Small claims mediation
Mediation is an effective way of resolving disputes and has many advantages over litigation. It can be quicker, less stressful and cheaper than going to court and has a high success rate with around 80 per cent settling on the day or shortly afterwards.
What is a small claim?
Any claim that has a monetary value of £10,000 or less. Claims that have no monetary value, such as where someone is looking for a declaration or an injunction, are not small claims.
Why is it important to know whether a claim is a small claim?
Because special costs rules apply. Unless there is something special about a case and a court otherwise orders, and it rarely will, no party to a small claim will be able to recover any costs of pursuing a claim even if they are successful. The almost invariable rule is that each party will therefore have to fund their own legal costs.
Aren’t small claims all pretty straightforward?
They can be. If a small claim relates to a simple issue, like non-payment of an invoice, it may be straightforward. However, the complexities in a case often bear no relation to the value involved.
What happens then?
If there are difficult legal issues, or even significant disputes of fact, the parties may well need lawyers. Lawyers mean legal fees, and the small claims rules mean that the fees will be irrecoverable.
Can’t a party to a small claim do without a lawyer?
Of course, but if one party employs a lawyer the other may feel that they have to. And they will still need to have enough understanding of the process to be able to conduct their case properly. Even without lawyers, the law will have to be applied by the court.
So will mediation be suitable in all small claims?
Mediation will not be appropriate for every claim; as there will be costs it may not suit very low value claims. However, even where there may be issues that can only be determined by the court, the parties are still expected to have tried to mediate or settle some other way. Courts now encourage parties to look at settling cases at every stage.
So what if a party just wants some advice on how to approach the claim?
Lawyers are supposed to look at other ways of approaching disputes, and most good lawyers will consider alternatives which may include mediation. The best advice to a party might be to look at an early resolution through mediation to save the hassle and expense of going to court.
Disclaimer: Please note that this fact sheet is for guidance only and is not intended to replace legal advice.