06 October, 2016
Lord Justice Jackson delivered a speech last week "Civil Justice Reform and Alternative Dispute Resolution" which set out to explore the relationship between civil justice reform and Alternative Dispute Resolution. Jackson has been a prominent supporter of ADR and the role it has to play in reducing costs of civil disputes.
Since 2013 there has been a reported increase in the use of ADR, in particular mediation. Jackson commented that courts have been keener to grant orders in support of ADR and have made costs orders against those parties who unreasonably refused to mediate. The decision in PGF II SA v OMFS Co 1 Ltd in 2013 is considered a landmark decision. The Court of Appeal held that the defendant's silence in the face of two offers to mediate amounted to an unreasonable refusal to mediate which merited costs sanctions.
There are of course pros and cons to engaging in ADR. It can be expensive and time consuming but if successful can be quicker and cheaper than going to trial and should therefore be considered on case by case basis.
Parties may be required by the court to provide evidence that ADR has been considered. It is expressly recognised that no party can or should be forced to mediate or enter into any form of ADR but unreasonable refusal to consider ADR will be taken into account by the court when deciding who bears the costs of the proceedings.
What is clear is that Judges are being encouraged to promote ADR and therefore litigants should always consider ADR and ignore reasonable requests to engage in mediation at their peril.