For almost 10 years there has been debate whether parties to litigation could be compelled to engage in mediation or other non-court dispute resolution process.
The courts of England & Wales have long had the power to encourage the use of non-court- based dispute resolution processes including the ultimate threat to penalise a party who unreasonably refuses an invitation to engage in such process. The reasoning is simple, alternative dispute resolution is quicker and less expensive than court proceedings. The courts have the power to stay proceedings to permit an alternative process to be used, but could the courts exercise that power where the parties or one of them simply refused to engage in such a process.?
Since the 2004 judgment of the Court of Appeal in Halsey v Milton Keynes General NHS Trust [2004] EWCA Civ 576 it was thought that a court could not mandate the use of non-court-based dispute resolution process because to do so, “would impose an unacceptable obstruction to their right to access to the court.” Among other authorities, the court in Halsey considered several judgments issued by the European Court of Human Rights and which centred around article 6 of the European Convention on Human Rights and the principle of the right to a fair trial.
For almost a decade the decision in Halsey has been held up as authority for saying a court could not compel a party to engage in mediation who did not want to.
The tables are turning. In the very recent Court of Appeal decision in Churchill v Merthyr Tydfil County Borough Council {2023] EWCA Civ 1416 the Court of Appeal ruled that a court could lawfully stay proceedings for and order the parties to engage in a non-court-based dispute resolution process. There were two provisos to this: a) such an order should “not impair the very essence of the claimant’s right to proceed to a judicial hearing; and b) and should be proportionate to achieving the legitimate aim of settling a dispute fairly, quickly and at a reasonable cost.”[1]
The facts of Churchill are that Mr Churchill was in dispute with Merthyr Council in relation to an incursion of Japanese knotweed onto Mr Churchill’s property from the Council’s adjoining land. The Council argued that it offers a dispute resolution process which Mr Churchill ought to have used. Mr Churchill did not want to use that process and proceeded to issue court proceedings. The Council applied to stay the proceedings on the basis that Mr Churchill should be required to use its dispute resolution process. The judge at the first hearing declined to stay the proceedings in circumstances where Mr Churchill did not want to engage in that process but did say that he found Mr Churchill’s refusal to have been unreasonable. The issue was referred to the Court of Appeal and from its judgment, it is clear now that parties can be compelled by the court to engage in non-court-based dispute resolution.
I have been a dispute resolution lawyer for a long time, I sit as an arbitrator, and I am a mediator. I have no doubt about the benefits of mediation over litigation. Mediation is much quicker and much less costly than court proceedings and most importantly, it is better for the parties to reach their own resolution rather than to have one imposed on them by a judge or an arbitrator. But should a party be forced to engage in mediation when he simply does not want to? There is a danger that faced with an order to mediate, that the recalcitrant party might just go through the motions and refuse to reach any resolution in mediation and in doing so may avoid an adverse costs order.
It is sacrosanct that what goes on in mediation cannot be referred to in subsequent court proceedings, it is also a contractual provision in all mediation agreements that neither party shall call the mediator as a witness in any subsequent court proceedings. Both principles are very important to give the parties a safe place to exercise the give and take required in any mediated settlement. This raises the question, how will the court know if the party compelled to mediate has simply gone through the process with no genuine intention of reaching a resolution, and how then would it be able to impose any costs sanction?
Mediation and other non-court-based dispute resolution processes should be encouraged at all stages, but compulsion should be exercised with considerable caution.
[1] Sir Geoffrey Vos, Master of the Rolls
