29 November 2023 was a milestone date for mediation, where the Court of Appeal handed down judgment in the landmark case of Churchill v Merthyr Tydfil.  The voluntariness of mediation was thrown into confusion by Halsey in 2002, with subsequent cases being inconsistent in its application, making requests to mediate a minefield to navigate.  Given the significance of this case, Laricelle and Nim consider what clarity Churchill has brought.

TO MEDIATE OR 'KNOT' TO MEDIATE

There has been a significant amount of media attention and coverage surrounding this case in the last few weeks. The Appeal Court handed down the Judgement on 29 November 2023. It is worth exploring why this case is receiving so much attention and what the potential implications of this may be. Let's delve deeper into the matter.

Churchill v Merthyr Tydfil

Implication of the Judgement

This Court of Appeal Judgement empowers the court to order non-court-based dispute resolution, even beyond the threat of cost sanctions for parties who unreasonably refuse ADR. The decision of the Court of Appeal plays a significant role in small-value claims, where the legal costs are often disproportionate to the sums of money which are being claimed.

Earlier this year, we saw a commitment by the UK government in respect of the Small Claims Court, where cases under £ 10,000 are offered compulsory one-hour telephonic mediation with a court-appointed mediator. There is some speculation that this may expand into Personal Injury and Housing Claims.

Although there is not a precise definition for the term non-court-based dispute resolution yet, it could refer to several procedures such as mediation, negotiation, round table meetings, and non-binding expert determination. Whether the parties or the courts will define this phrase is still up in the air.

When would the courts consider there to be sufficient engagement in the process, or failure to be properly engaged, triggering cost awards if parties see it as a tick-boxing exercise?

Although the groundbreaking decision was positively received by many, it remains unclear how it will be put into practice. Nonetheless, we are eagerly anticipating the first court order that mandates the use of an alternative dispute resolution process to settle legal disputes outside of the traditional court system.

HOW CHURCHILL WON THE WAR FOR MEDIATION

In one of the most important recent decisions in civil litigation, particularly in the climate of backlogs and fixed fees, the Court of Appeal handed down its judgment in James Churchill v Merthyr Tydfil County Borough Council (the Council).

The decision confirmed that judges have the power, in appropriate circumstances, to order parties to participate in alternative dispute resolution (ADR) providing a further boost to ADR as a central and important part of the dispute resolution landscape.

Background

Having purchased a house in Merthyr Tydfil, James Churchill noticed Japanese Knotweed growing in his garden. The Council acknowledged that they had previously treated Japanese Knotweed on the neighbouring land they owned for several years.

Mr Churchill sought compensation for losses incurred in respect of the encroachment of the Japanese Knotweed onto his land. The Council denied liability but referred Mr Churchill to their internal Corporate Complaints Procedure.

Ignoring the request Mr Churchill issued proceedings in the County Court and the Council applied for a stay of the proceedings on the basis that the Corporate Complaints Procedure should be completed first.

The first hearing

While the Judge found that Mr Churchill and his lawyers had acted unreasonably and contrary to the spirit and the letter of the Practice Direction for Pre-Action Conduct (PD) in refusing to use the internal complaints procedure, he nevertheless dismissed the Council's application to stay the proceedings.

The Judge held that he was bound to follow Dyson LJ’s statement in Halsey v. Milton Keynes General NHS Trust [2004] EWCA Civ 576, [2004] 1 WLR 3002 (Halsey) to the effect that: “to oblige truly unwilling parties to refer their disputes to mediation would be to impose an unacceptable obstruction on their right of access to the court”.

The Council appealed the decision.

Where there is no applicable Protocol within the CPR, as was the case for Mr Churchill's claim, pre-action conduct is regulated by the PD which requires pre-action behaviour aligned with that required under the Protocols and provides specifically that before commencing proceedings the court “expect the parties to have exchanged sufficient information to – … (c) try to settle the issues without proceedings; (d) consider a form of Alternative Dispute Resolution (ADR) to assist with settlement; … and (f) reduce the costs of resolving the dispute”.

Importantly, the PD notes that “[l]itigation should be a last resort. … the parties should consider whether negotiation or some other form of ADR might enable them to settle their dispute without commencing proceedings”.

If proceedings are issued, “the parties may be required to provide evidence that ADR has been considered”, and that a party’s refusal to participate in ADR might be considered unreasonable and lead to an order to pay additional costs.If a party has “unreasonably refused to use a form of ADR or failed to respond at all to an invitation to do so” the court may decide that there has been a failure to comply. 

In such circumstances, the defaulting party may be subject to sanctions (primarily in respect of costs) or it may be that the “proceedings are stayed while particular steps are taken to comply” with the PD.

The issues and decision

The Court of Appeal addressed a series of issues, but the key elements are follows:

1)    Can the court lawfully stay proceedings for, or order the parties to engage in, a non-court-based dispute resolution process?

The Court of Appeal held that they could lawfully stay proceedings for, or order, the parties to engage in a non-court-based dispute resolution processes provided that the order made does not impair the very essence of the claimant's right to proceed to a judicial hearing and is proportionate to achieving the legitimate aim of settling the dispute fairly, quickly and at reasonable cost.

2)    How should the court decide whether to stay the proceedings for, or order, the parties to engage in a non-court-based dispute resolution process?

The Court of Appeal noted that this would need to be considered on a case-by-case basis and was not prepared to impose a fixed set of principles as to what may be relevant.The judgment does, however, provide some guidance as to the factors to be considered to establish if a party has unreasonably refused to engage in ADR.The court will generally weigh the circumstances of the case to the form of ADR proposed to understand the benefit to the parties when considering a stay.These include matters such as whether parties are represented, the reasonableness and proportionality of the sanction, as well as the costs of ADR, among others.The Court of Appeal noted that "other factors too may be relevant depending on all the circumstances. It would be undesirable to provide a checklist or a score sheet for judges to operate."

This decision clearly provides robust judicial support for ADR by establishing that in principle the court may stay proceedings should parties fail to meaningfully engage in ADR. Of course, the effectiveness of ADR corresponds to the commitment of those taking part and there is always a risk in civil litigation of parties participating simply to tick a box. In such cases it can be an expensive waste of time with little hope of any sanction being imposed on the non-committed party. Such behaviour can be challenging, if not impossible, to demonstrate particularly in personal injury.

However, the current landscape lends itself to parties finding ways to work together to solve issues in a more cost effective way. The backlogs in the judicial system mean that cases are taking longer to settle and the fixed costs being introduced to most personal injury and clinical negligence claims means that most firms will be looking for ways to reach settlement quicker.  The courts have introduced schemes for small claims to be considered at a fixed fee mediation and the Churchill decision may lead towards ADR becoming compulsory in litigation after the evidence has been gathered and exchanged.

If you’d like to write an article for this newsletter, please get in touch!

EMS News for 2023

Awards

Mediation Training and Development

Over the last year EMS have rolled out 12 Civil/Commercial Mediation Training Courses, 4 Workplace Conversion Courses and 2 of the newer Workplace Mediation Training Course.  Delegates have continued to join us from around the world, including Europe, Tobago, India and Malaysia.  We have maintained our CMC approved status and have successfully passed the rigorous IMI renewal Audit.

This year’s CPD Event celebrated female mediators on International Women’s Day, with eight fantastic speakers talking about Essentially Different Areas of Mediation. 

Previously created and new courses were provided in collaboration with the marvellous Mark Wardman.  Office Culture Training continued to be provided for teams who want to improve their working environment, as was Conflict Coaching/Support for Mediation Bucks and other mediators.  Mark and EMS also developed Essential Professional Communication Skills for the University of Warwick, a pilot of 3 modules in a day, delightfully, in person.

Further collaboration was enjoyed with Jane Bryan of the University of Warwick and Deborah Cunninghame-Graham in creating Navigating Difficult Conversations Constructively.  Although applicable in many different scenarios, funding was secured to apply this training specifically to the particularly complex and unique relationship between Postgraduate students and their supervisors.

Video demonstrations were filmed for the Difficult Conversations training, with many thanks to Lucy O’Gara, who played a starring role.

Future Training 

All previous courses will continue to run throughout 2024, and we are also launching some exciting new courses!

Mediation Representation has been on the back burner for some time, but we are now ready to release this course on 22nd March.  This is particularly useful for lawyers and others who want to know how best to prepare for and represent clients in a mediation, and how to negotiate in an effective manner conducive to mediation.

We are launching a new line of training in Essential Development Solutions!  This is going to consist of a suite of courses that sit alongside our mediation provisions:

Mental Health First Aid is a brand new 2 day course which we are very excited about.  We are collaborating with Jake Morrison, a qualified and experienced Mental Health First Aid instructor, to deliver this training.  Jake is passionate about equipping people with the knowledge and skills to identify mental health issues and to have the confidence to have a conversation and signpost to support. This 2 day course will launch on Monday 29th April 2024. Email admin@emsolutions.uk for a booking form.

Conflict Management for HR and Senior Managers is going to be piloted in 2024.  This is an extremely interactive course that is tailormade for the delegates, customised during the actual training itself, so will be highly dynamic.  Suzie Prax will be the lead writer and trainer on this course, bringing with her a wealth of training experience and employment law knowledge.

If you have a course that you think would fit, let us know!

After spending some time creating processes and procedures for referrals and raising awareness of the availability and benefits of the workplace mediation service, the 3-year contract with Staffordshire County Council is under way.  Cases were slow to come in at first, but now that awareness is spreading and there is confidence in the service, cases are constantly increasing.  We are now dealing with our 10th case from them which will be conducted in the first week of the new year.  Service users and referrers have consistently given positive feedback.

Our contract with De Montfort University, also for 3-years, for workplace mediation has also now commenced.  The first such mediation has taken place and was so successful that a review has not been needed.

Previous clients continue to refer work, and new clients have been welcomed.  Cases this year have stretched from London to Glasgow!  Workplace continues to dominate with a steady flow of civil/commercial.

EMS has recently partnered with The Mediation Consultancy, who specialise in launching new mediators including creating websites and logos and all the necessary and important parts of starting a new mediation practice.  Several previous delegates have said how great this service is, so we are delighted to continue this partnership.

The Mediation Consultancy provides personal branding, digital marketing, administration and business services for independent professionals and small businesses looking to grow their dispute resolution business and build their brand. With over 25 years of experience in the dispute resolution sector, we have the necessary skills and expertise to help you make your visions a reality.

Case Study

By Lucy O’Gara, criminal lawyer

I recently trained with Emma and undertook her civil and commercial mediation course and then progressed to the workplace conversion course. I enjoyed every single second of both courses so I was very excited when I was given an opportunity to observe Emma in action doing a work place mediation.

Emma sent me the information that she had been given after being instructed and this contained some brief details about the dispute.  We then attended in person for the initial meetings with both parties which took place at their work premises.

Each meeting took around 1 hour and I found it very useful watching how Emma was able to extract information about the dispute from each person by demonstrating that she was empathetic towards each party’s position whilst also maintaining a neutral stance regarding the dispute. Emma had fantastic rapport with each party and I was able to see how this encouraged them to open up and connect with her which significantly impacted the mediation process in a positive way.

Party B had initially refused to provide an apology and I thought this might cause a stumbling block in the mediation knowing that party A had wanted to receive an apology. However due to Emma’s effective questioning in the initial meetings, party B was able to reflect on his behaviour and acknowledged that an apology would be appropriate. I thought it was fascinating that he had come to this conclusion himself despite his position at the beginning and it highlighted to me how important the questioning process is in the initial meetings.

After we finished the initial meetings, the manager spoke to Emma and I and wanted to know how the meetings had gone. Emma politely informed him that she was unable to discuss it with him due to confidentiality. Watching Emma exercise boundaries around this was extremely useful should this situation arise in any work place mediations I do.

We then attended again for the mediation and whilst the dispute resolved quite quickly, it was beneficial to watch Emma outline the process to both parties and hold space for them to share their side of the story and express their desired outcome.

It was fantastic to see that a weight had been lifted for both of them when the dispute resolved and that they could both move forward and leave everything in the past.  It also proved to me that mediation really does work!

Launching Soon! The EMS Mediator Panel

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