Mediation in property disputes

Sam Andrews, property litigation specialist at Brady Solicitors, examines mediation as route to resolving property disputes and explains how the process works.

Mediation can save costs and time for both parties and should be considered in the early stages of a dispute. It offers both parties a chance to mutually resolve the dispute and is especially useful where working relationships need to be maintained.

Importantly, you are obliged to consider mediation as an alternative to taking proceedings to court, as contained within Part 1 of the Civil Procedure Rules. This is to ensure proper use of the court’s limited resources, which are publicly funded.

Refusal to mediate could mean sanctions

Whilst mediation is said to be voluntary, parties must be made aware that any refusal to mediate can have severe financial circumstances if the matter goes to court and judgment given.

Recent case law shows that even when a party is successful at a hearing, they may be refused payment of their legal costs if they refused to mediate without good reason to do so.

On the other hand, a losing party who is already obliged to pay legal costs, can be ordered to pay additional costs on top by way of a penalty if they refused to mediate without good reason.

As such, parties should always consider mediation and, if the court has specifically recommended mediation, then it must be sought to avoid costs sanctions. However it goes without saying that mediation is only suitable where both parties are willing to compromise.

Mediation can take two forms:

  • Using an appointed mediator or;
  • Through the small claims mediation service.

Using an appointed mediator

This is where an independent and specially qualified third party is appointed as a go-between, usually for a period of one day. Mediators are appointed on a neutral basis and must not influence any decision ultimately made between the parties.

The process can involve a round-table meeting with all parties but, more often than not, parties will sit in separate rooms with the mediator acting as an intermediary. The mediator will discuss the matter with each party, with the aim of reaching a negotiated settlement.

An appointed mediator will usually assist by drawing up the agreement reached for this to be signed at the mediation itself by the parties to be bound by it.

Whilst there is a cost involved with having an appointed mediator, this is usually outweighed as the discussions can be more easily controlled and the mediation structure maintained.  The cost of the mediator would be shared by both parties.

Small claims mediation service

This is a free telephone mediation service offered by the courts for those claims with a value below £10,000. The First-tier Tribunal (Property Chamber) also offers a mediation service.

‘Without prejudice’

All mediation is on a without prejudice basis.

This means that, should mediation fail and the case end up in court, any matters discussed during mediation cannot be referred to in the subsequent court proceedings.

Problem solving approach to property disputes

Mediation can be particularly useful where there is a relationship to preserve, as it gives the parties the opportunity to speak openly and discuss all the circumstances – this allows the parties to understand each other better when emotions get in the way.

At Brady Solicitors we always try to find a resolution to not only settle the proceedings, but also help the parties move forwards together or at least part amicably. Contact our property dispute resolution experts on 0115 985 3450 or click here to contact us.

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With hundreds of years’ worth of combined experience, our experts have dealt with nearly every leasehold property matter you can imagine. If you’re currently in need of legal support or advice, please get in touch.

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