Extra home

Mediation
The use of a mediator to help reach a settlement in a dispute. Mediation differs from arbitration in that a mediator will not come down on one side or the other and make an award. The aim of mediation is to persuade the parties to reach agreement and not to impose a ruling that has to be obeyed. Some County Courts now operate mediation schemes, which can be very effective and may avoid the expense of solicitors. See also ADR.

Memorandum of Incorporation
The part of a company's charter or byelaws that defines the extent of its objects and its authorised capital. A company cannot act outside its permitted objects. See Ultra vires.

Minor
In England, a person under the age of 18. In Scotland, a person under 16.

Mitigation
A claimant has a duty to limit his loss or injury where reasonably possible. Thus an employee who is wrongfully dismissed must seek alternative employment and, if he finds it, the earnings from his new employment will be offset against his damages. But he is not obliged to accept an offer of employment that is unsuited to his skills or experience.

Motor Insurers' Bureau
A group of motor insurers, which has agreed with the government to provide cover in certain circumstances, notably where a motorist responsible for an accident has no compulsory third party insurance.

Mortgage or Legal charge
An arrangement by which a borrower (the mortgagor) provides a lender (the mortgagee) with security for the repayment of a loan. In the typical case of a house mortgage, the borrower continues to occupy the property and will assume full ownership again when the loan is repaid. However, if payments are not made to the lender, he may take steps to enforce his security, usually by selling it, but he will need the approval of the court. If the proceeds of sale exceed the outstanding debt, the excess must be refunded to the borrower. See also Endowment mortgage, Interest free mortgage, Pension mortgage and Repayment mortgage.

Negative equity
When the amount owing to the mortgagee exceeds the market value of the property provided as security, the difference is called the negative equity.

Negligence
Everyone owes a duty to take reasonable care not to injure or cause loss to his neighbour. If he fails to do so and the neighbour suffers damage as a result, the tort of negligence has been committed. The courts are constantly considering exactly what is reasonable and who is a neighbour, and it has been said that the categories of negligence are never closed.

Net wages
The pay received by an employee after all employer's deductions, such as tax and national insurance, have been subtracted.

Nominal share capital
The amount of share capital that a company is allowed to issue. When the company is incorporated, this is stated in its Memorandum of Association. For example, "£100 divided into 100 shares of £1 each. The shares are then said to have a nominal, or "par", value of £1 each and, if the company wants to issue more than 100 of them, it must pass a resolution to increase its capital.

No-win-no-fee
A conditional fee agreement between a solicitor and client that the solicitor will be paid only if the client's claim is successful.

OFT (Office of Fair Trading)
The organisation set up to police the Fair Trading Act designed primarily to protect the rights of consumers.

Ombudsman
An official appointed to investigate complaints by individuals against maladministration by public authorities. There is a Legal Services Ombudsman whose website is www.olso.org.

Order
See Judgment.