MoJ head of dispute resolution says mandatory mediation could be extended to higher value claims.

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The Ministry of Justice has not ruled out mandatory mediation for higher value county court claims, a senior official confirmed last week as the MoJ prepares to roll out a new requirement to mediate in low-value money claims this month.

Speaking at a Westminster Legal Policy Forum conference on ‘next steps for dispute resolution’, MoJ head of dispute resolution policy Kim Wager pointed to the success of a Canadian mandatory mediation model.

She said: ‘We haven’t ruled out mandatory referral to mediation for higher value claims in the county courts, so those over £10,000. It seems to work well in Ontario in Canada; they have had it in place for over 20 years now. [It covers] all cases that go to the court… including personal injury, as well as money cases. That remains of interest as a potential model to develop a mandatory mediation arrangement in England and Wales.’

Meanwhile for money claims worth under £10,000 filed on paper or through traditional online systems on or after 22 May, the MoJ is piloting a requirement for parties to attend a free, one-hour telephone mediation arranged through the small claims mediation service (SCMS) before the claim can then proceed to court if no settlement is reached. This will be extended to all small money claims under £10,000 later this year, including those submitted through the Online Civil Money Claims (OCMC) service.

The number of claims dealt with by the SCMS will grow from 20,000 annually under the current voluntary service to 92,000 per year, with 39 new mediators already recruited.

Wager said: ‘Even [with] the automatic referral to the free small claims mediation service, for which parties had to opt out, takeup rates were still only around 21% of cases. So we concluded that the only way to move the dial on this and drive takeup would be to require it; to make mediation an integrated step in the resolution journey, which includes penalties for non-compliance.’

She added: ‘Some of our consultation responses told us that mediation had to be voluntary, that mandating it would not work. We’re going to monitor this very closely to see if the settlement rate dips below the level of voluntary settlement which currently stands at around 52%. It will be interesting to see if it dips, and by how much and for how long.

‘The impact assessment that we published modelled a 15 - 55% settlement rate… and we estimate this would free up between 1,400 and 5,200 sitting days; between 9% and 32% of all county court sitting days. So it would release a significant amount of resource for those cases that do need to go before a judge.’

Wager said the MoJ welcomed the Court of Appeal's ruling in Churchill v Merthyr Tydfil Council last November that a court can lawfully stay proceedings and order parties to engage in non-court dispute resolution. She said: ‘The senior judiciary has been very encouraging and if this practice is widely embraced across the judiciary, it could prove a better mechanism to ensure the engagement of parties and to drive up the uptake of dispute resolution than a blanket mandated approach.’

The MoJ official pointed approvingly to one judge in Bedfordshire who has established an informal relationship with two mediation providers and the Royal Institution of Chartered Surveyors to facilitate mediation in home improvements disputes, for example between a householder and their kitchen fitter.

She added that Churchill has also ‘spawned’ greater interest from the judiciary in ‘judge-led mediation’, in which parties must attend a judge-led session that sits somewhere between mediation, early neutral evaluation and conciliation. ‘The senior judiciary are very interested in that, we’re aware that it happens in some of the tribunals, particularly in the employment tribunal and property chamber of the first tier tribunal. We are looking very closely at the success rates and the way that it is conducted, because there is a wider applicability of that kind of approach,’ she said.

Also speaking at the conference, Law Society head of justice Richard Miller said he opposed blanket mandatory mediation in principle but had ‘more sympathy for the concept’ in small claims, as unrepresented litigants may need guidance on how to avoid a full hearing. For represented parties however, he said: ‘Proceedings are supposed to be a last resort, and that is how most solicitors use them. So directing forms of dispute resolution after the issue of proceedings risks duplicating effort and wasting costs… [There is] a risk that ministers make policy based on their knowledge of court cases, and not on any knowledge of what happens in the vast majority of cases that don’t actually reach the courts’.

Miller also warned: ‘We now have a vast pre-action landscape in which unregulated providers proliferate. They are also encroaching ever further into the post-issue landscape by framing what they do as “support for litigants in person”. This opens up all sorts of questions around consumer protection… which have not been addressed directly because this issue has arisen as a byproduct of other reforms rather than as a deliberate choice.

‘This is an area that requires extensive further consideration to strike the right balance in the public interest.’