In a recent consultation published by the government, new plans have been unveiled to divert more disputes away from the court.

The proposals put forward by the Ministry of Justice includes compulsory free mediation for claims worth up to £10,000. Last year figures showed that of the 1.6 million claims issued, 98,000 of them were allocated to the small claims track with 39,000 small claims trials occurring. On average these claims took just under a year to go to trial.

It is estimated that the proposals could help settle around 20,000 cases per year, and around 272,000 people.

As part of the proposals unveiled, the parties would be automatically referred to a free hour-long telephone session with a mediator provided by HM Courts & Tribunals Service before the case can progress to a hearing.

Each party will separately talk to a mediator to assess whether there is any common ground. If the parties are able to agree a settlement over the phone, then it would be formalised through a legally binding settlement agreement.

It is suggested that for larger cases, the Small Claims Mediation Service should remain on an opt-out basis.

It should be noted that personal injury and housing disrepair claims are excluded from the plans.

The consultation is estimated to last for 10 weeks and a response to it will be published in due course. During the consultation, the Government is seeking views regarding the proposals.