MEDIATION IN THE COURT OF APPEAL
The Court of Appeal can recommend that appeals be referred to mediation. This blog looks at the process and some of the case law.
A Lord/Lady Justice considering an application for permission to appeal is expressly required to consider whether the matter is suitable for mediation
If so, the Head of the Civil Appeals Office will send details of the case to CEDR, who will write directly to the parties seeking agreement to arrange a mediation hearing The full Court may also propose mediation where there are outstanding issues and a possibility of further litigation
The general guidance can be found at http://www.justice.gov.uk/courts/rcj-rolls-building/court-of-appeal/civil-division/mediation
The mediation need not take place in London and the venue can be arranged to suit the convenience of the parties.
GUIDANCE FROM THE COURT OF APPEAL ITSELF
The most trenchant recent observations in relation to the scheme come from the
Court of Appeal itself in Gaith –v- Indesit  EWCA Civ 642. The Court of
Appeal allowed an appeal in a fairly low value personal injury case. Longmore LJ
26. It is a great pity that Indesit did not pursue the option of mediation rightly encouraged by Toulson LJ when he gave permission to appeal. Mr Peebles informed us that it was not pursued because the costs had already exceeded the likely amount in issue. This is an inadequate response to this Court’s encouragement of mediation since a full day in this Court will inevitably result in a substantial increase in costs. Indesit’s reaction is all too frequent and the Court has, since April of this year, decided that any claim for less than £100,000 will be the subject of compulsory mediation. It is devoutly to be hoped that such mediation will mean that these comparatively small claims will not have to be adjudicated by this Court so frequently in future.
Lord Justice Ward:
29. I fully endorse Longmore LJ’s postscript. When this Court grants permission to appeal, it does so because there is a real prospect of success. That does not mean that the appeal will succeed, but it does mean that the appeal is by no means hopeless. That should tell both parties that there is still all to play for. If they have any sense, they will therefore heed a recommendation to mediate because the costs of mediation are likely to be exceeded by the costs of the appeal by a significant margin. It is not enough, as Mr Peebles suggested, that there had been some attempt in the correspondence between solicitors to settle the case. The opening bids in a mediation are likely to remain as belligerently far apart as they were in correspondence but no-one should underestimate the new dynamic that an experienced mediator brings to the round table. He has a canny knack of transforming the intractable into the possible.
That is the art of good mediation and that is why mediation should not
be spurned when it is offered.”
|In Faidi –v- Elliot  EWCA Civ 287|
Jackson LJ, giving judgment in a neighbour dispute, stated:
- I agree that this appeal should be dismissed for the reasons stated by Lloyd LJ. I wish to add a comment about the manner in which the litigation has been conducted.
- This case concerns a dispute between neighbours, which should have been capable of sensible resolution without recourse to the courts. During the course of his submissions in the Court of Appeal Mr Pearce for the claimants observed that this may not be an “all or nothing” case. A moderate degree of carpeting in flat 8 might (a) reduce the noise penetrating into flat 6 and (b) still enable the occupants of flat 8 to enjoy their new wooden floor. This is precisely the sort of outcome which a skilled mediator could achieve, but which the court will not impose.
- Of course there are many cases where a strict determination of rights and liabilities is what the parties require. The courts stand ready to deliver such a service to litigants and must do so as expeditiously and economically as practicable. But before embarking upon full blooded adversarial litigation parties should first explore the possibility of settlement. In neighbour disputes of the kind now before the court (and of which I have seen many similar examples) if negotiation fails, mediation is the obvious and constructive way forward.
- In the present case a mediator would not have been concerned about the interaction between the various leases and the licence to carry out works. Nor would he have been concerned about the other interesting points of construction, which first the county court judge and now this court have been called upon to decide. Instead he would have been helping the parties to find a sensible resolution of the practical problem which had arisen. I have little doubt that such a mediation would have been successful. The points of law upon which the litigation has turned are not easy ones and at the time of the hypothetical mediation neither party could have been confident of victory.
- As it is, neither side wrote to the other proposing mediation until shortly before the hearing in the Court of Appeal. By then huge costs had been incurred. The claimants’ costs up to the end of trial were £23,195. The claimants incurred a further £34,609 costs on the appeal. The defendant’s costs up to the end of trial were £32,798. The defendant incurred a further £49,532 costs on the appeal. Thus the total costs thrown away amount to £140,134. If the parties were driven by concern for the well being of lawyers, they could have given half that sum to the Solicitors Benevolent Association and then resolved their dispute for a modest fraction of the monies left over.”
Ward LJ stated:
I wish enthusiastically to associate myself with the observations of my Lords on the desirability of mediation in neighbourhood disputes. To repeat what I recently said in Oliver v Symons, a boundary dispute:
“I wish particularly to associate myself with Elias L.J.’s pointing out that this is a case crying out for mediation. All disputes between neighbours arouse deep passions and entrenched positions are taken as the parties stand upon their rights seemingly blissfully unaware or unconcerned that they are committing themselves to unremitting litigation which will leave them bruised by the experience and very much the poorer, win or lose. It depresses me that solicitors cannot at the very first interview persuade their clients to put their faith in the hands of an experienced mediator, a dispassionate third party, to guide them to a fair and sensible compromise of an unseemly battle which will otherwise blight their lives for months and months to come.”
- Not all neighbours are from hell. They may simply occupy the land of bigotry. There may be no escape from hell but the boundaries of bigotry can with tact be changed by the cutting edge of reasonableness skilfully applied by a trained mediator. Give and take is often better than all or nothing.
DUNNETT –V- RAILTRACK
In fact this recommendation to mediate goes back over a decade. In Dunnett –v- Railtrack PLC  EWCA Civ 203 the Court of Appeal dismissed an appeal by a claimant whose horses had been killed due to the alleged negligence of Railtrack. Despite dismissing the appeal the Court refused to give Railtrack the costs of the appeal. Brooke LJ stated.
- It appears to me that this was a case in which, at any rate before the trial, a real effort should have been made by way of alternative dispute resolution to see if the matter could be satisfactorily resolved by an experienced mediator, without the parties having to incur the no doubt heavy legal costs of contesting the matter at trial. There is no evidence that this was ever suggested by the court. I say nothing more about that except to say that it is understandable, in these circumstances, that passions may have been running fairly high.
- However, the time did come when this court in terms suggested that this was a case for alternative dispute resolution. CPR 1.4 reads:
“(1)The court must further the overriding objective by actively managing cases.
(2)Active case management includes-
(e)encouraging the parties to use an alternative dispute resolution procedure if the court considers that appropriate and facilitating the use of such procedure.”
- In the helpful notes to that rule in the Autumn 2001 edition of the White Book Service 2001, the editors write on page 18:
“The encouragement and facilitating of ADR by the court is an aspect of active case management which in turn is an aspect of achieving the overriding objective. The parties have a duty to help the court in furthering that objective and, therefore, they have a duty to consider seriously the possibility of ADR procedures being utilised for the purpose of resolving their claim or particular issues within it when encouraged by the court to do so. The discharge of the parties’ duty in this respect may be relevant to the question of costs because, when exercising its discretion as to costs, the court must have regard to all the circumstances, including the conduct of all the parties (r.44.3(4), see r.44.5).”
- The value of that observation is that it draws attention to the fact that the parties themselves have a duty to further the overriding objective. That is said in terms in CPR 1.3. What is set out in CPR 1.4 is the duty of the court to further the overriding objective by active case management, which includes the feature to which I have referred.
- Mr Lord, when asked by the court why his clients were not willing to contemplate alternative dispute resolution, said that this would necessarily involve the payment of money, which his clients were not willing to contemplate, over and above what they had already offered. This appears to be a misunderstanding of the purpose of alternative dispute resolution. Skilled mediators are now able to achieve results satisfactory to both parties in many cases which are quite beyond the power of lawyers and courts to achieve. This court has knowledge of cases where intense feelings have arisen, for instance in relation to clinical negligence claims. But when the parties are brought together on neutral soil with a skilled mediator to help them resolve their differences, it may very well be that the mediator is able to achieve a result by which the parties shake hands at the end and feel that they have gone away having settled the dispute on terms with which they are happy to live. A mediator may be able to provide solutions which are beyond the powers of the court to provide. Occasions are known to the court in claims against the police, which can give rise to as much passion as a claim of this kind where a claimant’s precious horses are killed on a railway line, by which an apology from a very senior police officer is all that the claimant is really seeking and the money side of the matter falls away.
- It is to be hoped that any publicity given to this part of the judgment of the court will draw the attention of lawyers to their duties to further the overriding objective in the way that is set out in Part 1 of the Rules and to the possibility that, if they turn down out of hand the chance of alternative dispute resolution when suggested by the court, as happened on this occasion, they may have to face uncomfortable costs consequence.
- In my judgment, in the particular circumstances of this case, given the refusal of the defendants to contemplate alternative dispute resolution at a stage before the costs of this appeal started to flow, I do not think that it is appropriate to take into account the offers that were made. In my judgment, taking into account all the circumstances of the case, as we are bound to do under CPR Part 44, which applies as much to the Court of Appeal as it does to courts at first instance, the appropriate order on the appeal is no order as to costs.
CRITICS OF THE SCHEME
It is true to say that there are critics of the scheme, see http://kerryunderwood.wordpress.com/2013/03/15/mediation-in-the-court-of-appeal-a-bad-thing/
It would be interesting to see if the mediation is being monitored for effectiveness. I have had one experience of using the scheme and the mediation did indeed lead to an apparently intractable case settling.
Discussion of the Scheme and relevant cases which criticise the failure to mediate can be found at
LINKS TO CASES
The Dunnett decision on costs is at http://www.bailii.org/cgi-bin/markup.cgi?doc=/ew/cases/EWCA/Civ/2002/303.html&query=dunnett+and+railtrack&method=boolean
The Dunnett decision on liability is at http://www.bailii.org/cgi-bin/markup.cgi?doc=/ew/cases/EWCA/Civ/2002/302.html&query=dunnett+and+railtrack&method=boolean