Posted by admin - April 24, 2015 9:00 am The power of Mediation

When two aggrieved parties have a dispute, which they are unable to settle amicably between themselves, they will most likely look to the courts to see justice. However, new legislation introduced last month by the Ministry of Justice now means a substantial increase in the fees which courts will charge to issue proceedings. Under this new legislation claims in excess of £10,000 will now attract an issue fee of 5% of the value of the claim, capped at £10,000, or to simplify, a claim of £150,000 will now cost £7,500 to issue proceedings in addition to any legal fees.

An alternative route which is often overlooked, but which can prove successful, is that of mediation. The process of mediation is carried out on behalf of both parties by a neutral negotiator with the benefits that arguments can often be settled faster and at a reduced cost. For example, a recent mediation case on a claim of £140,000 that our MFW Insolvency Team were recently involved in incurred mediation fees of approximately £3000 and with this sum split between both parties.

With the sharp increase in court fees it is therefore worth while considering the mediation route in the first instance. Should mediation fail to resolve the dispute with court proceedings subsequently issued then additional costs would, of course, be charged. However, in going through the mediation first both parties will gain a much clearer idea of where each party stands and the cards they hold before the court case starts.

If, however, a claim is near to being time barred under the Limitation Act then mediation will most likely not be an option.

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