Mediator – Contentious Probate, Inheritance Act, & Trust Disputes

I qualified as a Certified Mediator in July 2021, and completed my required number of mediation observations between August and September. I have applied to the Society of Mediators for full accreditation and panel membership, and am attending the Zoom Mediations (i.e. controls) course they provide, in January 2022. I am planning to be available from February 2022 to conduct pre-mediation meetings, and mediations by Zoom.

To request a copy of my Mediation Agreement and to arrange a free preliminary consultation Zoom call, please either call my Clerk on 0207 936 3030 or send an email to carl@ihtbar.com.

As a practising Barrister and Author, I specialise in Contentious Probate, Inheritance Act, and Trust Disputes, and as a Certified Mediator, can be appointed to act as either a solo or co-mediator in a Zoom mediation about a dispute anywhere in the world, including the following trust law jurisdictions: Australia; Bahamas; Bermuda; BVI; Canada; Cayman;  China (http://www.china.org.cn/china/LegislationsForm2001-2010/2011-02/12/content_21907980.htm); Dubai; Guernsey; Gibraltar; India; Jersey; Malaysia; New Zealand; Northern Ireland; Pakistan; Republic of Cyprus; San Marino (The Court for Trusts and Fiduciary Relations – Corte Trust) (i.e. for trusts holding art, cultural heritage, and luxury assets located in Italy); and the United States.

As a newly qualified and Certified Mediator, I charge a fixed fee (the ‘basic fee’) for a mediation starting at 9.30am and ending at 5.30pm (GMT), and for time incurred after 5.30pm at my fully inclusive hourly rate of £300 (‘additional time’). The basic fee allows for 8 hours pre-reading time (i.e. position papers and one lever arch file of documents), and a pre-mediation meeting with each participant. There is no refund if a mediation ends for any reason before 5.30pm (GMT). The basic fee is payable in advance, and the mediation will only proceed if all participants and any observers have signed my standard Zoom Mediation Agreement. If the basic fee is payable by representatives of the estate, they are also contractually obliged to pay for any additional time incurred after 5.30pm (GMT). If a participant’s internet connection fails for any reason they agree to carry on by telephone, and bear all corresponding telephone charges.

For appointment as a Co-Mediator I will charge one half of the basic fee and at half of my hourly rate for additional time, so the total fees payable by the participants for either solo or co-mediation are the same.

As a Mediator my role is to manage a process that enables the parties to come out of their trenches and in a safe environment to walk side by side in jointly exploring and developing a commercial solution of their own design which takes into account: the facts presented in their position statements and agreed bundle; legal merits; litigation risks (including the judge); the time value of money; and the benefits of ‘doing a deal’ now instead of incurring further legal costs by resuming trench warfare.

The unifying factor in all contentious probate and trust cases is the composition of the estate/ trust asset pool, and its value. It is not uncommon for litigation costs to exceed the value of an estate, therefore participants are more likely to walk away from mediation with a slice of a larger cake (i.e. of the estate/trust fund) if they mediate before proceeding to litigation. Thus, the first item of business when I visit each participant in their camp (i.e. their Zoom break-out room), is to clarify and confirm the composition of the estate/trust asset pool, and values, which may have gone up or down since e.g. an IHT 400 was filed. Each participant should also apply for up to date Office Copies and valuations for any land in dispute in advance of the Mediation Day.

A Mediator must not only be impartial, but must also be seen to be impartial. The focus of a Mediator is therefore on the process and not on the outcome.

Mediation is a confidential process, and I cannot repeat anything said to me by a participant in their private Zoom break-out room to anybody outside that room unless authorized/told to do so.

The ‘without-prejudice’ rule applies to and protects all communications, see: Without prejudice | Practical Law (thomsonreuters.com)

At the end of the mediation the only document I will keep is the Mediation Agreement. All other documents provided to me and electronic files will be destroyed/deleted.

The golden rule in all mediations – which has always been and continues to be my advice to Clients when representing them as a Barrister in mediation, is that because mediation is essentially a form of facilitated negotiation, success (however that is measured by the participants), depends upon movement and momentum, which requires compromise on all sides, i.e. flexibility – otherwise if the parties stay in their trenches the mediation will fail. This requires courage, trust, and realism. My job as a Mediator is to empower the parties to begin and progress a difficult conversation. This requires counter-intuitive thinking and behaviour and can result in a paradigm shift which results in a creative solution that a court cannot impose. It therefore also requires a commercial rather than a forensic legal mind-set, and some imagination.

Prior to entering private practice I worked in-house for Rolls-Royce and Alstom (in Paris) structuring, drafting, and negotiating deals in multiple jurisdictions around the world. As a Mediation Advocate, I approach doing a deal in settlement of a dispute with the benefit of that commercial experience. Now as a Mediator, I can use my antennae to help parties re-frame their dispute as an opportunity. For example, where family wealth is held in a complex international ‘dynastic’ trust structure with underlying asset holding companies, and a dispute arises out of a critical event such as the death or loss of capacity of the wealth creator, if the overarching trust instrument was drafted using a standard form precedent that is no longer fit for purpose (i.e. because it was not carefully drafted as a bespoke document in the first place), or if the Deed has not been reviewed periodically, mediation of the dispute is an opportunity to re-draft the instrument on tax-efficient terms that a court could not direct. In other words, mediation is an opportunity to re-structure the trust as the end product of doing a ‘deal’ in settlement of the dispute, which may turn out to be a  win/win solution for both the beneficiaries and the trustees.

Prior to practising at the Bar I practised as both a commercial and private client solicitor drafting: shareholders agreements; IPR licence agreements; wills; and trusts, and am the author of ‘Tax-Efficient Wills Simplified’:

Tax-Efficient Wills Simplified eBook : Islam, Carl: Amazon.co.uk: Kindle Store.

I am therefore familiar with both the form and terms of most wills, trusts, and corporate governance documents, including LLP members’ agreements. In my practice as a Barrister I have also advised and written about fiduciary duties, see:

Breach of fiduciary duty claims and the quiet fiduciary thesis | Trusts & Trustees | Oxford Academic (oup.com)

Equitable compensation arising out of sale of a property ordered under section 14 TLATA | Trusts & Trustees | Oxford Academic (oup.com)

In the methodologies I have pioneered for mediation advocates, which are set out in my books the ‘Contentious Probate Handbook’ (published by the Law Society in 2016); and the ‘Contentious Trusts Handbook’ (published by the Law Society in 2020), I recommend that participants do not have an opening plenary session.

Instead, ground-rules and a broad and flexible structure (or direction of travel) are agreed during pre-mediation meetings individually with each participant. This is also an opportunity to test the link if the mediation is being conducted by Zoom.

The business of doing a deal can then get under way within the first hour. Participants therefore need to come to the table with the pragmatic resolve to do a deal, and be ready to make offers and counter-offers.

To discover and close the gap somebody has to get out of their trench and walk into the place in between. When the howitzers have stopped pounding and the smoke clears, each side can then see where a settlement zone exists, and gradually move forward in incremental steps toward closing the gap which divides them. This means they need to calculate their BATNA (best alternative to a negotiated settlement) i.e. what they are likely to end up with at the end of a trial.

Litigation is binary, and nobody ever recovers all of their costs. On the standard basis, as rule of thumb a party is unlikely to get more than two thirds of costs actually incurred, and in reality much less following a detailed assessment. If the losing party cannot pay the winner cannot recover, and this can result in bankruptcy for the losing party. That is why lawyers often liken contentious probate and trust litigation to a game of high stakes poker.

In these cases, ‘doing a deal’ is almost always better than going to court, and the Civil Justice Council have recently confirmed that the English court can order parties to litigation to mediate without the consent of all the parties. If a party refuses and wins, this is likely to turn out as a pyrrhic victory, because costs sanctions are likely to be applied for refusing to mediate.

Costs are the elephant in the room, and during the pre-mediation meetings I will ask each participant what costs they have incurred to date (including costs of the Mediation), and what their projection is if the case proceeds to trial, and ask for permission to inform the other participant, because at the end of the day, one of them will be ordered to pay a heavy price if the Mediation fails.

I will also check that the legal representatives have full authority to agree costs in the terms of a settlement agreement.

In contentious probate and trust cases it is not uncommon for costs at the end of a trial to exceed the value of the estate. Costs typically mount in tranches of around £10K for each stage in litigation, and pre-issue base costs and disbursements frequently exceed £25K. If there is a CFA, then part of the success fee can be taken into account as a debt in making an award for maintenance under the Inheritance Act, see: Inheritance Act – 25% CFA cases – Hirachand v Hirachand (CA)(2021) | Carl’s Wealth Planning Blog

See also: CFA Costs Allowed in second 1975 Act Claim | News and Events | Parklane Plowden Chambers

Re-H-in-the-CA-2021.pdf (radcliffechambers.com)

Adding costs incurred to the financial outcome a participant wants defines the outer limits of the potential zone of settlement, i.e. the gap between them at the outset.

As a Mediator I am always working with incomplete information and do not give any legal advice, although I may ask reality-testing questions about the basis and legal merits of a participant’s position and the corresponding real-world litigation risks if a deal is not done – i.e. by playing Devils advocate.

I will also probe for any element of double counting in the calculation of an offer, e.g. in the capitalisation of income needs in an Inheritance Act claim using Duxbury Tables, see:

Family Law Week: Capitalisation of income needs in Inheritance Act claims: Duxbury or Ogden?

It is the participants who will design, agree, and document their deal and not me They must and consequently will own it.

While my Mediation Agreement states that nothing is agreed until a settlement agreement has been executed, it is up to the participants to decide whether and how to document the terms of a settlement agreement, and usually one of the solicitors will have a worked up template/draft ready for mediation. It is not my job to advise any participant about whether they have agreed a good or bad deal, and how can a Mediator possibly know?

However, where for any reason a claimant’s solicitor proposes or requires that a payment be made either to their firm to hold for the benefit of trustees, or directly to trustees (i.e. instead of to their firm to hold for the benefit of their client after subtracting their fees), then that proposal or requirement should be clearly stated before a deal is agreed. Otherwise, it may not be possible for the participants legal representatives to draft and execute a settlement agreement on the day of the mediation where the Settlement Agreement incorporates complex trust provisions that need to be carfefully considered before they can be agreed.

Please note that as a Mediator I do not give any legal or tax advice whatsoever about the drafting and tax-efficiency of settlement agreements. While I take no part in drafting and recording terms of settlement, before ink is put to paper I will read the document, and if it does not appear to clearly state what has been agreed in principle, I will ask the participants to clarify whether or not the settlement agreement as drafted accords with their wishes and understanding. What they do next is up to them.

Likewise, I will only communicate an offer or counter-offer during the mediation if the participant has written it down and either emailed it to me or put it into the chat box for his break-out Zoom so that with his /her permission I can cut and paste it into the chat box for the other participant’s break-out room.

If participants are willing to walk down the road less travelled I am confident that a deal can be done, and the proportion of cases that settle on the day is around 74%, see:

Reviewing the 2018 Eighth CEDR Mediation Audit – by Joseph Mulrooney (mediatelegal.co.uk)

I suspect that in the majority of those cases, Mediation worked because the participants had invested in the process by preparing to do a deal instead of going to war, i.e. by thinking about: the settlement zone; the gap between what each participant wants; their BATNA’s; and how to close the gap and come away with a win-win solution compared to the costs and risks of litigation, which to an extent is always a lottery depending upon who the judge is.

Where parties and their legal and tax representatives are located in different time zones, while some parties will be participating late into the night, or early in the morning, a Zoom mediation may be particularly effective if the distance between participants has the advantage of avoiding face to face venting in a highly acrimonious dispute, as participants are not physically in the same room. In fact, they do not have to meet and can stay in their own Zoom break-out rooms throughout the mediation, which is not uncommon in domestic contentious probate and Inheritance Act mediations. In 2022 I am planning to write an article provisionally entitled, ‘Tools and Strategies for Mediating International Family Trust Disputes’,

I had the great privilege and honour of carrying out my mandatory mediation observations to qualify and obtain full accreditation as a mediator, with one of the top five Contentious Probate, Inheritance Act and Trust Mediators practising in England and Wales today – Mr Mark Keeley of Freeths.

What I learned is that there are in reality three types of offer a participant can make:

(i)   an ‘unacceptable’ offer that will be rejected and may result in the other participant walking out and ending the process;

(ii)  an ‘acceptable’ offer which is so high that the other participant will bite your hand off – which is why an offeror will not want to make such an offer; and

(iii) an ‘interesting offer’ that makes the other party really think, and start to work with that proposal, as a starting point for opening a discussion that results in a final settlement as the gap narrows.

Before a participant can make an ‘interesting offer’  there has to be reciprocal clarity about the elements of the claim and corresponding values – i.e. the mediation maths.

The challenge for a Mediator is to get each participant to identify (in strict confidence) what is actually at stake. The Mediator can then ask questions in order to get each participant to work out their range of best and worst outcome scenarios, which will identify the gap between their positions.

To help the parties to narrow and eventually close the gap, a Mediator can then ask reality testing questions which get each participant thinking about what a judge is likely to decide on the facts in the real world.

There is always an element of risk in civil litigation, and where the law is unsettled the outcome cannot be predicted with any high degree of certainty.  For example, in certain Inheritance Act claims, if the relief sought was argued before ten different judges, it is possible that each could make a different order.

In the Courts of England and Wales, as a general rule, judges at all levels are also required to assess costs summarily at the end of a trial on the fast track or at the conclusion of any other hearing lasting less than one day, i.e. on the spot at the end of the trial/hearing, see: See, ‘Guide to Summary Assessment of Costs’: Guide to Summary Assessment of Costs 2005 edition (publishing.service.gov.uk), therefore the earlier participants enter into mediation (which the court has the power to order without consent at the first CMC), the less risk there is of incurring a costs liability early on in the proceedings that could have been avoided altogether had the participants had the sense to go to mediation sooner rather than later.

From the outset, my compass as a Mediator is to help the parties to appreciate and think hard about: (i) the litigation risks and costs involved in proceeding to trial, and (ii) the mutual benefits of settling by doing a deal on terms that no judge has the power to order (i.e. a creative and practical solution).

In my experience, nearly all contentious probate and trust disputes eventually settle. The wonder is, why the participants did not mediate earlier instead of after significant costs had been incurred and the Frankenstein creature they  created, i.e. their claim, had taken on a life of its own.

See also my blogs:

Financial provision claim by adult child – Miles v. Shearer [2021] | Carl’s Wealth Planning Blog

Mediation in the Court of Protection | Carl’s Wealth Planning Blog

Mediation Strategies | Carl’s Wealth Planning Blog

Mediation of Will, Inheritance, Probate, and Trust disputes | Carl’s Wealth Planning Blog

Zoom Mediation of International Trust Disputes | Carl’s Wealth Planning Blog

and my articles:

The Advocate and the Expert in a Testamentary Capacity Claim | Expert Witness Journal

The Advocate and the Expert in the Court of Protection | Expert Witness Journal

Please note that my Mediation Agreement provides that Mediation continues until a settlement agreement has been executed by the participants, and that if a settlement agreement is not executed by the participants before 8pm (GMT) on the day of the mediation, the participants may either elect to adjourn the mediation until a settlement agreement has been executed, or to end the  mediation without a settlement agreement having been executed. If the participants elect to adjourn the mediation, they each agree to proportionately share the cost of paying my fees charged at my standard hourly rate, in advance of any further meeting to conclude the mediation, i.e. on another full or half day.

Anecdotally, I had the great privilege of meeting with the late Professor Roger Fisher for two hours in his study at Harvard Law School during an academic visit from King’s College London in 2002, and his parting advice was,

‘Appreciate their point of view:

  • understand it – it’s very important to appreciate the way they see it,
  • even if you don’t agree, say that it merits serious consideration, don’t say that they are wrong.

Appreciate their self-esteem.

Acknowledge that the other person has been heard.

Be prepared to argue their case better than they can before you answer it.’

By the end of the Bar Council Mediator Training Course, I understood the wisdom that Professor Fisher (co-author of ‘Getting to Yes’ and a founding Father of principled negotiation) had imparted to me.

The secret or acme of mediation is authenticity, empathy, and active listening (without making matters worse!), which develops trust and enables the Mediator to create a safe space into which the participants feel empowered to enter and start a conversation that can lead to a solution of their own design and making, i.e. to a ‘deal’ that they own. This requires counter-intuitive thinking and behaviour, and is a lot harder to actually do than you might think.

Facilitative Mediation can be used to solve almost any kind of dispute, and does not require any legal, economic, business, social, political, or diplomatic knowledge and subject-matter expertise/experience by the Mediator. What it demands is skill in managing a process.

At the end of our meeting Professor Fisher went up to his bookshelf and handed me a copy of his book ‘Beyond Machiavelli’ which he inscribed, ‘To Carl – Another set of ideas!’

It is one of my greatest treasures.