Paula Kumar considers the creation of a ‘compulsory’ element to ADR

In the summer of 2021, the Civil Justice Council published a report which concluded it may be desirable for alternative dispute resolution (ADR) to be compulsory in civil litigation cases. While there have been no specific proposals for reform at this stage, ADR is encouraged by the courts, and in some claims is already compulsory. Should ADR be the norm in civil disputes, with litigation remaining an option later, and is this proportionate?

Precedent

It was previously considered in Halsey v Milton Keynes [2004] 1 WLR 3002 that forcing unwilling parties to mediate was contrary to the right to a fair trial, as it prevented access to the courts. However, more recently, Lomax v Lomax [2019] EWCA Civ 1467 considered the “court’s engagement with mediation has progressed significantly since Halsey was decided” – and the court held that it had the power to order Early Neutral Evaluation even where a party objected.

As Sir Geoffrey Vos, Master of the Rolls and Head of Civil Justice, commented, “ADR should no longer be viewed as ‘alternative’ but as an integral part of the dispute resolution process; that process should focus on ‘resolution’ rather than ‘dispute’”. One of the key principles that must be applied if ADR is to become compulsory is to allow parties the freedom to issue or continue court proceedings if the matter is not settled.

Principles

Another key principle is ADR must not be disproportionately onerous or costly. It can be an effective tool to reduce costs and resolve a matter at an early stage, but an also cause delays and ultimately push the final resolution further down the line. Costs can be significantly increased if parties engage in ADR but do not resolve the matter and therefore have no option but to continue, with mounting litigation costs. While some ADR services are free, there is no suggestion compulsory ADR across all sectors should be available without charge.

Certain types of claims already require tparties to engage in some form of ADR. There is also the question of timing – at what stage of proceedings should ADR take place? The types of cases that the courts deal with are incredibly wide-ranging, and it would not be appropriate to adopt a blanket approach. For example, in the Employment Tribunal, an employee is only able to issue proceedings once they have obtained an Early Conciliation (EC) certificate. To get this, the employee must contact ACAS, who offer Early Conciliation and attempt to resolve the dispute. If either party is not interested in settling the matter, or the Early Conciliation is unsuccessful, ACAS will issue an EC certificate, with which the employee can issue proceedings. Between April 2020 and March 2021, almost 70 per cent of cases did not lead to the employee issuing a claim in the Employment Tribunal, so the service can be very effective.

In complex commercial cases it might be more appropriate to engage in ADR at a later stage, such as after pleadings have been filed, or disclosure has been exchanged. In these cases, should it be left to the court to decide as part of its case management powers if, and when, to order that the parties engage in ADR?

Before you can issue an application in the Family Court, both parties are required to attend a mediation information and assessment meeting (MIAM), unless either party satisfies one of the exemptions. If either party does not wish to mediate, the mediator will sign a form to attest mediation is not appropriate in the case. This will allow the applicant to issue an application at court, in line with the principle that parties should have access to court proceedings.

There are also voluntary mediation schemes offered by the courts. In the Employment Tribunal, parties can make use of a free voluntary service known as judicial mediation. The Small Claims Court also offers a free voluntary mediation service for claims under £10,000.

Progress?

You cannot force a party to reach an agreement, but you can facilitate an open discussion to seek to resolve issues. There is always the risk parties will not fully engage with the process and have no intention of settling a matter. Measures may be open to the court if it appears that a party has failed to comply or effectively engage in ADR. Such measures could include a costs order or striking out a party’s case, but will clearly depend on the circumstances and stage of the proceedings.

All in all, parties spend a great deal of time, energy and money in pursuing and defending proceedings, and if ADR is successful in limiting those pressures, then it should be welcomed. If it is not successful in resolving the dispute at an earlier stage, it may still be effective in narrowing the problems or encouraging the parties to carefully consider the issues and whether they are still intent on maintaining their position. That is the power of compulsory ADR.

Paula Kumar is partner and head of dispute resolution at Thomas Mansfield Solicitors: thomasmansfield.com

Paula Kumar
Partner, Head of Dispute Resolution
Thomas Mansfield Solicitors