UK: Mediation – The Threat From The Courts

Having been one of the pioneers of commercial mediation in the UK, I am alarmed by a recent development or perhaps phenomenon. This is the intervention of the judiciary at an early stage in the mediation process leading to a serious fear on the part of some lawyers that the privilege of the process is under attack.

ADR Group, one of the two main providers of commercial mediation services in this country, is beginning to come across cases where the Judge is making an order prior to the mediation to the effect that he wants to know what goes on and, impliedly, if not expressly, if there is a lack of proper participation, then there will be an adverse costs or some other sanction. Examples of the sort of wording in these orders are:

‘Without prejudice to the confidentiality of the process, the parties shall report to the Court on the result of the mediation, whether it has settled and if not, why not’. Another example is "the Claimant’s solicitors do by … lodge at Court an agreed report on the outcome of the mediation, and if the mediation has not been successful (without prejudice to privilege and confidentiality) the reasons for this."

Mediation is a voluntary without prejudice confidential process, it is not voluntary without prejudice and confidential by accident or for light hearted relief. Those elements are central to the concept of the process which is assisted negotiation.

Litigation is an adversarial process where each party takes as many points as it can and seeks to persuade a decision maker, the Judge to decide in its favour. The parties put forward their best points and try to hide or gloss over their worst points. A mediation is very different. There is no decision maker other than the parties themselves. Typically, they have been locked into combat with the other side, putting forward their best points and hiding their worst points. They do not always have a realistic view, therefore, of how strong or weak their case is and what the likely outcome at trial might be. It is the job of the mediator to help them understand the strengths and weaknesses of a case in order to properly assess the risk of proceeding with litigation compared with reaching a settlement. It is vital that the mediator is given an environment which is free from the risk of unwanted exposure of weak points. It is only in that environment that the mediator can gain the confidence of each side in order to discover from them where the real issues lie. The mediator can then help the parties in trying to put together a settlement.

The parties need to communicate fully with the mediator, in order for him to be able to assist their negotiations. He or she needs to be able to develop trust which comes in part from personal qualities and in part from the nature and confidentiality of the process. If, for example, the process is completely open, then the parties will naturally fear that in disclosing important matters which they don’t absolutely need to disclose, they will be weakening their hand for the litigation which might ensue, if settlement cannot be achieved. They will clam up and the mediator will find it very difficult in many cases to generate a realistic discussion and even less a realistic pattern of negotiation.

The Civil Procedure Reforms (CPR) have emphasised proportionality and the importance of not incurring more costs than are appropriate for the size and nature of the case. Also fundamental is the behaviour of each side. Judges naturally want to know exactly how each side has behaved to help them make their decision both on the main issues and costs. However, in the matter of the confidentiality of mediation, they must be invited to think carefully and respect this fundamental feature of the process. Faced with these orders or possibly, after the event demands from the judiciary for information, lawyers are now wondering whether it is safe to advise clients to go to mediation. The CPR already brings about front end loading of costs which can itself be a detriment to mediated settlement in some cases. Let us hope that in a fit of righteous zeal some judges do not deliver a serious blow to what has become a positive development over the last few years, the recognition that mediation forms an integral part of the justice system.