When Mediation Conduct Does Not Save You From Costs: Lessons from Belson v Belson [2025] EWHC 2989 (Ch)
Master Clark’s judgment on costs in Belson & Ors v Belson & Ors [2025] EWHC 2989 (Ch) provides a significant and timely reminder of how the courts assess mediation conduct—and when arguments about a failure to mediate will not shift the default position on costs.
Although the First Defendant relied heavily on an alleged series of mediation invitations—over 20, according to his submissions—the court held that none of these attempts justified depriving the Claimants of their costs. The judgment provides a careful, practical analysis of what “refusing to mediate” really means, particularly where a party is under a fiduciary duty to provide proper disclosure before any meaningful settlement discussions can occur.
The Starting Point: Who Won?
The Claimants had succeeded in obtaining an account and, after a lengthy and difficult accounting process, were ultimately found entitled to further sums. The First Defendant, despite repeatedly asserting that he was actually owed money, was found liable on every account.
Master Clark held that the Claimants were clearly the successful party—and under CPR 44.2, costs should follow the event unless there is a compelling reason to depart from the general rule.
The First Defendant’s Argument: “They Refused to Mediate”
The First Defendant contended that the Claimants should be deprived of their costs because:
- They did not engage with his settlement or mediation proposals; and
- They recovered less than he said they had offered in their Without Prejudice Save As To Costs offers.
Master Clark rejected the argument that mediation conduct should determine the entire costs liability. CPR 44.2 requires the court to look at all the circumstances; mediation is only one part of that picture.
Why the Mediation Argument Failed
The judgment contains a detailed chronology of the First Defendant’s mediation or “meeting” proposals and the Claimants’ responses.
1. The Claimants Were Entitled to Proper Accounts First
The key point—repeatedly emphasised by the court—is that the First Defendant was a fiduciary.
He was under a positive duty to provide:
- clear accounting schedules,
- full documentary verification, and
- accurate explanations of transactions.
Only once this information was provided could the issues be identified and any mediation meaningfully pursued.
The First Defendant repeatedly failed to provide adequate or complete accounts:
- Early spreadsheets were incomplete and inconsistent.
- Account B and C lacked documents and detail.
- Account D was not provided.
- Later “purple text” revised accounts introduced new figures and claims months into the process.
- Even up to June 2024, his counsel admitted the accounting process was “continuing”.
The court accepted entirely that the Claimants’ refusal to mediate before the accounting was complete was not only reasonable—it was justified.
2. The First Defendant’s Correspondence Was Premature
The “20 attempts” to meet or mediate were, when analysed, either:
- before the Consent Order was made (and therefore irrelevant to post-Consent Order costs), or
- made in circumstances where the First Defendant still had not complied with his obligations.
The court noted that:
“I do not consider the claimants’ stance to be unreasonable or one which would justify depriving them of their costs.”
Far from being intransigent, the Claimants consistently said:
Once the accounting obligations are met, mediation can be considered.
They were entitled to take that position.
3. After February 2024, No Mediation Offers Were Made
Once the First Defendant changed representation and instructed direct access counsel, no further mediation offers were made at all.
This further undermined his suggestion that the Claimants had blocked alternative dispute resolution.
WPSATC Offers: Another Misfire
The First Defendant argued that because the Claimants recovered less than their earlier alternative-basis offers, costs should shift.
This too was rejected. When the court compared the offers with the recovery on a like-for-like basis, excluding costs, the Claimants achieved substantial (up to 82%) recovery.
Crucially, the Claimants could not reasonably have anticipated the court extending the relevant accounting period, nor could they have factored that into their offers.
The Outcome on Costs
Master Clark made the following key orders:
✓ The First Defendant must personally pay the Claimants’ costs from 5 September 2023 onwards.
This includes:
- the costs of the disposal hearing,
- the costs of addressing defective and incomplete accounts, and
- all post-Consent Order costs not already subject to specific orders.
✓ No indemnity from the estate
Because the First Defendant’s failings were personal and procedural—not fiduciary acts—he cannot reimburse himself from the estate or other trust funds.
✗ No indemnity basis costs
Although the First Defendant’s conduct caused disproportionate costs, Master Clark held that his behaviour was not “out of the norm” so as to justify indemnity costs.
Standard basis was therefore ordered.
✓ A payment on account of costs
In line with CPR 44.2(8), a reasonable interim payment was ordered.
Key Mediation Lessons from the Judgment
1. You cannot use “they refused to mediate” as a shield when you have not complied with disclosure or fiduciary duties.
Mediation must be viable. It cannot replace a statutory or fiduciary obligation to provide proper accounts.
2. Courts will look at the reasonableness of refusing mediation, not the quantity of offers.
The First Defendant made many offers, but they were premature or ill-founded.
3. Mediation is not a panacea for non-compliance.
Where a party has failed to meet fundamental procedural duties, mediation may be futile—and refusing to mediate in such circumstances will not be penalised.
4. Costs follow the event: mediation does not override outcome.
The First Defendant lost on the merits. His mediation narrative did not alter that.
A Useful Costs Precedent for Fiduciary and Trust Disputes
This judgment is a helpful authority for:
- trust and estate litigation,
- partnership and account cases,
- fiduciary duty disputes, and
- any case where mediation is raised as a costs issue.
It clarifies that:
A party cannot rely on the other side’s “failure to mediate” where they themselves have not complied with the core duties required to enable mediation to function.
Mediation is encouraged—but not weaponised.