When a commercial dispute arises, many people’s first reaction is to sue – or to use the correct legal language, litigate. After all, they have a legal agreement or contract in place to protect them in these circumstances, so they decide it’s time to instruct TM Law to commence litigation proceedings and get them what is legally theirs.
At TM Law, we understand that clients may want their “day in court” where the facts of the case will be laid out, judgement will be made, and they will hopefully be awarded what is due to them. If that is their wish, then we are always happy to oblige as it’s something we enjoy doing and we are also particularly good at. However, we do always take a moment to help our clients understand that litigation may not necessarily be the right solution for them, and an alternative route does exist.
The reason we do this is that litigation is an expensive, stressful and time consuming process for our clients. There are court fees to consider, which can be up to £10,000 or 5% of the amount they are claiming. There will be a hearing fee of £1,100 they must pay. They will need to pay TM Law’s fees to get their case to court, and they will need to pay a barrister to represent them in court. They will also need to spend their own time helping prepare the case, answering questions, making statements, finding documents, emails, other correspondence, and doing various other things, so that everything is ready when the time comes for the case to be heard.
However, that is unlikely to be anytime soon. At present, it takes a year, or longer, for a case to come to court, and that’s assuming there aren’t delays, postponements, or a rescheduling along the way. But even when their case does finally come to court, there are never any guarantees they will win as even the most solid of cases has, perhaps, a 20% litigation risk of being lost because of some unforeseen point arising in the case.
That is why TM Law always ensures its clients carefully consider whether the time, stress, and expense involved in litigating a commercial dispute is ultimately worth it, or whether they might first wish to consider the route of mediation.
Unlike litigation, mediation can help resolve commercial disputes quickly, with less stress and far less cost. A mediation involves a professional mediator collaborating with both parties in the dispute to resolve, or narrow, issues and disagreements. The mediator’s aim is to bring the parties to some sort of agreement in order to resolve the underlying commercial dispute. If both parties are willing to participate in a mediation, it can be arranged, and take place, within a few weeks and the costs are a fraction of those involved in litigation as court fees, hearing fees and barristers are not required.
In practical terms, each party is sat in a separate room, often with their Lawyer, and the mediator moves between the rooms acting as an intermediary, providing suggestions and feedback between the parties in the hope of finding a solution which is acceptable to them both, whilst not imposing any decision on any parties, or trying to persuade them to agree to anything they do not want to do. As mediation is a largely informal process, it means that solutions are often found which a court would not consider.
The fact that the parties are not face-to-face, not in a court setting, have not spent many expensive and stressful months getting to this point, and have a skilled mediator working with them, means that mediation can be a relatively stress free process. It is also an incredibly successful method of dispute resolution, with around 90% of mediations resulting in disputes being resolved.
If, or when, agreement is reached in a mediation, it is typed up and signed by all parties and becomes legally binding. If one party then does not comply with it, the other can enforce it in court.
If, however, agreement is not reached, then litigation can still take place, with anything said in the mediation remaining confidential and unusable in court proceedings.
Of course, it is important to remember that litigation and mediation aim to achieve somewhat different outcomes. Litigation may ultimately prove you right, and get you what you deserve, but you can pay a heavy price in terms of time, stress, and money to achieve it. Mediation, on the other hand, aims to resolve a dispute, but you may have to compromise, and accept an outcome which is not necessarily ideal, but is something you can live with, and allows you to quickly move on.
TM Law Ltd is a member of the Solicitors Regulation Authority, the regulatory body for solicitors in England and Wales.