Practical Law

Last time, I looked at recent developments in mediation, including in light of the new Civil Procedure Rules. This time, I’m looking at the mediation of neighbour disputes.

Neighbour disputes often have two common features: hostility and (if the dispute goes as far as trial) the potential for huge legal costs to be run up. However, in my experience there is another way: mediation.

If I was asked how to persuade one neighbour to suggest mediation to the other, I’d say the answer lies in explaining the potential financial and non-financial benefits of taking any neighbour dispute to mediation.

Potential financial benefits

There are a number of potential financial benefits to mediating.

Firstly, both parties can save legal costs. For example, the total costs thrown away in Faidi v Elliot Corporation amounted to £140,134. This was a dispute between neighbours about the timber flooring to one flat which was said to cause noise that would not be heard if there was underlay and a carpet installed instead. All three Lord Justices commended mediation in their judgments for this kind of dispute. However, neither side had even written to the other proposing mediation until shortly before the Court of Appeal hearing.

As to what those legal costs may amount to, Mummery LJ warned in Cameron v Boggiano, a protracted neighbour dispute about the ownership of a thin strip of land, that:

“…the only certainty in this kind of case is that the financial outlay is almost always more than the disputed property is worth.”

Secondly, there may be longer term financial benefits to settling a neighbour dispute. As Mummery LJ said in Cameron v Boggiano:

“The lawsuit could have unwanted long-term consequences that a sensible compromise might have avoided. One side ‘wins’ at trial, and/or on appeal, but, in the long run, both sides lose if, for instance, litigation blight has damaged the prospects of selling up and moving elsewhere.”

Potential non-financial benefits

There are also a number of potential non-financial benefits to mediating.

Firstly, mediation allows the parties to bring forward resolution of their dispute. Mediation can (subject to both parties knowing the scope of the dispute) take place at any time and therefore far sooner than a trial. However, it is crucial to get the timing of the mediation right.

Secondly, settlement at mediation allows the parties to agree solutions that the courts cannot offer. Indeed in Faidi v Elliott Corporation, Jackson LJ said a moderate degree of carpeting might have reduced noise penetrating into the neighbouring flat but still enabled enjoyment of the timber floor and this was:

“…precisely the sort of outcome which a skilled mediator could achieve, but which the court will not impose.”

In other words, on the facts, a happy solution was not necessarily an “all or nothing” solution. Mediation therefore gives the parties more control over the outcome.

Indeed, before attending a mediation each party must give thought to the range of settlement options open to them to end their dispute. If these options include something other than the payment of monies, which may well be the case in a neighbour dispute, particular thought must be given in advance to how any settlement agreement would be drafted, including what legal documents or steps would be necessary to make an agreement work. The advice of a conveyancing professional, for example, may be required.

It may be that, having explored possible outcomes before and at the mediation, a certain solution to the dispute is palatable to the parties. A striking feature of the boundary dispute in Durden v Aston was that the end result was (to quote Patten LJ):

“…after all the hostility, unpleasantness and cost generated by the proceedings… the boundary will remain more or less where it has been throughout the ownership of these respective parties.”

Thirdly, settlement brings finality to the dispute. The affect of a neighbour dispute on the lives of the individuals involved has been spelt out in three recent Court of Appeal decisions:

• Mummery LJ in Cameron v Boggiano said:
  

  “Suing and being sued by neighbours is a stressful and unpleasant experience.”

• Ward LJ in Oliver v Symons said this:
  

  “All disputes between neighbours arouse deep passions and entrenched positions are taken as the parties stand upon their rights seemingly blissfully unaware or unconcerned that that they are committing themselves to unremitting litigation which will leave them bruised by the experience and very much the poorer, win or lose. It depresses me that solicitors cannot at the very first interview persuade their clients to put their faith in the hands of an experienced mediator, a dispassionate third party, to guide them to a fair and sensible compromise of an unseemly battle which will otherwise blight their lives for months and months to come.”

• In Faidi v Elliott Corporation, Ward LJ went on to say:
  

  “Not all neighbours are from hell. They may simply occupy the land of bigotry. There may be no escape from hell but the boundaries of bigotry can with tact be changed by the cutting edge of reasonableness skilfully applied by a trained mediator. Give and take is often better than all or nothing.”

As for any feelings of animosity that may exist, parties should be reminded that the mediation process does not have a set format. Although it is beneficial to start with an open session where each party sets out what they hope to achieve at the mediation, mediation is a flexible process which – with the guidance of the mediator – can adapt to the personalities and issues involved.

It is worth mediating

In conclusion, it is hoped that the Court of Appeal’s words, together with the flexibility of the mediation process itself, will be sufficient to persuade neighbours to take their dispute to mediation.