Out-Law News 2 min. read

Solicitor "not in breach of duties" by failing to facilitate binding mediation agreement


A solicitor cannot be held responsible if parties to mediation do not immediately reach a final binding agreement, the Court of Appeal has confirmed.

In his judgment, Lord Justice Tomlinson said that mediation was a "flexible and immensely valuable process of dispute resolution". He said that although immediate resolution may be possible in some circumstances, in others "flesh will need to be put upon the bones" of what the parties agree.

The judge said that the only ground on which the solicitor could arguably have been found to be negligent was if he had informed his client, David Frost, that immediate resolution to an ongoing dispute with his brother Ron was possible. He could not, however, find any evidence that the solicitor, Mr Selby, had done so, he said.

"It was a minor triumph just to have got Ron to the mediation," the judge said. "The suggestion that [the solicitor] should in advance of the mediation have spent Mr David Frost's time and money in immersing himself in this level of detail as to the brothers' interests would not have commended itself to Mr David Frost at the time. Mr David Frost and Mr Selby had no idea whether an agreement might prove possible, let alone what shape it might take."

"The situation was not one in which an initial meeting was likely to be sufficient to enable the parties to proceed directly to a concluded agreement. They would need an agreement in principle, followed by a process of working out the practical implications and the steps required to give effect to their broad intentions. Mr Selby was not negligent in adopting this approach. He could not practically have adopted any other," he said.

Mediation is a voluntary and confidential process using the services of a mediator, which is a neutral third party who will attempt to facilitate negotiation of an agreed settlement. This will only be reached if both parties to the dispute agree on the outcome.

In this case, David Frost had instructed his solicitor in relation to an acrimonious dispute with his brother, Ron, over their mutual business interests. The dispute was later mediated by a third party, and the brothers reached an agreement in principle at the end of the process. Although Ron Frost later disputed the terms of the settlement, a binding agreement was reached following a second mediation.

"The irony is that the mediator performed a small miracle in producing an agreement in principle which ultimately matured into a perfected agreement pursuant to which the brothers were able to disentangle their interests," said Lord Justice Tomlinson. "So this unhappy story ultimately bears testimony to the ability of a skilled mediator to resolve even the most apparently intractable dispute attended by the inevitable animosity of a fractured family relationship."

Mediation expert Andrew Paton of Pinsent Masons, the law firm behind Out-Law.com, welcomed the court's "commonsense approach" to the dispute.

"A solicitor does not have an obligation to obtain a certain result in respect of any retainer, but rather to use reasonable skill and care in discharging his professional duties," he said. "The court's decision is consistent with this duty. Obtaining a final, binding result at the end of the mediation process requires the agreement of both parties."

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