The courts in England and Wales expect parties to consider settlement at all stages of proceedings and can penalise in costs any unreasonable refusal to mediate. A recent case[1] considered whether the defendants’ approach was “unreasonable”, and offers valuable insight as to when a refusal to mediate may be penalised[2].
The case concerned a property in Chelsea valued at £3.85m; the claim was brought by Andrew Grijns against his mother, Janice, and his three brothers. Andrew claimed, amongst other things, that he was entitled to a significant beneficial interest in the property, based on alleged assurances given to him by his parents.
Following a trial, Janice was found to be the sole legal and beneficial owner of the property. All Andrew’s claims failed, and he was found to have occupied the property as a trespasser between 1 August 2023 and 30 May 2025. He was ordered to pay damages for all of that period.
The defendants sought their costs on the indemnity basis. Andrew sought a 30% to 50% deduction from their costs and made the overall submission that there be “no order” as to costs, pointing to their alleged refusal to mediate and failure to engage with settlement offers he had made.
Andrew made four offers during the litigation, none of which was accepted, the lowest being 25% of the net proceeds of sale, worth c.£900,000. He argued that the defendants had unreasonably failed to engage in ADR[3] throughout the litigation, and relied on, among other things, a prior decision of the Court of Appeal[4], where the Court indicated that an unreasonable refusal to mediate might justify a departure from the usual costs order[5].
[1] Grijns v Grijns & Ors [2025] EWHC 2853 (Ch)
[2] Although, as noted below, the court found on the facts of the case that the defendants had not in fact refused to mediate.
[3] Alternative Dispute Resolution
[4] Halsey v Milton Keynes General NHS Trust [2004] 1WLR 3002
[5] The usual order is that costs follow the event, i.e., the loser has to pay the costs of the winner.
However, the court found that the defendants had not refused to mediate at all. In fact, it was the defendants themselves who first suggested mediation in August 2023. Andrew maintained he was not prepared to mediate if his brothers were involved. The court pointed out that this was completely unrealistic in circumstances where Andrew himself had joined his brothers as parties to the proceedings.
In February 2024, Andrew offered to mediate with all parties on the condition that his brothers only attended the part of the mediation which dealt with his claim in trespass. The court considered that Andrew was unreasonable for seeking to impose that condition.
The defendants had also previously sought disclosure from Andrew, which had not been provided, and indicated that any mediation should follow this disclosure. The court appears to have found this to be reasonable. However, following disclosure and the delayed exchange of witness statements, the parties ran out of time to mediate before the trial, which was listed only 12 days after the exchange of witness statements.
The court held that, even though the defendants had not refused to mediate, this was a case in which it would have been wholly reasonable for them to have done so. The judge emphasised that there are various situations where courts have determined it to be reasonable for a party not to mediate. These include where parties have faced what they properly consider to be an unfounded claim (as Andrew’s claim was) and where, as here, they wish to contest the claim, rather than buy the claimant off. In such cases, the courts have customarily been unwilling to characterise the conduct of the party who refuses mediation as unreasonable.
The court noted that: “There can be no quarrel with the idea that parties, in litigation, should make reasonable efforts to settle, nor, if faced with a sensible and reasonable offer of settlement, to engage with such offers. That, however, does not compel, or require, a litigant, confronted by an wholly unrealistic offer, to waste time and cost with dealing with such an offer. Such an obligation would simply be wasteful as to time and cost and, if enforced by way of a costs penalty, would run the real risk that parties would feel themselves, for fear of penalty, compelled to settle unfounded litigation, such as the present, upon unjust terms”.
Grijns v Grijns accordingly confirms that the duties of the parties to respond to offers to mediate, not to unreasonably refuse to mediate, and to consider ADR throughout the course of litigation, do not compel a party to settle unfounded litigation for fear of being penalised in costs. Indeed, the court went further, noting the following: “Given the merits and given the unrealistic nature of Andrew’s best offer, set against those merits, there was, in reality, no sensible basis for a negotiation”, and, “in the result, I have no doubt at all that the fact of Andrew’s beaten offers and the fact that, rightly, in my view, they were not seen as a sensible basis for the commencement of a negotiation should not impinge adversely upon the Defendants’ entitlement to their costs.”
This case emphasises the fact that context is key when assessing whether a failure to engage in mediation is reasonable. The court will usually look at: the parties’ conduct, the merits of the claim, the nature of settlement offers, and overall engagement in ADR. Where parties impose conditions that must be fulfilled before they will agree to mediate, such conditions should be reasonable, proportionate, and properly explained, so that the court is not left to consider a blanket refusal.
The Dispute Resolution team at Laytons ETL have extensive experience in handling and settling complex and seemingly intractable disputes and can offer advice as to the appropriateness of mediation and other settlement techniques.
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