Small Claims Mediation — What Happens (UK)

• Pilot period: 22 May 2024 to 6 April 2027 (paragraph 2). It is a pilot, not permanent law — check the current Practice Direction before relying on it.
• Money only. The only remedy claimed must be, or purport to be, a specified sum of money (paragraph 6(a)). An unspecified-damages claim is outside the scheme even if it is a small claim.
• Road traffic accident and personal injury claims are excluded (paragraph 6(c)); road traffic accident claims are also excluded from the online civil money claims limb (paragraph 3(b)(ii)).
• Track first. Rule 26.9 makes the small claims track the normal track for claims worth not more than £10,000. Personal injury claims carry lower sub-limits, so a claim can be worth under £10,000 and still not be a small claim.

• The sum in dispute, broken down — principal, any interest claimed, the court fee already paid.
• Your opening figure and, separately, your walk-away figure. Write both down. Do not improvise a floor under time pressure in a one-hour call.
• Payment terms you can live with — a lump sum by a date, or instalments. A lower total paid quickly is often worth more than a higher total you have to enforce.
• Three facts you can evidence, not ten you can argue. The mediator is not judging the merits, so a long case theory is wasted airtime.
• Non-money terms — whether the settlement is confidential, and whether it is in full and final settlement of everything between you.
• Your numbers if it does not settle — the hearing fee, time off work, and the fact that most of your costs are not recoverable even if you win.

• The court must consider a sanction. For pilot claims PD 51ZE modifies rule 26.6 so that at the hearing the court considers whether any sanction is appropriate in all the circumstances, having regard to whether the parties attended mediation.
• Costs can follow. The modified rule 27.14 lets the court take account of a failure to attend mediation when deciding costs, and the modified rule 45.13 lets the court make such an order on its own initiative — nobody has to ask.
• The court can order ADR outright. Rule 3.1(2)(o) gives the court power to order the parties to engage in alternative dispute resolution. Rule 1.4(2)(e) makes ordering, encouraging and facilitating ADR part of active case management, and rule 1.1(2)(f) puts promoting or using ADR in the overriding objective.
• The Court of Appeal has confirmed that power. In James Churchill v Merthyr Tydfil County Borough Council [2023] EWCA Civ 1416 (judgment 29 November 2023) the court held that it can lawfully stay proceedings for, or order, parties to engage in a non-court dispute resolution process, provided the order does not impair the claimant’s right to a judicial determination and is proportionate to settling the dispute fairly, quickly and at reasonable cost. It also held that paragraphs 9 to 10 of Halsey v Milton Keynes General NHS Trust were not part of the essential reasoning of that decision and so did not bind lower courts.

• The hearing is informal. Rule 27.8 provides that it is informal, that the strict rules of evidence do not apply, and that the court need not take evidence on oath.
• You can ask for a paper decision. Rule 27.9 lets a party give written notice, at least 7 days before the hearing, asking for the claim to be decided in their absence on the documents filed.
• Not turning up has hard consequences. A claimant who neither attends nor gives that notice may have the claim struck out. If only the defendant is absent, the court may decide on the claimant’s evidence.
• A short window to put it right. Under rule 27.11 a party who did not attend and did not give notice may apply within 14 days of service of the judgment to set it aside, showing both a good reason for not attending and a reasonable prospect of success at a re-hearing.

• Scotland uses Simple Procedure in the Sheriff Court, which the Scottish Courts and Tribunals Service describes as a speedy, inexpensive and informal way to resolve disputes. Separate rules, forms and timetable; the small claims track does not exist there.
• Northern Ireland handles small claims in the County Court, where a small claim is one where the value claimed is not more than £5,000, processed initially through the Civil Processing Centre at Laganside Courts. The official guidance sets out no mandatory mediation step equivalent to PD 51ZE.
• Ireland, the US, Australia and Canada each have their own small-claims systems — and in the US it varies state by state. Nothing here applies to any of them.