Mediation as a Litmus Test for Litigation Capacity
What the High Court’s decision in TLA v Chelsea and Westminster Hospital NHS Foundation Trust reveals about the centrality of ADR in modern litigation
Introduction
When a High Court judge recently had to decide whether a litigant in person possessed the mental capacity to conduct his own claim, she turned to an unexpected benchmark: his ability to reason about mediation. The decision in TLA v Chelsea and Westminster Hospital NHS Foundation Trust [2026] EWHC 1751 (KB) was, on its face, a ruling on litigation capacity under the Mental Capacity Act 2005. Yet it quietly delivered a powerful message about the status of alternative dispute resolution in our civil justice system. Mediation, the judgment suggests, is now so integral to the conduct of litigation that a person’s capacity to understand, weigh and make decisions about it can serve as a reliable indicator of their capacity to litigate at all.
The capacity framework
Before examining how mediation featured in the court’s analysis, it is worth recalling the legal test for litigation capacity. Under sections 2 and 3 of the Mental Capacity Act 2005, a person lacks capacity in relation to a matter if, because of an impairment of, or disturbance in the functioning of, the mind or brain, they are unable to make a decision for themselves. That functional inability is broken down into four limbs: understanding relevant information, retaining it, using or weighing it, and communicating a decision. The presumption is always one of capacity, and a person is not to be treated as unable to make a decision merely because they make an unwise one.
Litigation capacity is issue- and time-specific. The “matter” in TLA was whether the Claimant, an unrepresented individual pursuing a complex claim for breach of confidence and psychiatric injury, could conduct the proceedings. The court had to identify the sorts of decisions he would need to make and then ask whether his mind could perform the cognitive tasks required.
Mediation’s place in the capacity assessment
The Defendant’s expert, a consultant psychiatrist, had opined that the Claimant’s paranoid personality disorder so distorted his thinking that he could not weigh information, particularly when it came to settlement. She believed his intense antipathy toward the Defendant rendered him incapable of compromise, making any mediation futile and demonstrating a broader functional inability. The Claimant’s own expert, a psychologist, disagreed, and the judge ultimately preferred the latter’s view.
What is striking is how the judge tested the competing opinions. She did not simply review the psychiatric notes in the abstract. She looked at the Claimant’s concrete litigation decision-making, and central to that examination was his approach to mediation.
From the judgment, we learn that the Claimant:
· Recognised that the case was statistically likely to settle through mediation and expected the court to order it.
· Had previously rejected a mediation offer, but gave two reasoned explanations: he first wanted full disclosure to identify all potential causes of action and thus achieve finality, and he found the Defendant’s offer to fund legal advice during mediation insufficiently specific.
· Understood that the Defendant would not tolerate a “moving target” and accepted that his stated conditions for entering mediation were now “on the record”, implying a commitment to be held to them.
· Could articulate both advantages (saving the public purse, protecting his privacy) and disadvantages (losing the chance to publicly expose the Defendant’s alleged systemic failures) of settling via mediation.
When the Claimant gave this evidence, the judge was not conducting a mediation hearing. She was conducting a capacity assessment. Yet she treated his ability to navigate these mediation-related considerations as highly probative of whether he could use and weigh information generally. In her analysis, she noted that he was “able, when asked, to identify competing considerations … and explain why some factors were of greater importance to him than others and therefore weighed more heavily in his considerations.” The evidence he gave, she said, “was coherent and considered, even if others would approach the relevant factors and balancing exercise differently.”
In other words, mediation reasoning became the functional test that the Claimant passed, rebutting the suggestion that his paranoia robbed him of decision-making ability.
Why this matters: mediation as a pillar of modern litigation
The TLA judgment did not set out to make a point about ADR. It is a capacity case. But by using mediation-related decision-making as a yardstick for litigation capacity, the court implicitly confirmed what practitioners have long known: mediation is no longer an optional add-on. It is a core component of the litigation process, so deeply embedded that the mental toolkit required to litigate now includes the ability to evaluate settlement options rationally.
This is consistent with the evolution of civil procedure over the past quarter-century. The overriding objective in CPR Part 1 compels the court to deal with cases justly and at proportionate cost, which includes encouraging the parties to use ADR if appropriate. The pre-action protocols demand that parties consider negotiation and mediation before issuing. A long line of authorities, from Halsey v Milton Keynes General NHS Trust [2004] EWCA Civ 576 to PGF II SA v OMFS Co 1 Ltd [2013] EWCA Civ 1288, has established that an unreasonable refusal to mediate can carry severe costs consequences. Mediation is no longer seen as a private, voluntary sideshow; it is a procedural step that responsible litigants are expected to take and that courts are entitled to facilitate, and in some cases even compel.
TLA takes this integration a step further. If a litigant’s capacity to conduct proceedings is to be assessed, the assessment must now consider whether they can meaningfully engage with the prospect of mediation. A person who is unable to understand what mediation involves, why it might be beneficial or what the consequences of rejecting it might be could, in an appropriate case, be found to lack litigation capacity—not because they refuse to mediate, but because their refusal stems from a cognitive inability to process the information relevant to that decision.
Conversely, the case sends a clear signal that a litigant who can articulate a reasoned, coherent position on mediation—even one others view as intransigent or unwise—will be presumed to have capacity in that domain. The principle of autonomy, expressly preserved by section 1(4) of the Mental Capacity Act, protects the person who makes an “unwise” decision to fight on rather than settle. It does not protect the person who, through a disturbance of the mind, simply cannot weigh the option at all.
Implications for practice
For practitioners, the decision has two main implications. First, those conducting capacity assessments in a litigation context should now include ADR decision-making as a distinct area of inquiry. The “information relevant to the decision” (for the purposes of section 3 of the Act) must encompass not only the merits of the claim and the trial process but also the availability of mediation, its typical structure, the costs risks of refusal and the potential non-financial outcomes that settlement can achieve. An assessor who neglects this domain may produce an incomplete opinion.
Second, the case should prompt courts and legal representatives to be alive to the possibility that a litigant’s obstinate refusal to mediate may, in extreme instances, be a red flag for incapacity rather than mere unreasonableness. Of course, mere hostility to ADR is not evidence of impairment. But if that hostility is accompanied by an inability to comprehend what mediation is or to retain and weigh even the most basic information about its pros and cons, the question of capacity may legitimately arise. TLA demonstrates that the line between “unwise” and “unable” can be explored precisely by asking the litigant to walk through their reasoning on mediation, just as the Claimant was asked.
Conclusion
At first blush, TLA v Chelsea and Westminster Hospital NHS Foundation Trust is a judgment about mental capacity and the diagnostic pitfalls of conflating strong feelings with functional impairment. Beneath the surface, however, it is a quiet testament to how far ADR has travelled from the periphery to the core of civil justice. Mediation is now so integral to litigation that the capacity to think about it sensibly can serve as a proxy for the capacity to litigate itself. The case stands as a reminder that in the modern procedural landscape, knowing how to mediate is part of knowing how to litigate—and the courts will measure your capacity by that standard.