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Transforming the intractable into the possible.

The case of Ali Ghaith v Indesit Company UK Ltd appears unremarkable. The judge dismissed a claim by an employee, who then appealed. The Court of Appeal overturned the original decision, proving again that going to court can be something of a lottery.

However, the Court of Appeal, added a postscript which is of interest to anyone considering litigation.

Lord Justice Longmore commented:

It is a great pity that Indesit did not pursue the option of mediation rightly encouraged by Toulson LJ when he gave permission to appeal.  Mr Peebles informed us that it was not pursued because the costs had already exceeded the likely amount in issue.  This is an inadequate response to this Court’s encouragement of mediation since a full day in this Court will inevitably result in a substantial increase in costs.  …  It is devoutly to be hoped that such mediation will mean that these comparatively small claims will not have to be adjudicated by this Court so frequently in future.

Lord Justice Ward added:

When this Court grants permission to appeal, it does so because there is a real prospect of success.  That does not mean that the appeal will succeed, but it does mean that the appeal is by no means hopeless.  That should tell both parties that there is still all to play for.  If they have any sense, they will therefore heed a recommendation to mediate because the costs of mediation are likely to be exceeded by the costs of the appeal by a significant margin.  It is not enough, as Mr Peebles suggested, that there had been some attempt in the correspondence between solicitors to settle the case.  The opening bids in a mediation are likely to remain as belligerently far apart as they were in correspondence but no-one should underestimate the new dynamic that an experienced mediator brings to the round table.  He has a canny knack of transforming the intractable into the possible.  That is the art of good mediation and that is why mediation should not be spurned when it is offered.

Reading between the lines suggests that the costs of the action had greatly exceeded the value of the claim to such an extent that the legal teams for the parties were unable to contemplate a compromise which could affect their cost recovery. Mediation, early in the process, can assist in keeping legal costs to a minimum in any event, but it is clear that judges are strongly in favour of mediation at any stage and a suggestion to mediate is ignored at your peril.

Please join the discussion below : what is your response to “judicial encouragement” to use mediation?