Courts and Tribunals Tasmania

Mediation and Conciliation Conferences

Circular to Practitioners
Who Must Attend
Preparation for the Conference
Confidentiality
Procedure at the Conference
Offers of Settlement
Costs of the Conference
Cost Penalties
Cost Penalties Example 1 & Example 2
Enquiries

Conciliation conferences are integral to case management in the Magistrates' Court (Civil Division) and provide the primary opportunity to resolve the dispute by negotiating a mutually agreeable resolution or compromise.

WHO MUST ATTEND

The parties must attend in person unless other arrangements are approved by the Registrar. If a party's attendance is likely to cause undue expense or inconvenience, or the party is in ill health, a telephone link may be approved by the Registrar.

If a party is a company or an unincorporated association, or if the party is represented by an insurer, a person with full authority to settle the claim must attend the conference.

The parties' solicitors should also attend unless prior arrangements have been made with the Registrar.

PREPARATION FOR THE CONFERENCE

At the conference the parties should be in a position to explore settlement. The information necessary to explore the issues in dispute and up-to-date particulars should be exchanged prior to the conference.

The parties' solicitors should forward to the Registrar, at least three days before the conference, any material to assist the conciliator understand the issues in dispute that that party has forwarded to the other party, eg particulars of injury or damage, medical reports.

CONFIDENTIALITY

The conference is without prejudice and confidential subject to the Alternative Dispute Resolution Act 2001, matters discussed at the conference, or admissions made, cannot be used outside the conference.

During the conciliation conference, the conciliator may hold a private conference with each of the parties. The matters discussed during this part of the conference will not be disclosed to the other side. The conciliator does not discuss the matters raised at the conference with a Magistrate.

Only directions given at the conference are noted on the Court record. Offers of settlement are not communicated to the Magistrate until after judgment has been given. Notes made by the conciliator are kept in a sealed envelope on the Court file.

PROCEDURE AT THE CONFERENCE

Role of the Conciliator

The conciliator is an impartial facilitator who will assist the parties to define the issues in dispute, ensure the issues are explored and ensure each party has an opportunity to be heard. The conciliator will not give legal advice or advise on settlement.

Role of Solicitor/Client

It is a matter between the solicitor and the client whether the client plays an active role in the conciliation conference. In some conferences the parties may agree that the solicitors leave the conference to resolve issues between the parties. The solicitor should, however, be available to return to the conference to advise on any agreement reached and prepare consent judgments etc.

Outline of Stages of the Conference

  • each party will outline their claim or defence;
  • the conciliator, with the parties, will define the issues in dispute;
  • the conciliator may have a private discussion with each of the parties separately;
  • options for settlement will be explored;
  • offers to settle the claim will be made; and
  • if settlement is achieved, the agreement will be documented.

OFFERS OF SETTLEMENT

At the conference each party will be required to make an offer to settle the dispute. These offers will be recorded and if no offer is made the offer will be recorded as nil. These offers will not be communicated to the Magistrate until after final judgment has been entered. The Magistrate may take these offers into account in making costs orders.

COSTS OF THE CONFERENCE

In Minor Civil Claims there is no charge for the court's facilities or for the conciliator's time for the conference.

In civil claims, the Magistrate generally orders pursuant to the Alternative Dispute Resolution Act 2001 that the cost of the mediation (currently $300 plus GST) is to be borne by the parties in equal shares, or such other proportions as the Magistrate considers appropriate. The Claimant is usually ordered to pay the full cost to the Court in the first instance, and is entitled to recover the relevant proportion from the other party or parties.

The costs of solicitors attending at mediation are "costs in the cause", which means that whoever is unsuccessful will usually pay the costs of both parties' solicitors for the time at the conference.

COST PENALTY RULES  

It is important to understand the consequences of making an inadequate offer if you are a defendant, or making an offer substantially higher than that ultimately awarded by the Magistrate if you are a claimant.

The costs penalty provisions in the Magistrates Court (Civil Division) Rules 1998 r.141-143 are intended to encourage the parties to keep the quantum of claims within realistic bounds, and discourage ambit claims. The Rules are intended to encourage the parties and their advisers to make realistic assessments of their prospects of success by the conciliation conference so that the Claimant reduces his or her claim to a realistic figure and the Defendant makes a realistic offer.

The Rules contain the following cost penalties:

  • Rule 141(2) : if a Claimant obtains final judgement for an amount equal to or less than the amount of the Defendants offer, the Claimant is only entitled to party-party costs for a period up to 14 days after the date of service of the offer. Thereafter the Defendant is entitled to party-party costs.
  • Rules 142 and 143 contain two formulae which impose further costs penalties on either of the parties in the event that the Claimant obtains final judgment of either less than half, or more than double, the amount offered by the Defendant. Once either formula applies, the greater the margin between the offer and the amount awarded, the greater the effect on the costs entitlement.

These rules are best demonstrated by the following examples:

Example 1 (Rule 142 Cost Penalty for Inadequate Offer)

The Claimant commences a claim for $15,000. The Defendant files an offer of $2,000 at the conciliation conference. Judgement after trial awards the Claimant $10,000. The Claimants party-party costs are assessed at $3,000.

The Claimant is entitled to an order for costs on the judgement as it exceeds the Defendants filed offer, and is entitled to a bonus up to his full solicitor-client costs because the judgement is more than 200% of the filed offer.

The formula is:

C = 2 x P X (J-A)

J

where

C    is the costs to which the party is entitled;

P    is the costs of the party, as agreed or assessed;

J    is the amount awarded by the judgement, exclusive of costs and interest;

A    is the amount contained in the offer or the payment into Court.

Applying the formula in Example 1 above, the Claimant would be entitled to:

C= 2 x 3,000 x (10,000 2,000)

10,000

which amounts to $4,800, as compared with assessed party-party costs of $3,000.

Example 2 (Rule 143 Cost Penalty for Excessive Claim)

The Claimant commences a claim for $15,000. At the conciliation conference, the Claimant files an offer of $10,000; and the Defendant files an offer for $3,000.

Judgement after trial awards the Claimant $4,000. The Claimants party-party costs are assessed at $3,000.

The Claimant is entitled to an order for costs on the judgement as it exceeds the Defendants filed offer, but because the Judgement is less than 50% of the amount claimed, the penalty rules apply to reduce the Claimants costs entitlement.

The formula is:

C= 2 x P x J

A

Where

C    is the costs to which the party is entitled;

P    is the costs of the party, as agreed or assessed;

J    is the amount awarded by the judgement, exclusive of costs and interest;

A    is the amount contained in the offer or the payment into Court.

Applying the formula in Example 2 above, the Claimant would be entitled to:

C = 2 x 3,000 x 4,000

10,000

which amounts to $2,400 as compared with assessed party-party costs of $3,000.