A decision in the Court of Appeal this year reinforces the necessity of acting proactively and swiftly once an agreement to mediate has been made. Once parties have decided to mediate, delaying the process whether out of apathy, misgivings about the likelihood of a successful outcome or otherwise, can result in the Court imposing heavy penalties.
In Thakkar v Patel (2017) EWCA Civ 117, the Court of Appeal imposed costs sanctions against the party who had “dragged its heels” in arranging the mediation which ultimately led to the other party abandoning the process entirely, and the case ultimately being resolved in Court.t. Whilst the Defendant had not refused to mediate outright ( which may in itself be considered unreasonable, and can lead to Court imposed penalties), its actions led to the Claimant losing confidence of a settlement being reached through the process.
The sanction imposed in Thakkar demonstrates that the Courts will expect both parties to positively engage in the mediation process and any obvious absence of engagement by either party will merit a penalty in costs.
Mediation is a process we often recommend at DMH Stallard as part of our dispute resolution services. For more information on the process and benefits to engaging with alternative dispute resolution you can read James Colvin’s “Beginners Guide to Mediation” here.