The Court of Appeal has issued a stark warning to litigators who ignore mediation 'with impunity'.

Describing as 'horrific' the £185,000 in legal fees run up in a small building dispute where the claimant won £5,000 overall after a partially successful counterclaim, Lord Justice Ward said: 'The profession can no longer with impunity shrug aside reasonable requests to mediate.'


Considering an appeal against the lower court's costs order, he went on: 'The parties cannot ignore a proper request to mediate simply because it was made before the claim was issued. With court fees escalating it may be folly to do so.'


The defendants were found to have acted unreasonably in refusing mediation and only escaped a costs penalty because it happened before the first clear judicial warning against such action in the 2002 case of Dunnett v Railtrack [2002] 2 ALL ER 850.


'Defendants in a like position in the future can expect little sympathy if they blithely battle on regardless of the alternatives,' the judge said.


Lord Justice Rix also suggested that the defendants in this case may have decided that once they were committed to the litigation, 'they might as well put their case as high as it could possibly be put' - what he described as the 'kitchen sink' approach. They were awarded £14,000 in their counterclaim, having sought more than £100,000.


He said: 'Litigants should be aware, and should be made aware by the lawyers whom they consult, that there are considerable perils in adding to a good case other aspects or items of dubious merit.'