Mediation and alternative dispute resolutionWhy compromise? Increasingly in civil litigation there are no winners — not even the lawyers, following the review and implementation of Sir Rupert Jackson’s report into costs. The question is rapidly being re-phrased as “Why litigate?”
Prior to 1 April, lawyers were able to work on a “no win, no fee” basis and recover a percentage uplift and after the event (ATE) insurance premium on top of their fees if the claim was successful. Now not only have the playing field and goal posts changed, but the game itself has, following the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO). Now the resources available for justice are limited, and the needs of the litigant have to be balanced against the resources available. This is recognised in the new overriding objective of the Civil Procedure Rules .
To start with, the funding options for claimants have changed. Now, lawyers cannot recover their success fee or ATE insurance premium from the defendant, but must instead look at other funding options, such as Damages Based Agreements (payment from damages) or Conditional Fee Agreements (where the success fee is taken out of damages, up to a limit). This results in claimant lawyers taking more risk. On the other hand, the changes also affect defendants, such as the 10% increase in general damages, the changes to CPR Part 36 regarding offers to settle, and Qualified One Way Costs Shifting in certain cases (whereby claimants can bring claims without the risk of having to pay the defendants’ costs if they lose). Parties in multi-track cases have to prepare a budget for the Court, estimating what the costs are likely to be in a particular case and the Court then approves a limit. Legal aid is being cut back as well, particularly in family cases, and the Ministry of Justice is under to pressure to cut its budget and to make Court users pay for the Court service. There is a sense in which mediation is being made to fill the void. There is no longer any unfettered right to litigate and mediation is seen as a way of reducing the cases that come before the Court. The former Justice Minister, Jonathan Djanogly was quoted as saying, in the context of family law: