civil Litigation: telephone 0845 270 2511

Labels: costs, fund, litigation, non-party, order