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Is the Mediation Agreement enforceable?
June 28, 2013
In the recent case of Frost v Wake Smith & Tofields Solicitors
[2013] EWCA Civ 772, the mediator was said to have “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”.
The Judge went on to say “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”. Thumbs up for mediation then! So after this minor miracle, how come the case was back in court? Essentially the Court of Appeal was considering an appeal from the county court judge’s decision that the solicitor was not negligent/in breach of duty in failing to ensure the first mediation ended in a binding agreement. The Court of Appeal confirmed the solicitor had not been negligent in failing to “render into a legally enforceable form the agreement to which the parties came”. If failure to warn the client the agreement was unenforceable had been pleaded, there may have been a different outcome.
What the case highlights is the importance of advisers being alive to their client’s expectations in advance of the mediation and then checking those expectations throughout the day and significantly at the end. In this particular case it seems that expectations that any agreement could be reached at all before the mediation may have been low. The fact that there was a framework of an agreement by the end seems to have been acheived against all the odds. It was not realisitc that this agreement would have been legally binding, it didn’t contain nearly enough detail. As an agreement in principle it was a starting point, the practicalities were yet to be worked out.
This case serves as a reminder though to advisers who attend mediations: warn your client about any limitations on the perceived enforcability of the mediation agreement. Perhaps build in to any framework agreement the next steps in working towards the goal of reaching an enforecable, legally binding agreement. It may be useful to agree realistic time frames by which further information can be exchanged or clarified. Check that in the closing moments of the mediation each party is clear about the status of what they have agreed and what needs to happen next to secure final resolution of the dispute.
