Alternative Dispute Resolution

This module is called ‘dispute resolution’. Its predominant focus is on litigation – but its goal is to equip you with the legal tools to resolve disputes. The Courts are consistently encouraging litigants to see litigation as a measure of last resort and both clients and their lawyers can be punished if they fail to adopt a robust approach to resolving a dispute without the intervention of the Courts.

ADR, or ‘Alternative Dispute Resolution’ is a collective term for settling disputes without litigating the case in Court. It takes different forms which we will explore in this course. But the purpose of all forms of ADR is essentially to narrow the areas of dispute between the parties and to resolve the dispute without litigation if at all possible.

ADR is voluntary and ‘without prejudice’.  Judges won’t be made aware of ADR until after the issue of costs is to be considered. All forms of ADR are less formal than Court proceedings. They are a forum in which the parties can be open about their own cases and, hopefully, about their strengths and weaknesses. This atmosphere of informality and transparency should be conducive to reaching a settlement if at all possible.

A solicitor should always discuss possibility of ADR unless it is obviously inappropriate. It could also be inappropriate if the other party is completely unwilling to cooperate or the other party cannot be trusted to comply with the outcome of ADR. However, as a solicitor instructed in civil litigation, you should certainly treat it as a presumption that you should advise your client to engage proactively in ADR.

This obligation to consider ADR does not stop after the pre-action stage of proceedings. At all stages the parties must consider settling litigation through ADR. If either party not engaging the party must serve a witness statement giving reasons within 21 days of the proposal being rejected. This will be shown to the Judge if costs issues arise.

Some cases which illustrate the Court’s approach in compelling engagement in ADR can be found in: Halsey v Milton Keynes General NHS Trust [2004] EWCA CIV 576; Laporte  v Commissioner of Police for the Metropolis [2015] EWHC 371; Gore v Naheed and Ahmed [2017] EWCA CIV 369.

Halsey v Milton Keynes General NHS Trust

The court considered the effect on costs orders of a refusal to take part in alternate dispute resolution procedures. The defendant Trust had refused to take the dispute to a mediation. In neither case had the court ordered or recommended ADR.

The Court held that if the parties (or at least one of them) remain intransigently opposed to ADR, then it would be wrong for the court to compel them to embrace it. The claimant in Halsey had sought mediation as a matter of tactics.

Lord Justice Dyson said: ‘The court’s role is to encourage not to compel.’ but ‘In deciding whether to deprive a successful party of some or all of his costs on the grounds that he has refused to agree to ADR, it must be borne in mind that such an order is an exception to the general rule that costs should follow the event. In our view, the burden is on the unsuccessful party to show why there should be a departure from the general rule. The fundamental principle is that such departure is not justified unless it is shown (the burden being on the unsuccessful party) that the successful party acted unreasonably in refusing to agree to ADR.’ An effective compulsion to arbitrate might in human rights law be an unacceptable restraint on a party’s right of access to court.