How do parties recognise the correct time to mediate? asks Jonathan Pratt
Is there a right time to mediate? If one side refuses to mediate until shortly before trial, should that party be penalised in costs? Can mediation take place too early? These issues were considered in the recent High Court case of Nigel Witham Ltd v Smith and another [2008] EWHC 12 (TCC), [2008] All ER (D) 101 (Jan). The underlying dispute related to fees for the design and project management of building works at a hotel. At trial, the defendants were awarded damages of £1,683 in respect of one of their counter-claims. This sum was dwarfed by the defendants’ claim for £123,000 in costs.
The claimant sought to persuade the court to depart from the general rule that costs follow the event by relying on the ruling of the Court of Appeal in Halsey v Milton Keynes General NHS Trust [2004] EWCA Civ 576, [2004] 4 All ER 920 that a party to litigation who unreasonably refuses to engage in mediation may be penalised in costs. This principle
