Court penalties for refusing mediation

Hello. I am Gemma, a legal assistant here at Lawyer Destroyer. I am happy to help you with your question about mediation in the courts of England and Wales.

To give you a short answer: yes, a court absolutely can penalise you for refusing to take part in mediation.

Legal position:

The courts in England and Wales strongly expect people to try and settle their differences without going to a final trial. Litigation should always be a last resort. If the other side suggests mediation and you flatly refuse, or if you completely ignore their suggestion, the judge will look closely at this behaviour when deciding who pays the legal costs at the end of the case.

Typically, the losing side pays the winning side's legal costs. However, even if you win your case entirely, a judge can decide to significantly reduce the amount of legal costs you can recover, or even order you to pay some of the losing side's costs, simply because you unreasonably refused to try mediation.

Recent changes in the courts:

The courts are becoming much stricter about alternative dispute resolution. Following a recent major Court of Appeal decision, judges now have the power to pause court proceedings and actually order the parties to engage in mediation or another settlement process. As long as it does not restrict your basic right to a fair trial, the court can compel you to at least try to talk it out.

Additionally, if your claim is a lower value dispute going through the small claims track, the court process is currently being updated so that a free, telephone-based mediation session will be an automatic and mandatory step before you can see a judge.

When a refusal might be considered reasonable:

A judge will look at all the facts to decide if you acted unreasonably. They might look at things like whether the cost of mediation would be totally disproportionate to the value of the claim, whether the other side is clearly just using it as a tactic to stall for time, or if there is severe urgency requiring immediate court action.

However, you should know that it is getting much harder to convince a judge that refusing mediation was a good idea. Simply believing your case is watertight and you are certain to win at trial is rarely accepted as a valid excuse to avoid mediation.

Practical next steps:

1. Do not ignore the suggestion. If the other side suggests mediation, acknowledge it promptly. Ignoring an offer is almost always seen as unreasonable by a judge.

2. Consider it seriously. Think about the benefits of mediation. It is usually much cheaper, faster, private, and far less stressful than a full court hearing. It also gives you a chance to agree on creative solutions that a judge might not have the power to order.

3. Explain your position carefully. If you genuinely believe mediation is not appropriate right now, you need to write back explaining exactly why in detailed, sensible terms. For example, you might suggest putting the mediation on hold just until a key piece of evidence has been shared, rather than rejecting the idea completely.

4. Keep an open mind. Even cases where parties are hugely far apart often settle at mediation. It is usually worth trying, if only to show the court that you have been reasonable, sensible, and co-operative.

I hope this helps make the court's approach to mediation a bit clearer. Please feel free to ask if you need anything else.