Succeeding at Small Claims Mediation: England and Wales Showing How It’s Done

By: Donald L Swanson

Small claims mediation efforts often languish. Many small claims parties don’t choose to use mediation—even when mediation is offered at a reduced fee or without charge.

How can this be? It’s a mystery.

Some small claims mediation efforts, by contrast, are successful. Here’s an example.

High Volume Mediation Service in England and Wales—By Telephone

England and Wales have a Small Claims Mediation Service run by Her Majesty’s Court and Tribunals Service. [Fn. 1] The Service employs its own full-time mediators, who mediate a high volume of cases by telephone. The small claims eligibility limit began at £5,000 and then increased to £15,000.

–The Mediation Process

Here’s how a mediation works, under the Small Claims Mediation system:

• When a small claim is submitted, the parties are given information about mediation and asked whether they would be willing to use it;
• When both parties say they are willing to mediate, a booking request results;
• About 1,200 booking requests are received each month, of which the Service can only accommodate 35%;
• Mediation sessions are kept to an hour in length;
• A mediation occurs, on average, within 4.3 weeks of a booking being made; and
• Each mediator is expected to mediate 550 cases per year.

Here are the key mediation steps:

1. Mediator telephones defendant to explain the process, emphasize the need for a good faith effort at settlement, and explain that he/she will be telephoning back and forth between the parties every 5-10 minutes.
2. Then, Mediator telephones claimant to explain the same things, ask claimant to describe the claim, and summarize his/her understanding back to claimant.
3. Then, Mediator telephones defendant to summarize the claim as put by the claimant, ask for a response to the claim, summarize his/her understanding back to defendant, highlight any shared ground, point out issues that remain in contention, say he/she will go back to claimant, and ask defendant to start thinking about settlement possibilities.
4. Then, Mediator continues going back and forth, relaying offers, highlighting differences in position and common ground, asking parties to consider the strength of their case, highlighting best case and worst case scenarios if it went to court, emphasizing benefits of settlement, and highlighting possible disadvantages of a failure to settle.
5. If agreement is reached, a verbal agreement is made and is binding.
6. The verbal agreement terms are confirmed by an email from the Mediator.

–Analysis of results

As to settlement trends:

• Mediators aim to settle every case, but the settlement rates achieved (62% or more) are considered good performance;
• Cases involving two companies (rather than two consumers or a consumer and a company) are more likely to settle;
• The key driver for settlement is a desire to avoid time and cost of the court process; and
• While cases of higher value are commonly seen as more suitable for mediation – here the opposite is true: the lower the value of the case, the more likely it is to settle, even though monetary value is not the same as importance (smaller value cases often have highly significant conflicts).

When first piloted, the Service received criticism on multiple levels, including the use of telephone and shortened session times. More recently, a mediation expert (after observing one of these mediations) noted that the process “clearly works”:

• “The 25 minute demonstration displayed the full repertoire of mediator moves, delivered with skill, speed and pleasantness”;
• “It was like watching a stripped-down, slicked-up commercial mediation without the posh accents”; and
• “The fact that so many cases settle in the time allotted should be a serious challenge to the rest of us [mediators].”

From the perspective of consumer satisfaction, the process appears to be highly successful. A 2012 study, for example, finds:

• 94.4% of respondents said they would use the Service again (this fell to 85.9% for those whose cases did not settle during the mediation); and
• The participation by telephone actually helps in diffusing conflict: some consumers are glad they don’t have to face or speak with the other party.

Replicating?

There are no particular difficulties in setting up and operating this type of scheme.

Reasons for replicating it include increased party satisfaction from providing:

• a process that is significantly quicker and less expensive than the going-to-court alternative;
• control of outcomes to the parties;
• flexibility and convenience for parties by using the telephone and keeping sessions to within an hour; and
• a strong incentive (i.e., the threat of continued litigation) toward achieving results.

Conclusion

Despite some history to the contrary, small claims mediation efforts can be successful.

The Small Claims Mediation Service in England and Wales demonstrates how that can happen.

Footnote 1: Information in this article is from “Models of Alternative Dispute Resolution (ADR), A report for the Legal Ombudsman, 31 October 2014,” at 48-51. Its authors are Chris Gill, Jane Williams, Carol Brennan and Carolyn Hirst, all of whom are associated with the Consumer Insight Centre at Queen Margaret University, Edinburgh, Scotland.

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