Why some disputes should never reach court - a judicial perspective.

 There was a rueful saying at the English Chancery Bar that there were two kinds of disputes which were un-settleable: children and boundaries. The reasons for that are fairly obvious. Feelings tend to run particularly high in those cases, and strong emotions behind a dispute distort judgment, entrench obstinacy and lead to the only course being a fight to the bitter end, although even then the court’s decision often just leads to subsequent guerrilla warfare, or, in the boundary situation, one party eventually moving house.

But there are more subtle reasons why these and other disputes should never reach court. They arise, broadly, in two types of case. The first is where the parties are inevitably going to have to have a continuing relationship with each other afterwards, whatever the outcome of the dispute. In such cases, litigation is very rarely the end of hostilities because it produces a forced situation usually hugely resented by at least one party, and changes the dynamics of the inevitable continuing relationship, rarely for the better. The second is where the remedies available from litigation are too much of a blunt instrument. They can only provide a money judgment or impose an order that the loser do, or do not do something, but always according to bald legal rights, and this can be so inefficient where probing under the surface reveals that there are more creative possibilities, which could actually provide acceptable benefits to both parties. Trust disputes, whether between beneficiaries themselves or between them (or factions of them) and their trustees, often fall in to both categories. This is, therefore, where mediation can come into its own.

Mediation is a process of “assisted negotiation”. The mediator acts as an intermediary between the parties in dispute, helping them to reach an ultimate agreement, which is stable, because they have agreed that it is an acceptable solution to their dispute. The mediator acts as a “clutch” between the grating positions of the antagonistic parties. His/her interposition enables unproductive emotions to be filtered out of the parties’ interaction, so that focus can be on the problem itself, rather than personal animosity. The parties are encouraged to examine their interests, rather than assert their positions. The mediator can tease out what each party really wants or needs, and explore options for achieving results which may have benefits for both parties, outside the constraints of what could be achieved by pursuing legal proceedings. By guiding the parties towards viewing the problem more objectively, and always bear in mind their “BATNA” (Best Alternative To a Negotiated Agreement) - the best achievable result under their sole control if they walk away, a mediator can guide the parties to a result which each can accept as having a basis of fairness and pragmatism, rather than “victory” or “defeat”.

Apart from the flexibility described above, there other significant advantages of mediation, as an alternative to litigation. First, the process is confidential; it is always on a “without prejudice” basis, unless the parties agree otherwise. None of the material disclosed in a mediation can be deployed against a party in any subsequent litigation, if the process fails. That encourages frankness and bona fide negotiation. (The exact rules about what the mediator may, or may not, disclose to the opposing party during the mediation are laid down in the mediation agreement.) Mediation is also a far cheaper and quicker process than court proceedings. Fewer people are involved and costly, labour-intensive, court processes are avoided. The parties themselves remain in control of the process because it is consensual; they can tailor it to fit their needs and wishes, although always, of course, as agreed with the mediator in the mediation agreement. And as mentioned above, the parties can also agree an outcome that a Court would never have the power to order.

It might, of course, be said that the disadvantage of mediation is that it is not binding unless and until there is an actual agreement. Mediations are typically conducted as a single quite lengthy session of “shuttle diplomacy” with such plenary sessions as the mediator feels are appropriate at any point, and it is not uncommon for the mediation session to end without any final agreement being concluded. However, that does not mean that the mediation has failed, because it is also remarkably common that, when the parties go away and reflect, the influence of what they have learned or realised during the mediation process, itself enables them to reach a final settlement on their own account, shortly afterwards.

From the judicial perspective, contentious trust cases certainly figure prominently among the kind of cases which, really, should never reach a court, as they are obvious candidates for the benefits of alternative dispute resolution, and in particular mediation.