UK: Court decision discouraging stays or 'windows' in trial preparation to allow for ADR

One way in which courts commonly encourage and facilitate the use of ADR  in the context of litigation is to allow the litigants a pause in trial preparation to engage in mediation or other form of settlement negotiations.   Such a pause may be in the form of a formal stay of the proceedings or by fixing a 'window' for such discussions when setting the trial preparation timetable.

However, in a recent decision, a judge in the Technology and Construction Court (TCC) (a division of the High Court) refused to fix a window for mediation and, in doing so, expressed the somewhat controversial view that the fixing of any lengthy window to allow for ADR 'is bad case management' because of the resultant delays to the trial date and increased costs: CIP Properties (AIPT) Ltd v Galliford Try Infrastructure Ltd & Ors [2014] EWHC 3546 (TCC).

The decision should certainly not be read as a rowing back from the overwhelming support that ADR enjoys among the judiciary in the UK.  The court stressed that it was not intending to undermine the crucial role ADR plays in the judicial system and that this was 'simply to emphasise that the parties must take all proper steps to settle the litigation whilst at the same time preparing the case for trial. It is not an either/or option.'  Nor will the  views expressed necessarily be followed by other judges, particularly in other courts.   However, they do represent an interesting development in the ongoing discussion about the role of ADR in the court system.   

Background

The ability of judges to stay or 'pause' proceedings to allow the parties to engage in ADR is well embedded in the English courts, and is reflected in various rules, pre-action protocols, court guidelines and the Jackson ADR Handbook.  In particular, the Civil Procedure Rules (CPR 26.4) provide that the court may stay proceedings to allow for ADR either at the request of the parties or on its own initiative (although this of course does not extend to ordering the parties to mediate).

In the present case, the issue arose in the course of a case management conference in a claim against a property development contractor.  The claimants proposed a mediation window of four months, prior to the disclosure of documents. The defendants were apparently amenable to mediation but strongly opposed any window for such being prior to disclosure - on the basis that, as assignees of the claims, they did not yet have sufficient information to enable them to mediate in a meaningful way.

(Other issues were also raised at the same time concerning the court's discretion to order costs budgeting - for more on these aspects of the decision, see our separate post here).

Decision

The judge (Coulson J) declined to provide for the window in the timetable - for four months or at all.  While acknowledging the crucial role that ADR has to play (noting that the TCC lists would otherwise be impossible to operate),  he stressed that the court needed to keep at the forefront of its consideration the requirement to put in place a cost-efficient and sensible timetable to lead up to a fixed trial date, on the assumption – which the court must make for these purposes – that there will be a trial.

Given the potential for lengthy ADR windows to delay the trial date and increase total costs if mediation is unsuccessful, they were  'usually inappropriate' and 'should not ordinarily be ordered'.  Staying the proceedings was considered 'an even worse option', given the potential for uncertainties around the ramifications of a stay and the possibility of parties taking advantage of such uncertainties for 'tactical games-playing'.

Rather, Coulson J considered that the appropriate way for ADR to be accommodated within TCC proceedings was for the court to set a sensible timetable allowing a reasonable period between each step in the process (say 2 months), so that the parties have sufficient time to consider their positions and attempt mediation if they wished before incurring the next tranche of costs.

Coulson J's reasoning was expressed primarily by reference to effective case management  - the fact that the window sought was opposed by the defendant was characterised as an additional supporting factor in this case.  However, it is clear that he was heavily influenced by this fact, commenting that not only was it inappropriate for the court to decide a dispute as to exactly when  parties should mediate but it was wrong in principle for the court to fix a window for ADR at a time when at least one significant party positively does not want it.

Comment

The approach adopted by Coulson J (and particularly his comments regarding stays, which were strictly obiter) will of course not necessarily be followed by other judges exercising their wide discretion as to case management.  A judge's assessment of whether a stay or window is appropriate will depend on various factors, including the length of the window proposed (the four months sought in the present case would be regarded at the longer end of the usual range), whether the parties are in agreement, and how tightly scheduled timetables for trial preparation commonly are in that particular court.  It is clear that Coulson J's preference for ADR to be accommodated within a generously-spaced timetable was based on his perception that that is in fact how timetables in the TCC are routinely set.  That may not be considered to be the case in other courts.

Further, although not referred to by Coulson J, it is also worth noting that the TCC can be distinguished from many other courts in that the TCC  pre-action protocol provides for a type of ADR  - requiring there to be at least one face-to-face meeting between the parties before proceedings are commenced. The TCC Guidelines note that  '(A)s a result of this procedure having taken place, the court will not necessarily grant a stay of proceedings upon demand and it will always need to be satisfied that an adjournment is actually necessary to enable ADR to take place.'

Coulson J's comments can be seen as part of a wider school of thought concerned about the potential for ADR procedures to delay court proceedings and act as an obstacle to parties exercising their rights to justice (which is one of the key objections to making mediation mandatory before the commencement of proceedings).  Some of course would question his stated view that the interests of case management must always trump the interests of ADR wherever the two conflict - and his assumption that the courts' priority must always be the progress toward trial.   At the heart of the differing views is the fundamental question of the extent to which ADR should be regarded as an intrinsic part of the court system that judges are charged with administering, rather than a separate adjunct to it.

Jan O’Neill

Professional Support Lawyer,
Dispute Resolution, London
Email
+44 20746 62202