At the risk of adding to crystal-ball gazing about the post-pandemic legal landscape, it is hard to resist speculating that mediation may ultimately join the list of things that have been available for many years but took the nudge of the pandemic to be embraced widely and come into their own.
A perfect storm of circumstances seems to have converged to provide ideal conditions for mediation and other forms of “alternative” dispute resolution to be finally embedded across the full spectrum of the English civil courts, rather than in the current patchy manner.
Some readers familiar with the history of efforts to promote mediation in the UK courts may, quite understandably, think they have heard this before. However, it is undeniable that in the last two years we have seen an increasingly serious discussion within both the judiciary and the UK government of the need for substantial paradigm shift in this regard. In the words of the Master of the Rolls, Sir Geoffrey Vos, “I have been sounding off on this subject quite a bit”. He has recently made clear his view that there is a need to completely rethink the way we deal with civil disputes, so that out-of-court resolution is in no sense “alternative” but a mainstream part of the dispute resolution process.
This post provides a snapshot of the various factors driving the push toward ADR and of the reforms being considered, including the now-likely easing of the English courts’ longstanding opposition to compulsory ADR.
Singapore Mediation Convention
At a global level, mediation has been increasingly in the spotlight since the 2019 signing of the Singapore Mediation Convention, which introduced a new legal mechanism for cross-border enforcement of mediated settlement agreements. The UK government is still to announce whether it will sign the Convention, and a public consultation on this is expected soon. However, as I have noted in a previous post, the Convention’s relevance to the UK is likely to lie less in the technical enforcement mechanism and more as a rallying point for highlighting the value of mediation and providing an impetus for domestic reforms.
Securing London’s disputes status
In recent years we have seen an increased openness by both the judiciary and government in acknowledging a need to defend and promote London’s status as a world leading centre for dispute resolution.
The English courts’ historical encouragement of out-of-court resolution has long been a feature of their attractiveness, particularly given the comparatively high costs of litigating here. But there are good grounds to believe that the courts’ approach to out-of-court resolution will become of increasing importance as a competitive factor in coming years.
In 2020, an All Party Parliamentary Group report examining how the UK can secure its position as a global disputes hub observed that, whilst the UK has a longstanding culture of embracing ADR, the infrastructural framework in some areas has failed to keep pace and insufficient resources have been dedicated to integrating ADR into civil justice processes. It emphasised a need for the UK to adapt to and lead the current global commercial movement towards mediation and conflict avoidance techniques if it is to remain at the cutting edge of dispute resolution.
That view is supported by data collected from the 2016-2017 Global Pound Conference (GPC) series, which surveyed thousands of dispute resolution stakeholders globally, including legal advisors, the judiciary and, importantly, corporate users. When asked what they thought would be the most significant factor for future commercial dispute resolution policy, participants from all jurisdictions except Asia regarded the efficiency of resolution processes as the key priority (over other factors such as certainty and enforceability of outcomes). Among those, the jurisdiction that most strongly prioritised efficiency was the UK. While efficiency will mean different things to different litigants, a system that does not make full use of all available tools to resolve disputes as early as possible is unlikely to remain competitive in this regard.
Heightened pressure on court resources
Well before the pandemic, there were of course already well-acknowledged strains on the resources of the English civil court system, for a variety of reasons involving increasing claim volumes as well as budget cuts. Relieving the pressures on the system is one of the key focuses of HMCTS’ ongoing £1 billion court and tribunal reform programme.
Against that backdrop, there has been wide concern at the prospect of the courts facing a backlog of cases built up during lockdown combined with future pandemic-related disputes. The courts’ relatively efficient (at least in some areas) pivot to remote court hearings at the start of lockdown has to some extent lessened the fears of a tsunami of backlogged cases overwhelming the courts. However, there is no question that the pandemic has placed significant extra pressure on an already stretched system and provided extra impetus for the reform process already underway.
A key objective of the reforms now being championed by the Master of the Rolls is to limit the matters that proceed to trial to the small proportion of total disputes that actually requires judicial determination.
The core initial proposal is for a new streamlined online system which will guide parties as necessary through signposting, pre-action portals and ultimately an online court if required. The key feature is the incorporation of a variety of different ADR processes, or ‘continuous mediated interventions’ at multiple points throughout the triage stages. These range from input by AI-informed bots through to face-to-face mediation or judicial early neutral evaluation.
While that online system will be designed to deal initially with what Sir Geoffrey describes as “the bulk end of the market” including small claims, he has suggested that it could ultimately be extended to commercial disputes in the Business and Property Courts to the extent it can be adapted to more complex claims.
Even outside the online system though, the aim is to instil in the entire system a culture change under which the focus is on resolution rather than dispute, and judges recognise that “we are not just there to referee a fight, we are there to break it up”.
Compulsory ADR – the end of Halsey?
That culture change can clearly be seen in the recent developments regarding the treatment of parties who unreasonably refuse to consider non-court resolution.
In early 2021, the Master of the Rolls requested that the Civil Justice Council (CJC) analyse both the (i) legality and (ii) desirability of the courts compelling litigants to engage in ADR procedures. In its report issued in summer, “Compulsory ADR” the CJC concluded that:
- It is lawful for parties to be compelled to participate in any form of ADR that is “not disproportionately onerous and does not foreclose the parties’ effective access to the court”.
- Such compulsion could in certain circumstances be “a desirable and effective development”.
The background to this is of course the Court of Appeal’s 2004 decision in Halsey v Milton Keynes General NHS Trust. For over 16 years, that decision has stood as authority that, although the courts can and should strongly encourage mediation (including imposing costs sanctions for unreasonable refusal), they must stop short of compelling unwilling litigants to participate. The primary objection in Halsey was that such compulsion would be an unacceptable constraint on litigants’ right of access to the court, in violation of Article 6 of the European Convention on Human Rights.
In the years since Halsey, the courts’ attitude to mediation has progressed significantly and become more nuanced. The clear trend has been toward stronger “encouragement”, at least retrospectively in a stricter approach to costs sanctions. In particular, judges have become increasingly less tolerant of parties justifying a refusal to mediate purely on the basis that they had a strong case (even where that has been vindicated by the result) or that the parties’ negotiating positions were “miles apart”.
As pressures on the system continued to increase and efforts to improve the uptake of ADR failed to meet expectations, the past decade has seen increasingly prominent voices calling for a reconsideration of the blanket prohibition on compulsory ADR. Perhaps most strikingly, that has included one of the judges who decided Halsey, Lord Justice Ward (in Wright v Michael Wright Supplies), who in hindsight queried the correctness of the ‘access to justice’ objection. More recently, the Court of Appeal in Lomax v Lomax was prepared to distinguish Halsey to compel unwilling parties to engage in early neutral evaluation.
Against that backdrop, the very making of the request for the CJC’s report can perhaps be seen as the more momentous development than the publication of the not unpredictable conclusions (which the Master of the Rolls has fully endorsed). It certainly demonstrates the seriousness with which the reforms are being pursued.
The CJC report did not make any detailed proposals, noting that more work is necessary to determine the types of claim and the situations in which compulsory ADR might be appropriate. Rightly, it recognised that civil disputes span a very broad spectrum, and that what may be necessary and helpful in one area of the system may not be in others.
A brave new world of remote mediation
While the pandemic has reinforced the need for a greater use of mediation, it has at the same time fortuitously prompted a development conducive to that. From the start of lockdown up until relatively recently, almost all commercial mediations that proceeded did so remotely. Mediators, lawyers and parties have been forced to quickly adapt to an online format, for the most part satisfactorily. Most practitioners agree that the remote format is likely to remain a permanent feature of the mediation landscape to some extent, including presenting the opportunity for “hybrid” mediations.
In the most recent Mediation Audit conducted by the Centre for Effective Dispute Resolution, the majority of commercial mediators surveyed anticipated that the emergence of online mediation will increase the level of mediation activity overall, and cross-border mediation in particular. Over half expected that online mediation will reduce the costs and time taken for mediation.
The full potential of online mediation is a topic for another day. But, as the CJC report stressed, the question of whether it will be reasonable for a court to expect the parties to undertake a mediation in any case will depend heavily on whether the costs and delay involved would be proportionate to the dispute. The potential for online mediation to affect the balance of that assessment is obvious.
In a welcome sign of government engagement, the CJC report was swiftly followed by the Ministry of Justice issuing a Call for Evidence on Dispute Resolution (the naming of which embraces the move away from treating non-court resolution as “alternative”). That document, which was endorsed by the judicial heads of the civil, family and administrative courts, was squarely on all fours with the CJC’s report and the reform proposals. It was a very wide-ranging call for input to inform government policy in this area, as the first step in a journey to “mainstream non-adversarial dispute resolution mechanisms”.
The Civil Mediation Council (CMC) has recently published its response to the Call for Evidence, which collated answers from its members. Amongst the detailed responses, it expressed support for mandatory dispute resolution ‘gateways’ to the courts to some extent, noting that even parties who are reluctant to mediate come to an agreement when they were not expecting to do so.
- The Master of the Rolls has announced that he has asked the CJC for a further report advising on “how the online dispute resolution space could work best with an emphasis on resolution rather than dispute”; and
- the CJC has recently issued an interim report within its ongoing review into Pre-Action Protocols, which of course includes the role of such protocols in encouraging pre-action ADR.
In summary, we now have perhaps the strongest indication for many years of a clear direction of travel toward the embedding of out-of-court processes within the civil disputes system. Where that path ultimately leads remains to be fleshed out. However, in the meantime, the clearly stated vision could potentially start to have an impact within case management, emboldening judges to take a more robust approach to encouraging mediation and challenging parties’ positions as to whether and at what stage mediation should take place.