Mediation -FAQs

The questions most often asked before a mediation concern what the process is, whether it is confidential, whether it can be compelled, what follows a refusal and when a settlement binds. Each answer below rests on the rules and the decided cases.

What is mediation?

Mediation is a negotiation conducted with the help of a mediator. The courts treat it as a form of without prejudice negotiation. In Brown v Rice the court put the point in a single sentence.

Mediation takes the form of assisted without prejudice negotiation.

Brown v Rice & Patel [2007] EWHC 625 (Ch), [13]

The mediator therefore assists; the mediator does not adjudicate. At Legatia Law the mediator does not advise either party, does not determine the merits and does not impose an outcome. The decision whether to settle, and on what terms, remains with the parties.

Is what is said in mediation confidential?

Two separate protections apply. The first is without prejudice privilege. It belongs to the parties, not to the mediator, and the parties may waive it.

This is a privilege which exists as between the parties and is not a privilege of the mediator. The parties can waive that privilege.

Farm Assist Ltd v Secretary of State for the Environment, Food and Rural Affairs (No 2) [2009] EWHC 1102 (TCC), [44(2)]

The second protection is confidentiality. It usually arises from the mediation agreement, and it binds the mediator as well as the parties. The mediator may enforce it even where the parties themselves agree to disclose what passed.

Even if the parties agree that matters can be referred to outside the mediation, the mediator can enforce the confidentiality provision.

Farm Assist (No 2), [44(1)]

Neither protection is absolute. The court will order or permit evidence of confidential matters where it is necessary in the interests of justice. In Farm Assist itself the parties had waived privilege, and the mediator was required to give evidence, because one party sought to set the settlement aside for economic duress ([53]). The purpose of the rule explains its limits. In the Supreme Court’s words, the principle is “to encourage parties to speak frankly and thus to promote settlement” (Oceanbulk Shipping & Trading SA v TMT Asia Ltd [2010] UKSC 44, [41]).

Can the court require the parties to mediate?

It can. The Court of Appeal settled the question in 2023.

The court can lawfully stay existing proceedings for, or order, the parties to engage in a non-court-based dispute resolution process.

Churchill v Merthyr Tydfil County Borough Council [2023] EWCA Civ 1416, [58]

The rules now say so expressly. Since 1 October 2024 the court may “order the parties to engage in alternative dispute resolution” (CPR 3.1(2)(o)). The power has limits. An order must not impair the very essence of the right to a judicial hearing, and it must be proportionate to the aim of settling the dispute fairly, quickly and at reasonable cost (Churchill, [65]).

What if a party declines to mediate?

A refusal may cost money. When the court decides what order to make on costs, it considers the conduct of the parties. That conduct now expressly includes “whether a party failed to comply with an order for alternative dispute resolution, or unreasonably failed to engage in alternative dispute resolution” (CPR 44.2(5)(e)). Silence is treated no more kindly. The Court of Appeal has held that silence in the face of an invitation to mediate is, as a general rule, of itself unreasonable (PGF II SA v OMFS Company 1 Ltd [2013] EWCA Civ 1288, [34]). The authorities are examined in The Cost of Refusal.

When does a mediated settlement become binding?

Usually only when it is written down and signed. Mediation agreements commonly say so in terms.

Any settlement reached in the mediation will not be legally binding until it has been reduced to writing and signed by, or on behalf of, each of the Parties.

Clause 1.4 of the mediation agreement in Brown v Rice, [24]

In Brown v Rice the court applied that clause and held that the proceedings had not been settled at the mediation ([53], [64]). Where proceedings are on foot, a signed settlement may then be recorded in a consent order. The rules provide for “the stay of proceedings on agreed terms, disposing of the proceedings, whether those terms are recorded in a schedule to the order or elsewhere” (CPR 40.6(3)(b)(ii)).

Is every dispute suitable for mediation?

Not every dispute is suitable. Most disputes, however, are not by their nature unsuitable for it. The Court of Appeal has accepted that mediation is “not appropriate for every case” (Halsey v Milton Keynes General NHS Trust [2004] EWCA Civ 576, [16]). It added that “most cases are not by their very nature unsuitable for ADR” ([17]).

This article is general commentary on the law of England and Wales at the date of publication. It is not advice on any particular matter.