Mediation – are parties now forced to mediate disputes?

30 November 2023

The Court of Appeal considered this in the case of Churchill v. Merthyr Tydfil County Borough Council [2023] EWCA Civ 1416; a decision handed down on 29th November 2023 following a two-day hearing on 9 and 10 November.  The promptness of the judgment is to be commended.

There were a number of questions before the court.  The headline questions in this case were whether a court can lawfully order the parties in court proceedings to engage in a non-court-based dispute resolution process, and, if so, in what circumstances it should do so.  Previously, in Halsey v. Milton Keynes General NHS Trust [2004] EWCA Civ 576, [2004] 1 WLR 3002 (Halsey), Lord Justice Dyson's remarks had been perceived as a barrier to mediation.  The rationale being that forcing unwilling parties into mediation infringed their right to court access. 

In paragraph 75 (ii) of his judgment in the Churchill case Sir Geoffrey Vos (the Master of the Rolls) states:

The court can lawfully stay proceedings for, or order, the parties to engage in a non-court-based dispute resolution process provided that the order made does not impair the very essence of the claimant’s right to proceed to a judicial hearing, and is proportionate to achieving the legitimate aim of settling the dispute fairly, quickly and at reasonable cost.

However, in the following paragraph 75(iii) he states:

“I decline to lay down fixed principles as to what will be relevant to determining the questions of a stay of proceedings or an order that the parties engage in a non-court-based dispute resolution process. Many of the factors mentioned at [61]-[63] above and the nature of the process contemplated will be relevant, as will other circumstances.” 

At one level all the court has done is to confirm that the court has the power to stay proceedings.  I suspect most litigators have been advising on this basis for many years. While the court had the opportunity to prescribe factors that the court should consider when exercising its discretion, it chose, and in my view, wisely, not to do so.  While themes in litigation are often generic, individual matters are unique and judges need to retain the flexibility to determine matters on a case-by-case basis.

Although this case concerned an application for a stay, we should never forget that failing to engage in mediation or other ADR can have adverse cost consequences.  Judges are not slow to use their discretionary powers to penalise parties with adverse cost orders for failing to mediate or, indeed, failing to engage in constructive negotiations throughout the litigation, if they consider it would have been reasonable to do so.

The answer to the question above is that while a court cannot force a party to mediate constructively it can order that mediation take place in certain circumstances.

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