Legal Futures reports that a judge has made the first ever order for compulsory alternative dispute resolution (ADR) in commercial litigation,
The Courts have long had power to order parties to consider mediation but this went one step further by ordering that the parties were to “meaningfully engage in the mediation process in a genuine attempt to reach settlement of these proceedings”.
The order continued: “The mediation shall be conducted on a without prejudice save as to costs basis and either party shall be at liberty to make an application relying on evidence as to the conduct of the parties at the mediation either with regards to the cost consequences of that conduct or with regards to the court deciding whether or not either party has failed to engage with the mediation process.”
The Ministry of Justice is currently investigating how to increase the use of ADR following a report on compulsory ADR by the Civil Justice Council working group, chaired by Lady Justice Asplin, of which Peter Causton is a member.
It concluded that compulsory ADR was lawful, as long as the parties remained free to choose to continue their litigation if necessary.
We have recently concluded an 18 month study funded by the EU into ADR use by consumers – our report can be found at promediate.co.uk/adr-roadshow
It is said that the courts already have the power to order compulsory ADR under CPR 3.1(m).
This states that the court can “make any other order for the purpose of managing the case and furthering the overriding objective, including hearing an early neutral evaluation, with the aim of helping the parties settle the case”.
However, I am not sure this would encompass compulsory mediation.
We do have reservations about this order being the solution. It appears to open up the mediation to scrutiny when it is meant to be confidential and without prejudice. It is very difficult to tell if a party is negotiating in good faith. This type of order potentially undermines the process and opens the parries up to satellite litigation.