The economic benefits of mediation for a law firm  - Trust Mediation

The economic benefits of mediation for a law firm 

Mediation has become increasingly popular, and almost ‘business as usual’ with clinical negligence claims due to its ability to produce cost-effective and efficient dispute resolution. Although Trust Mediation and its mediators are independent and neutral between claimant and defendant, this article looks at the economics of mediation from the perspective of the claimant law firm and why adopting mediation for suitable clinical negligence and personal injury cases can yield substantial economic benefits.   

As the legal landscape evolves, embracing mediation as a regular means of dispute resolution could significantly contribute to the success and profitability of claimant law firms. It is recognised, of course, that the interests of the claimant are paramount and central to all decisions made on the case. That said, the following economic benefits are worth considering. 

Unlocking Work in Progress (WIP): 

Mediation offers claimant law firms a unique advantage in terms of unlocking Work in Progress (WIP) and accelerating cash flow. In traditional litigation, cases can remain in progress for extended periods, tying up valuable resources and restricting the availability of working capital. However, by embracing mediation as a routine method of dispute resolution, law firms can speed up case resolutions, convert WIP into cash and recover disbursement outlay more swiftly.  Promptly settling cases and converting WIP into revenue allows law firms to maintain financial stability and allocate resources strategically. 

The accelerated resolution of cases through mediation also reduces the risk of any potential financial loss from an uncertain outcome in court. Not all cases will succeed, and if a case is running under a CFA, the information received at the mediation can influence your risk assessment of whether to run the case to trial if the case doesn’t settle. 

By transforming WIP into cash through the mediation process, law firms can not only improve their cash flow, but they can also invest in growth initiatives and optimise their financial position. The efficient resolution of existing cases means that claimant law firms can devote more attention to pursuing and acquiring new clients, thereby fostering growth, and establishing a strong market presence. 

Increased Efficiency: 

Mediation is known for its efficiency in resolving personal injury and clinical negligence disputes, with over half of mediations now taking place before court proceedings are issued.  Unlike court trials, which can take months or even years to reach a conclusion, mediations can be scheduled within weeks, allowing parties to negotiate and reach a settlement within a shorter timeframe. 80% of our mediations settle on the day or very shortly after. This settlement rate is the same whether the mediation takes place pre-proceedings or near to trial. 

Mediators encourage parties to engage in collaborative negotiations and reach settlements that are mutually acceptable. As a result, the time spent on a case can be significantly reduced, enabling law firms to conclude matters efficiently.   The expeditious resolution of cases through mediation enables claimant law firms to satisfy clients’ objectives as well as facilitating taking on new cases, leading to higher turnover rates and increased revenue generation.   

Mediation can also improve efficiency when negotiations have stalled. If one or both sides have made their final offers and there is no prospect of settlement, mediation could be the best way to bring the claim to conclusion. This is ultimately better for the firm’s costs recovery, risk management and cash flow position. 

With the Fixed Costs regime changing in October, mediation will also be a valuable tool to help achieve early settlement which is crucial in a fixed-fee regime. Mediation can significantly reduce the costs associated with traditional litigation and moreover, mediation sessions generally require less preparation time than going to court.  By minimising costs and accelerating case resolution, mediation allows law firms to allocate resources more efficiently. 

Agreeing costs at the mediation: 

Legal costs can be agreed at mediation. Mediation is a bespoke resolution, and whilst reaching agreement on legal costs as well as quantum isn’t yet the norm, there is nothing to stop parties from agreeing costs at the mediation. Provided claimants supply a detailed breakdown of legal costs in advance of the mediation, matters can be resolved in their entirety to bring total finality for claimants. 

Enhanced Client Satisfaction: 

By offering an alternative to litigation, mediation provides a more client-centric approach to dispute resolution. Claimants often experience emotional distress and financial strain because of their injuries. Mediation allows for a more collaborative and empathetic process, fostering a greater sense of control and involvement for clients. The active participation in the resolution of their case and knowing that they are being listened to are reasons claimants frequently give for their positive experience of mediation. 

These positive experiences and successful outcomes achieved through mediation can lead to repeat business for injury law firms. Clients who have undergone mediation and achieved favourable settlements will be more inclined to return to the firm for their future legal needs. Additionally, satisfied clients are more likely to recommend the law firm to friends, family, and colleagues who may require legal representation. 


Mediation not only offers economic advantages in terms of reduced costs, increased efficiency, enhanced negotiation skills and improved client satisfaction, but by embracing mediation as a routine method of dispute resolution, law firms can accelerate case resolutions, convert WIP into revenue, and maintain financial stability.  

With these economic benefits, mediation becomes an essential tool for claimant law firms seeking to thrive in a competitive legal landscape while providing effective and client-centric services. 

Trust Mediation are proud of their track record of over 80% of their mediations settling. If you need support with a mediation and or would like to discuss he economic benefits of mediation in more detail, please get in touch.