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Litigation Tactics and Mediation - The Limits27th May 2020 Commercial Litigation
A recent decision of the SDT has made clearer the limits of tactical approaches to mediation.
In SRA v Deian Benjamin the SDT struck off a solicitor for being dishonest as to whether or not counsel had been instructed for a mediation. Mr Benjamin was instructed in a dispute. Litigation was being contemplated but the parties had agreed to mediation prior to the issue of proceedings. In response to an emailed question by the solicitors for the other side, Freeths, Mr Benjamin had asserted that counsel was instructed to attend the mediation. He had made a similar assertion in the mediation Position Statement. He also made a similar untrue statement to the mediator. At the mediation Mr Benjamin lied further by asserting that counsel had been instructed but was not available due to a “family emergency”. Counsel had in fact never been instructed and was actually away on holiday. Mr Benjamin apparently had decided that it was a useful “litigation tactic” to assert that counsel had been instructed as it would make the other side more likely to believe that threats future litigation were “real”.
Freeths eventually found out the truth and reported the matter to the SRA. The substance of their complaint was that they would not have attended the mediation if they had been aware that counsel was not instructed. Mr Benjamin appeared to suggest before the SDT that Freeths were making this up and that they would have attended anyway. While I have no view on this question it is a concern that many parties consider that a mediation cannot proceed without counsel being in attendance. It appears to have been a common view in this case on both sides that the attendance of counsel would make the mediation more substantial. I do not accept this. Ultimately a mediation is about parties making a deal. Counsel can help or hinder that process, largely based on the attitude that the individual counsel adopts to the proceedings. But ultimately a deal must come from the parties. It does seem that part of Freeths concern actually arose from the fact that Mr Benjamin’s client did not appear to be attending and was sending him with instructions. The apparent instruction of counsel appears to have made Freeths believe that there was a likelihood of settlement that they did not seem to believe was there if Mr Benjamin came himself. This though also seems misconceived. Counsel’s attendance or otherwise would not change the instructions that Mr Benjamin had. The only thing that it would demonstrate was that Mr Benjamin’s clients were spending more money on the mediation and so could be seen as taking it more seriously. However, if that was the issue then a true demonstration of seriousness would have been to attend the mediation. In addition, if money was being spent on counsel then that was money that was not available for settlement.
In short, the entire approach of the parties to the mediation seems backwards. The point of a mediation is to secure a deal to settle a dispute. Rather than working towards this both parties seem to have engaged in behaviour that made settlement far less likely. In particular, instead of raising key questions and concerns that potentially stood in the way of settlement the parties seem to have considered unconnected actions, such as instructing counsel, as proxies for an intention to settle. The only true indicator of intention to settle in settlement. At mediation all parties claim that they want to settle. Many do. Others do not but come to realise that settling is the best option. But if there is a reasonable point which is crucial to a party attending and believing in the other side’s willingness to settle then this is best raised and ventilated fully before the mediation. If necessary by way of a conference call with the mediator involved as a pre-mediation issue.
On a more positive note, this decision further amplifies the importance of mediation in the overall dispute resolution process. It is very unlikely that any solicitor would have been dishonest about whether or not counsel had been instructed for a court hearing, they certainly would not have misled the court over the question. Mediation is deserving of the same respect and the SDT has acted to underscore that.