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At Shergroup we keep tabs on those areas of civil justice which affect our enforcement process and now through our Newsletter we can share these updates with you and give you our opinion on how they will impact YOU as a member of our community.
So, this week UK’s Ministry of Justice has announced significant changes that will revolutionize the way small civil claims are handled in England and Wales.
From now on, all small claims valued at £10,000 and below will be subject to compulsory mediation as part of the litigation process. This groundbreaking initiative aims to free up vital court capacity, benefitting tens of thousands of people and businesses seeking resolution for their disputes.
Under these new reforms, anyone involved in small civil claims will now have access to free mediation services. Mediation offers a viable alternative to traditional court proceedings, enabling parties to resolve their disputes amicably and without the need for a formal hearing. This measure is expected to spare thousands of families from court and result in nearly 5,000 additional sitting days per year, effectively boosting court capacity and reducing waiting times for complex cases.
When parties initiate a small claim valued up to £10,000, they will be automatically referred to a free hour-long telephone session with a professional mediator, courtesy of HM Courts and Tribunals Service (HMCTS). This process ensures that before proceeding to a court hearing, parties have the opportunity to explore mediation as a means of resolving their differences.
The scope of these reforms encompasses a wide range of small civil claims, including cases such as homeowners suing their builders for failure to deliver promised services or businesses seeking to recover debts from customers. In fact, the reforms are projected to positively impact up to 92,000 cases annually, making a significant difference in the lives of those involved.
Mediation offers several benefits that extend beyond mere cost savings. By encouraging parties to resolve their disputes outside of court, these reforms reduce unnecessary stress and streamline the entire legal process. The introduction of mediation in the civil justice system signifies a positive shift towards simplifying procedures, ensuring that county court cases become less lengthy, stressful, and avoidable.
The Government’s commitment to simplifying civil cases does not end here. In addition to the compulsory mediation reforms, the Ministry of Justice has also taken steps to protect children from witnessing disputes in family courts. By mandating mediation for separating families, they have successfully distributed nearly 20,000 mediation vouchers, achieving a remarkable 69% success rate in reaching agreements without resorting to court.
This progressive reform has garnered widespread support from various stakeholders in the legal community. James South, Chief Executive of CEDR, has expressed strong support for automatic referral of civil disputes up to £10,000 to mediation, acknowledging how mediation can bring significant benefits to parties involved in small claims.
Mia Forbes Pirie, a Director of the Civil Mediation Council (CMC), believes that mediation is key to efficiently and cost-effectively resolving disputes of all sizes. She applauds the Ministry of Justice’s decision to automatically refer claims of up to £10,000 to mediation.
The Ministry of Justice’s efforts to improve dispute resolution extend beyond just small civil claims. Additional initiatives, such as signing the United Nations Convention on International Settlement Agreements, strengthening oversight of consumer dispute resolution opportunities, and enhancing the dispute resolution process for tenants, are in the pipeline.
The UK’s Ministry of Justice is taking proactive measures to modernize the civil justice system and provide more accessible, fair, and affordable dispute resolution options. The introduction of compulsory mediation for small claims valued at £10,000 and below marks a significant step forward in improving the legal landscape for all parties involved and we support it at Shergroup. It doesn’t dilute our ability to enforce a judgment under £10,000. If anything, it speeds up the process of getting to a decision and in the event of default being able to go back to Court to enter a judgment through the hearing process. By embracing mediation, we aim to see fewer cases in court, reduced waiting times, and a more efficient resolution of disputes.
As it was yesterday we had just this sort of case come through. Although a settlement was agreed at the hearing – which involved the return of goods to satisfy an outstanding claim, it didn’t move the case forward because when the goods were returned they were defective. The creditor rejected the goods and so we are now referring the case back to the Court for a final hearing. Ultimately if we achieve judgment in favour of our client, we will enforce the same through our High Court enforcement team and we already know that the debtor has assets that can be taken into legal control.
So, in short claimants are not stuck with mediation – which was always the fear – but it should speed up the legal process and we support that. In fact, we support any initiative by Government which gets claimants through the legal process with less delay, with the opportunity to achieve a payment, but if that doesn’t happen, then with access to an experienced High Court Enforcement Officer, such as our own Claire Sandbrook.
We hope that this update gives you a clear understanding of the recent developments in the UK’s civil justice system and highlights the benefits of embracing mediation for small claims. At Shergroup, we will continue to keep you informed about legal developments which touch members of our growing community and help you navigate the changing landscape of dispute resolution.
If you have any questions or require further information, please feel free to reach out to our expert team. We are here to support you with practical and sensible solutions to the tricky problems on your desk!
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Last updated | 19 July 2023
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