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ADR: bound to negotiate?

Is a contract clause to refer a dispute to mediation enforceable?
Tim Strong reports on a recent case

22 November 2002

It is increasingly common for the dispute resolution provisions of contracts to include some reference to the parties attempting ADR in the event of a dispute. A recent High Court decision addressed whether such a provision can oblige a party to enter into what is essentially a consensual process. I have often been asked, particularly by clients in the IT industry, whether a clause in one of their contracts saying mediation will be attempted in the event of a dispute (usually before court proceedings are commenced) is enforceable. My response has always been that it probably would be, subject to the court’s discretion, but that I could find no specific authority on the point. On 11 October 2002, we were given one. Colman J’s decision In Cable & Wireless plc v IBM United Kingdom Ltd [2002] EWHC 2059, Colman J in the Commercial Court adjourned proceedings brought by Cable & Wireless for declaratory relief in relation to a contract, on the grounds there was a bin...

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