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Bourne v Poznyak: the risks of failing to mediate

This case, in which I appeared for the defendant, illustrates the costs risks of refusing to mediate. The claimant brought a claim seeking a declaration that he had a beneficial interest in a house in Skegness and a cafe in Ingoldmells. Both properties were owed by the defendant, a Ukrainian lady who had been granted asylum in the UK and who had been in a relationship with the claimant and had lived with him for some of the duration of the relationship. After hearing evidence over the course of two days, in a reserved judgment, HHJ Worster dismissed the claims. On the face of it, therefore, the defendant was entitled to her costs. However, she had refused to mediate, in the face of a specific direction from the District Judge that “At all stages the parties must consider settling this litigation by any means of ADR (including mediation); any party not engaging in any such means proposed by another must serve a witness statement giving reasons within 21 days of that proposal; such witness statement must not be shown  to the trial judge until questions of costs arise”. The defendant filed a statement stating that she considered the claim to be spurious and that the only basis she would be willing to attend mediation was if the claimant intended to offer her repayment of any of the monies allegedly withdrawn from her business. The Judge accepted the claimant’s contention that this was nevertheless a case which was susceptible to mediation, a different outcome on the facts was certainly possible and mediation had reasonable prospect of success and ordered the claimant to pay only 50% of the defendant’s costs.