Court of Appeal decision puts at risk those refusing to respond to an invitation to engage in ADR.

Tuesday, 29th October 2013

On 23rd October 2013, the Court of Appeal ruled on a case to 'send out an important message to civil litigants, requiring them to engage with a serious invitation to participate in ADR, even if they have reasons which might justify a refusal, or the undertaking of some other form of ADR, or ADR at some other time in the litigation' * [Click here to read Lord Justice Briggs's Judgment]In case there was any doubt that the ground is shifting further towards mediation, Lord Justice Briggs concluded his judgment by saying:‘The court's task in encouraging the more proportionate conduct of civil litigation is so important in current economic circumstances that it is appropriate to emphasise that message by a sanction which, even if a little more vigorous than I would have preferred, nonetheless operates pour encourager les autres.' This case establishes that 'silence in the face of an invitation to participate in ADR is, as a general rule, of itself unreasonable, regardless whether an outright refusal, or a refusal to engage in the type of ADR requested, or to do so at the time requested, might have been justified by the identification of reasonable grounds' . The case has been heralded by the Law Society Gazette which commented that 'The Court of Appeal has thrown its weight behind alternative dispute resolution in another example of tough enforcement of the Jackson reforms'. So what does that mean, in practice?Firmly endorsing Paragraph 11.56 of the 2013 ADR Handbook, the Court of Appeal reiterated the steps that a party, faced with a request to engage in ADR, should consider in order to avoid a costs sanction. Even if it believes that it has reasonable grounds for refusing to participate at that stage. These steps are:a) Not ignoring an offer to engage in ADR;b) Responding promptly in writing, giving clear and full reasons why ADR is not appropriate at the stage, based if possible on the Halsey guidelines;c) Raising with the opposing party any shortage of information or evidence believed to be an obstacle to successful ADR, together with consideration of how that shortage might be overcome;d) Not closing off ADR of any kind, and for all time, in case some other method than that proposed, or ADR at some later date, might prove to be worth pursuing.Andrew Hildebrand, Mediator, In Place of Strife, © 2013

* PGF II SA v OMFS Company 1 Limited, [2013] EWCA Civ 1288, per Lord Justice Briggs, at para 56

http://www.bailii.org/ew/cases/EWCA/Civ/2013/1288.html