Mediation

A court case can take months and even years to bring a dispute to an end. And the process can become very costly to both parties, adding to frustration and making relations even worse.

Mediation can be a swifter and less expensive way of sorting out issues. Private and confidential, it can bring to the table matters the parties may prefer to keep away from the courts.

Within an informal setting the parties can enter into a dialogue, exchanging views in a comfortable and less stressful environment.

If a dispute is destined for the courts then mediation can delay matters. Even then it can serve to clarify issues which may not have become apparent until later on in the court process.

Mediators are impartial and neutral. They are not present to sit in judgment and impose a solution or outcome on the parties.

Mediators will have undergone training and should be accredited by a recognised body. They may well be solicitors, barristers, surveyors or accountants and familiar with residential landlord and tenant issues. They should be covered by liability insurance.

Empathy, flexibility, patience and considerable listening skills are important abilities for a mediator to have. The ability to look below the surface of the facts and issues to detect and understand the parties’ needs and interests is also important.

Results for leaseholders

A satisfactory outcome can lead to a change in the way the landlord or managing agent behaves. Perhaps it will lead to an adjustment to their methods of working; or a presentation of service charge accounts in a different way; and with major works, earlier and more intensive involvement of leaseholders beyond what is required by the law.

Above all, mediation looks to the future in a positive frame of mind, rather than dwelling upon the past.

Results for landlords

Mediation can lead to solutions not permitted by court or tribunal proceedings.

A court order can be made for payment of rent, service charges or insurance. This can be enforced through various ways that can be time-consuming.

A decision of the First-tier Tribunal (Property Chamber) will determine certain facts such as whether service charges are payable based on, for example, their reasonableness. But if the amount outstanding is not paid, then county court proceedings may become necessary.

Proceedings for an injunction forbidding certain behaviour can be expensive and unpredictable and if the injunction is breached could entail further proceedings to secure the good behaviour of the leaseholder.

The Tribunal can decide whether service charges are payable and/or reasonable and whether a term of a lease has been broken. But the tribunal’s powers are not wide-ranging and lack the flexibility of mediation.

A satisfactory mediation outcome is designed to be a win-win situation. In the example of an injunction it could be recognition of what led to the behaviour and steps put in place to reduce the chances of it happening again. For example, a landlord may be given an apology and systems created to nip in the bud warning signs of future problems.

The idea of mediation is to reduce costs and professional representatives should only be engaged where really necessary.

Nevertheless, it may be wise to seek legal advice where specialist input is needed in advance of a session. An example is the interpretation of a particular clause in a lease; another might be: who is liable for the roof or windows in a building where the scope and costs of their repair is in issue?

Surveyors and structural engineers may also need to be consulted where the mediation will involve arguments over schedules of dilapidations and costings.

It may not be appropriate where there are issues of fraud or where a legal precedent needs to be set.

Mediation is a consensual process. A session will not take place unless and until both parties agree to it.

The mediator will open the session by explaining the procedure and ground rules which govern the etiquette and conduct of the parties.

The mediator will meet each party first and give them a chance to summarise the issues from their own perspective so that the mediator can fully understand their concerns.

The parties will then enter into a joint session. Each will be invited to present their views of the dispute, uninterrupted by the other: the mediator will summarise the issues and then encourage both sides to come up with possible, mutually acceptable, solutions.

The intention of the joint session is to have a structured discussion, ensuring each person listens to and understands the other’s viewpoint, and actively attempts to resolve the dispute.

Where agreement is reached, the mediator will help the parties to draw up an agreement to be signed by them.

The mediator will destroy any notes they have made at the conclusion of the session.

Where agreement is not possible, either or both parties are free to initiate or continue with Tribunal or court action but cannot call the mediator to give evidence.

Think carefully before you refuse an offer of mediation.

Court rules provide that, in considering costs, the court must have regard to the conduct of the parties and, in particular, the efforts made, if any, before and during the proceedings in order to try to resolve the dispute.

A successful party at court is therefore open to paying their own costs should they fail to agree to mediation without good reason.

We encourage you to take professional advice if you are minded to turn down an offer of mediation.