Can you settle costs at a mediation?

Can costs be settled at personal injury mediation?

Yes, they can.  One of the great strengths of the mediation process is that it enables the parties to reach agreement on everything on which they would otherwise have to seek a ruling if they are unable to agree.  These include liability, the amount of the claim, and legal costs.

Prepare to settle costs in advance of the mediation

It is important to tell the other side in advance that you hope to be able to agree costs during the mediation.  This will enable them to be ready for a discussion of the costs claim. The claimant will prepare the claim for costs in sufficient detail to enable the defendant’s solicitor to make a fair assessment of the schedule that is produced, and the defendant will have someone at the mediation who is competent to assess the reasonableness of the claim.

Very often a defendant’s insurers will be reluctant to agree the value of the claim unless they have a good idea of the amount of the claim for costs.  This is particularly true if the claimant is bringing the claim with the benefit of a conditional fee agreement.  I have known cases when the insurers have refused to settle the claim without also settling the claim for costs.  In this way they can reach finality, make a single payment, and close their file.  The other day this scene repeated itself, and I encouraged the costs experts on each side to go into a room together and thrash out an agreement on costs.  This proved to be successful, and the day was saved.

Avoiding claimant conflicts of interest

The claimant’s side is usually likely to insist on a two stage process.  In this way they will avoid any danger of any conflict of interest between the solicitor and his/her client from a costs inclusive offer.  In such cases the solicitor may indicate a willingness to try and agree costs at the mediation, but only after their client’s claim for compensation has been settled.  This happened at the mediation I have just mentioned.

It is unnecessary to prepare a bill of costs as if it was needed for a detailed assessment.  What is needed is a schedule of the kind that is used when a court is asked to make a summary assessment of costs at the end of a hearing.

The settlement of the costs bill – when this is possible – is one of the most attractive features of the mediation process.

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