‘Litigation costs exceed value of the claim’

In Teasdale v Carter [2023] EWHC 490 Fam, the High Court dismissed the claimant’s proprietary estoppel claim against her husband and daughter over the ownership of a farm outbuilding. Moor J stated: ‘I have to say that this is one of the most regrettable pieces of litigation that I have ever come across. It is not just because this family has become so fractured as a result. The total costs of the litigation at the conclusion of the hearing below were approximately £828,000. The costs of this appeal are £220,000. These figures do not include the costs of the financial remedy proceedings. The house at the heart of the dispute, Cow House, is worth £245,000, after a 20% reduction for an agricultural occupation restriction. When the appeal was opened, it was said that, if I allowed the appeal, the matter would have to be re-heard at further vast expense, as an appeal court clearly could not substitute different findings of fact for those found by the judge below. The final reason that the position is so regrettable is that the parties agreed a way forward on 7 October 2020 which would have obviated the need for all this litigation. Unfortunately, the agreement was subsequently repudiated by the Appellant, on the basis that the First Respondent had enlarged her claim in other respects. The case was then litigated for nine days before HHJ Shelton. It has been heard for two days before me, although that time estimate included only half a day of reading time and absolutely no judgment writing time.’
At the conclusion of a Mediation, it is critical to execute a legally binding settlement agreement that is comprehensive, i.e. which clearly and coherently states all of the material terms of the deal that has been agreed.
As I explain in paragraph 22.13 of my book the ‘Contentious Probate Handbook’ (published by the Law Society in July 2020),
‘[It] is not the normal practice of the Judges or Masters of the Chancery Division to inspect schedules or agreements annexed to Tomlin Orders. The judge who makes the order undertakes no responsibility for the scheduled terms and cannot be taken to have approved them. In other words once a contract has been agreed the parties will be bound by it’s terms. Therefore, until all material terms of settlement have been agreed, and expressed in terms that are capable of legal implementation, it would not be prudent to sign a binding agreement, whether in the form of heads of agreement, or a detailed schedule of terms.’
Consequently, in a one-day Mediation of a Contentious Probate dispute, the drafting of a comprehensive, coherent and legally binding settlement agreement, not infrequently consumes around 30% of the Mediation Day, i.e. between 5.30pm-10pm – which is the time when the participants are most vulnerable to the making of mistakes that subsequently can result in ‘buyer’s remorse’ – because they are exhausted.