The small claims mediation service has been running since 2007.

HMCTS introduced a test whereby it changed how parties in small claims, indicate whether they want to engage in the small claims mediation process or not. It did it for claims issued using the Online Civil Money Claims. So not claims commenced using the County Court Money Claims Centre or Money Claims Online.

They changed the question about whether the parties want to engage in the small claims mediation service, from opt in to opt out. It was a subtle change and perhaps to seek to whether people bother to read the directions questionnaire properly.

The Outcome

The findings show there was only a slight increase in the uptake of the service, from 17% to 21%. I was surprised to read just how low the take up is given that the service is free. The report shows that Claimants (people starting the claim) were more keen to mediate than the Defendants (those responding to a claim).

It requires both the Claimant and Defendant to agree on using the small claims mediation service, for it to go ahead.

In time, it may change to impose mediation on the parties regardless of whether they want it or not. I think that will be problematic as if imposed, some people might just go through the motions to tick the box. For those that don’t engage, much will depend upon the sanctions the courts can impose.

The report notes that the information provided to the Claimant and Defendant, explaining what mediation is, was improved at the same time as the pilot scheme. It might be that the greater explanation enabled people to understand better what it is and its benefits, and in turn then decide whether to go ahead with it.

Why People Don’t Want To Mediate

The report also looked into the reasons why people opted in or out for small claims mediation.

One of the main reasons was either a party wanting their day in court (so not interested in exploring mediation or settlement) or not wanting to go to trial (so keen to settle to avoid it).

Another main reason for people not wanting to engage in mediation was the all or nothing mindset. They didn’t want to compromise and make concessions to reach a deal. They believed they should and would win and would not strike a deal to get the certainty of an outcome, even if for a reduced amount.

The lack of any likely cost sanction in small claims does mean that the parties often push things to trial to see how they get on. Unlike other civil claims, in small claims it is very rare for the court to order one party to pay another party’s legal costs other than court fees, capped expert witness costs and limited witness expenses.

As solicitor and barrister costs are unlikely to be ordered against a party, the Defendant may be minded to stand its ground and see how it gets on.

People Not Understanding What Mediation Is

A big problem with the legal system, is that it isn’t terribly friendly to non lawyers. Nor is it easy to get information and understand how everything works. That is why we set up this site over ten years ago.

“Mediation” isn’t a phrase everyone will be familiar with. If you don’t know what it is, how can you be expected to decide to agree to it or not?

Feedback from mediators in the small claims mediation service, was that people who engaged in mediation often did not really understand what it was, what would happen during the appointment and what the role of the mediator was.

The mediation appointment takes place by telephone and is usually limited to an hour. Mediators having to explain the process and answer questions about it, eats into the time available for the substantive mediation efforts themselves.

A mediator is impartial and is there to help the parties explore, and ideally reach, terms of settlement. Mediators are often confused with the Judge so asked to declare or give an opinion on who is right or wrong, who will win, what level of offer they should be making, whether to settle for the terms offered, or asked questions about the law. The mediator cannot get into those issues, as that is not its role.

How Successful Small Claims Mediation Is

The report records that 29% of cases which go to mediation, actually settle during the appointment. That is higher than I expected. Perhaps given that both parties agreed to go into mediation, they are both of the mindset it is better to settle or at least give it a go.

We recommend that parties engage in the small claims mediation service.

It doesn’t cost anything other than time. If terms can be reached, then a stressful and time consuming trial can be avoided. Also, by reaching terms, you achieve certainty of the outcome, rather than risking going to trial and seeing what the Judge decides.

If it doesn’t result in settlement , then nothing has been lost other than the time of the appointment and any preparation time.

You can read the full report and findings here.