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Social Housing Speed Read – Free mediation pilot

On 1 February 2021, the HM Courts and Tribunal Service commenced a free mediation pilot for possession claims.

The pilot is intended to last for six months and was introduced with the aim of easing the pressure on the courts caused by the backing up of possession claims during the pandemic. The pilot is to be funded by the Government and will be free to participants. To be eligible for mediation, both parties must agree to it and an agreement must not have been reached between the parties by the Possession Review Hearing.

Through mediation, the parties will be helped by an independent third party to try and reach a negotiated settlement without the need for the claim to progress through the Court system to trial.

On the face of things, this sounds positive and geared towards saving both time and money – but many, including the Law Society, have expressed their doubts about how effective mediation will be in housing cases.

The President of the Law Society, David Greene, has said that ‘housing is such an essential life requirement that mediation cannot replace the usual routes of access to justice through the courts’. He is also one of many concerned that mediation may push tenants into settling claims without understanding their rights in order to avoid trial, rather than direct them to specialist legal advice.

From a landlord’s perspective, possession proceedings should be a last resort and social housing providers will have considered the proportionality of their decision to seek possession (and the failure / inefficiency of other options) before issuing a claim. Therefore, by the time a possession claim is brought, the likelihood that rent arrears, anti-social behaviour or other tenancy breach will have existed for some considerable time and landlords will have waited out the (ever longer) notice periods of a section 8 or section 21 notice without improvement in the situation.  Many are also sceptical as to how many tenants will actually engage in mediation and whether it will reduce the Court’s backlog significantly. Our view is that there must also be questions as to the efficacy / binding nature of any agreement reached through mediation and how any breaches would be looked upon by a Judge.

However, the pilot has been introduced to sustain tenancies; aiming to avoid concluding possession proceedings with an eviction which is in keeping with the government’s objective of keeping people safe during the pandemic. Whilst no-one would criticise that objective, the reality is that – for social housing providers – possession proceedings are a legitimate and effective housing management tool to deal with breaches of tenancy; and sometimes it is the only choice. For many, following the mediation pilot will simply increase the delay between the start of possession proceedings and a final hearing, which will also increase cost.

Coupled to that is the concern amongst some landlords that they will effectively be obliged to take part in the mediation process – even if it is very unlikely to be successful – as they feel Judges may look unfavourably on those who do not.

In principle, the pilot may well be a new option for social housing providers who believe that a compromise can be reached in possession proceedings – as opposed to waiting several months before the tenant might be willing to discuss either an adjournment or possession order suspended on terms. If a settlement could be agreed, tt would assist both sides in avoiding costly Court hearings, legal fees and (in rent cases) the further accumulation of rent arrears whilst possession proceedings are ongoing.

The practical effect of this pilot scheme is yet to be seen and, only a month in, it has already garnered negative press from both landlord and tenant representatives. In reality, the circumstances are such that it is unlikely at the end of the six month trial we will have an accurate view of how effective this scheme is and how it could work better in future. It is however important that social housing providers now consider alternative dispute resolution when bringing possession proceedings and are alive to the option of resolving the disputes by compromise. In many cases, the risk of refusing mediation (and the potential for costs orders being made against a party that unreasonably does so) will outweigh the inevitable time and delay that it will add.

If you have any questions on the above and how it will affect social housing providers, or any other questions as a social housing provider, please do not hesitate to contact John Murray or a member of our expert Social Housing Team.

Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.

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