Currently, the Civil Procedure Rules provide that parties should consider whether negotiation or some other form of Alternative Dispute Resolution (ADR) might enable them to settle their dispute without commencing legal proceedings. Parties are also expected to continue to consider the possibility of settling at all times, including after proceedings have been started. An unreasonable refusal to participate in ADR could lead to the court ordering the refusing party to pay additional court costs.
Whilst ADR is not currently compulsory, it is evidently encouraged by the court.
At present, after a claim has been issued, both parties will be given the choice of whether or not to participate in the free Small claims mediation service. A mediation appointment will only be booked if both parties agree to participate in mediation.
The proposed changes would result in a claim being automatically referred to a mediator appointed by HM Courts & Tribunals Services. The Small claims mediation service will be a free hour-long telephone session. Parties do not speak to each other directly. All communication is made through the mediator.
If an agreement cannot be reached by the end of an hour of telephone “ping pong”, then the claim will proceed as normal. If an agreement is reached, the mediator will prepare a legally binding settlement agreement for both parties to sign.
The proposals aim to reduce the court backlog and assist with resolving disputes promptly and more cost-effectively.
The consultation remains open for 10 weeks. Watch this space!
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