The year-long Court of Appeal mediation pilot launched on 2 April 2012 has been endorsed in the recent case of Ghaith v Indesit [2012] EWCA Civ 642.

Under the pilot, unless a judge exceptionally directs otherwise, every personal injury, clinical negligence and contractual claim worth £100,000 or less, and in which permission to appeal has been granted, will automatically be recommended for mediation to CEDR. If the parties agree to mediate, a panel of accredited CAMS mediators will be nominated by CEDR. The selected mediator will bring the parties together to try to reach a settlement, and if this is achieved, the case will not go back to the Court of Appeal.

Mr Ghaith appealed against the dismissal of his £60,000 personal injury claim against his employers, Indesit. In giving permission to appeal, Toulson LJ recommended that the parties utilise mediation (as the case fell within the scope of the pilot). However, Indesit’s insurers rejected this on the grounds that costs already incurred exceeded the amount at stake.

The Court (Longmore, Ward and Patten LJJ) allowed the appeal and remitted the case back to the County Court for the assessment of damages. Longmore LJ firmly rejected Indesit’s excuse for rejecting mediation, commenting: “This is an inadequate response to the Court’s encouragement of mediation, since a full day in this Court will inevitably result in a substantial increase in costs.” Since the appeal in Ghaith was allowed, the question of costs sanctions for failure to mediate did not arise. However, given the degree of judicial encouragement, refusal to mediate by a successful party would likely  be clear evidence of unreasonableness, attracting cost sanctions.