The court system has introduced compulsory small claims mediation.
All defended claims for money, of a value less than £10,000, and commenced on or after 22 May 2024, issued using traditional paper claims or using Money Claim Online, will be referred to small claims mediation. The new compulsory mediation does not yet affect claims issued using Online Civil Money Claims but that will not be far behind.
It has always until this point, been the case that mediation was voluntary and required both parties to agree to it, for it to be arranged.
The move to compulsory mediation is likely driven by a desire to reduce the number of claims that go to trial and which in turn require the time of a Judge involved. There are only so many hours in a day and only so many Judges in the courts up and down the country, to get through claims.
There is a backlog of civil claims in the courts and more claims going to mediation, and ideally settling, will mean less of them go to trial.
What is Compulsory Mediation?
Traditionally, mediation is a voluntary process where a neutral third party (the mediator) helps disputing parties to discuss potential settlement or to narrow the issues. Ideally, a mediation will result in terms being reached to compromise the dispute. Compulsory mediation will require parties to engage in mediation before the court case can proceed through the court system towards trial.
The mediation appointment takes place on the telephone over the space of an hour.
The Phased Rollout of Compulsory Mediation in Small Claims
The change to compulsory mediation is being implemented in two stages:
Stage 1 (In Effect): As of May 22nd, 2024, mediation became mandatory for new small claims filed on paper through HMCTS legacy systems. This includes claims submitted through:
- Money Claims Online (MCOL)
- Secure Data Transfer (SDT) for bulk customers
Stage 2 (Upcoming): The requirement to mediate for claims submitted electronically through Online Civil Money Claims (OCMC) will be introduced at a later date. Until then, OCMC claims will continue with the current voluntary mediation system, where parties can opt-in or opt-out of mediation.
HMCTS Efforts to Enhance Mediation
To support the rollout of compulsory mediation, HMCTS has taken steps to improve the Small Claims Mediation Service:
- Increased the number of mediators and administrative staff.
- Enhanced internal appointment booking systems.
- Worked to increase referrals to mediation under the existing voluntary arrangements.
The Pros and Cons
Pros:
Faster resolution: Mediation can often be quicker and less expensive than a court case. For many small claims, a faster resolution could be a significant advantage. Typically, it takes a year for a small claim to get to trial.
Improved communication: Mediation can encourage better communication and understanding between parties, potentially leading to a more amicable outcome.
Reduced court burden: By diverting some cases to mediation, compulsory mediation could help alleviate the pressure on already overloaded court systems.
Cons:
Unwilling participation: If a party is unwilling to participate constructively, compulsory mediation may not be effective and will delay a matter being given a trial date.
Complexity of some cases: Certain small claims may involve legal complexities that are better suited for a judge’s expertise to resolve.
We recommend downloading our Ultimate Guide for assistance with the small claims process, including the mediation process.
