Another step closer to compulsory mediation?

The recent judgment handed down in Churchill v Merthyr Tydfil County Borough Council confirmed that the court can order parties to engage in “non-court-based dispute resolution” (such as mediation, arbitration, or conciliation which is often referred to as Alternative Dispute Resolution or ‘ADR’ for short) or order a stay in proceedings for it to take place.

Churchill v Merthyr Tydfil County Borough Council – a brief summary

A seemingly basic dispute existed between Mr Churchill and his local council; Mr Churchill alleged that Japanese Knotweed had encroached onto his property from neighbouring property owned by the council. Mr Churchill issued a nuisance claim in the summer of 2021 (after refusing to engage in the council’s complaints procedure), and the council subsequently applied for a stay the following winter so that the procedure could be followed.

At this stage, the court was forced to consider whether it had the power to order a stay in proceedings to allow for parties to engage in ADR. The key issue for the court to grapple with was whether they could order a stay in proceedings or order parties to engage in ADR, and if so, what the relevant principles and criteria were for doing so.

The court held that it could stay proceedings for ADR but declined to provide any guidance in terms of when and at what stage is most appropriate to make such an order, and emphasis was placed on the need for matters to be considered on a case-by-case basis.

Impact of Churchill v Merthyr Tydfil County Borough Council

Though at first glance the impact of this case might seem significant, in practice this may not be so. The decision hasn't gone so far as to make out-of-court dispute resolution (or ADR) compulsory in every case (though this is becoming more prevalent in other jurisdictions; in New Zealand, mediation is compulsory in every dispute existing between trustees and beneficiaries). In some ways, Churchill simply brings the UK jurisdiction slightly more in line with others and it's hoped that the court is pragmatic in its approach.

There are some positive effects from Churchill:

  • It confirms that mediation and other non-court dispute resolution methods are recognised as effective, viable and desirable options for parties wishing to achieve a satisfactory outcome without costly and lengthy court proceedings. It provides a confidential forum in which clients can account for emotional value, which can be especially pertinent in the landscape of estate, trust and will disputes, and this may help in preserving family/professional relations.
  • Parties will have to consider mediation from an early stage - this might instigate early conversations to happen that may not have otherwise occurred.   
  • A Court may order a stay for ADR and this may have the impact of making previously unwilling parties more inclined to participate and engage in the process. 
  • There's no requirement for parties to resolve their disputes through ADR, and they still have the right to have their matter heard at trial, but this decision may at least help the parties focus their minds and even narrow the issues between them.

That said:

  • In some matters, going to trial is crucial, for example due to costs orders, reputation, concerns regarding lack of disclosure, or where the only satisfactory outcome can be reached at trial. In others, one party might hold a strong belief in their position or simply refuse to engage with the other party. In such scenarios, mediation will prove fruitless; it's hoped that the court will consider these factors.
  • An issue of practicality may also appear with the increasing volume of cases requiring mediators. The relatively few mediators may face strain, and therefore this is something to be mindful of in terms of timescales and the practicability of referring more cases to mediation.
  • In practice, the disputes (and parties) which are suited to mediation, often do mediate. Forcing unwilling parties to mediate without good faith, nor the desire to engage, may simply result in further wasted time and costs (the phrase ‘you can lead a horse to water...but you can’t make it drink’ comes to mind). In such circumstances where the mediation fails, the court will have to dedicate time at trial to address a party’s refusal to mediate or their lack of good faith, which could incur additional time and costs.

Overall, we're pleased to see that there's a positive shift in the direction of ADR – in our experience it's extremely effective in resolving estate, trusts and will disputes but we must remember that it isn’t the magic solution (or appropriate) in every case.

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Every piece of content we create is correct on the date it’s published but please don’t rely on it as legal advice. If you’d like to speak to us about your own legal requirements, please contact one of our expert lawyers.

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