For pounds 25 per party, Andrew Hill said, an independent mediator offered to try to resolve the dispute which went back over four years of anger, mistrust and ill will.
Mr Hill, of Monier-Williams & Boxalls, a a firm of London solicitors, said: "Both sides were intransigent. We had paid about pounds 12,000 into court while the other side were asking for pounds 65,000.
"At the end of about three hours of the mediator to-ing and fro-ing between the two sides, we settled for pounds 25,000. It was very hard work and I emerged feeling like a piece of chewed string. But it cut the Gordian knot and saved untold hours of preparation for a trial, which would have cost each side at least pounds 5,000.
"At the and of the day, the clients weren't terribly happy but the solicitors were absolutely delighted because we knew the only people who were going to win if it went on to court were the lawyers."
The pilot scheme at the Central London County Court has been running for just over a year. Court staff send out details of the scheme to both parties in defended cases involving more than pounds 3,000, with no upper limit. If both sides agree, a mediation date can be fixed within a few weeks.
The initial impetus was to help an increasing number of litigants who were representing themselves. However, about two-thirds of the parties opting for mediation attend with their lawyers. Most of the mediations have involved breach of contract and supply of goods and services but there have also been some involving housing repairs, debts and personal injury.
The scheme received a considerable boost recently when the Legal Aid Board agreed to meet the costs of solicitors attending mediation with clients who have a legal aid certificate, for a fixed fee of pounds 230 plus VAT.
Judge Neil Butter QC, who is overseeing the scheme, sees the move as a breakthrough.
"Solicitors who were previously unwilling for their legally aided clients to take part in the mediation process will now be able to attend, knowing that their costs will be catered for, even if a settlement is not reached," he said.
However, more than 60 per cent of mediations end in agreement, which usually includes payment of costs.
The mediations take place in conference rooms in the court building between 4.30pm and 7.30pm on weekdays. If the two sides come to an agreement, a consent order can be made that day. If the dispute cannot be resolved it can go on to trial in the normal way and issues discussed during the mediation cannot be used.
Judge Butter said take-up had been low, however. Over the past year there had been just over 100 mediations, most involving sums of about pounds 10,000.
"I think there is a real feeling these days that if expensive and time consuming litigation can be avoided then so much the better," he said. "Mediation has the advantage of being quick, cheap, informal and, more often than not, leads to an amicable settlement.
"The problem is mediation is still new and not fully understood by litigants or their solicitors. However, in fairness, most cases settle before trial, although usually at a much later stage. Also. while thousands of cases are started, defences are only filed in a moderate proportion which then triggers the mediation mechanism."
The project's outcome could have important implications for the development of further mediation schemes and it is being evaluated for the Lord Chancellor's Department by Professor Hazel Genn, professor of socio-legal studies at University College London.
"The take-up has been lower than people had hoped, largely because the legal profession is either suspicious or apprehensive about mediation," she said. "Since the offers of mediation go to the parties' solicitors, we depend on them to discuss it with their clients."
Interviews with solicitors who rejected the mediation offer were revealing. One said, "I've only had it offered to me once and I turned it down on the basis that we are a firm of solicitors and we don't really need an independent mediation service. If we can't sort things out ourselves we go before the judge."
Professor Genn said: "People sometimes say lawyers won't recommend mediation because it hits them in their pockets. There may be a little of that but it is an oversimplified explanation. They are trained litigators yet mediation requires them to act more as advisers than advocates.
"But solicitors can be very useful in counselling and drafting agreements on the spot so there is a definite role for them."
Though mediation was not appropriate in all cases, where it worked the parties liked it. They liked the process itself which was less stressful, time consuming and costly and the way it could lead to more interesting compromises and creative settlements than a court could achieve.
"But there is an assumption that everybody is dying to settle. There are many people, however, who want vindication, who want an acknowledgement in a public court that a wrong was done to them rather than have it dealt with as a private compromise."
Claire Jackson, a commercial litigator with Vaudreys in Manchester, had one case where a client was being sued by a litigant in person who appeared determined to have his day in court, no matter what the cost.
"The case involved alleged breaches of contract on both sides," she said. "We made some without-prejudice offers which he rejected out of hand. However, he finally agreed to mediation. The resolution reached was nothing we hadn't already offered. But it gave him the chance to get his grievance off his chest.
"The benefit for my client was we did not have go through all the hoops you need to if the matter had proceeded to trial. The costs could have run into thousands of pounds. I would have no hesitation in recommending the project."
Judge Butter hopes the project, which has been extended until May 1998, will become permanent. "The striking feature of the whole process is the high level of consumer satisfaction - many mediations end with the parties shaking hands and leaving the building together," he said. "You do not often see that in a court of law."
The Mediation Service is at Central London County Court, 13-14 Park Crescent, London WI. Tel 0171 917 5053.Reuse content