Costs News

03 September 2015
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Mediation costs sanction should not apply when party changes mind

A party which initially refused to mediate a will dispute but then had second thoughts should not face a costs penalty, the High Court has ruled.

In Murray & Anr v Bernard [2015] EWHC 2395 (Ch) – which was handed down in February but only published recently – Mr Justice Mann was considering the costs consequences of the successful claim.

The defendant, acting for himself, said there should be no order for costs because the claimants failed to take an opportunity or to accept an offer to mediate, as recorded in an order in December 2013.

However, the judge said that it was “quite clear” from correspondence in January 2014 that the claimants indicated that they were by then prepared to mediate. “The reason that the mediation did not happen is that [the defendant] himself did not feel himself ready to mediate, although he wished to do so.”

Mann J continued: “This is, therefore, not a case in which it can be said that the claimants failed to mediate… Although the claimants originally refused to mediate, they have changed their minds. They are not be fixed with a once stated but changed intention in relation to mediation. The relevant question is not a game in which the claimants will have one and one opportunity only to mediate for the purposes of the cost rule.

“The reasons why a party may be penalised for a wrongful refusal to mediate is because parties are not be encouraged to decline to take opportunities to settle cases. The claimants having expressed their view, they changed their minds and decided to mediate. Accordingly, they cannot be criticised for refusing to mediate.”

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