1.CPR 44.2(4) (Conduct)
The 2024 amendments to the Civil Procedure Rules included the following:
- In deciding what order (if any) to make about costs, the court will have regard to all the circumstances, including –
- “(e) whether a party failed to comply with an order for alternative dispute resolution or unreasonably failed to engage in alternative dispute resolution.”
This gives rise to a question: how will “engage” will be interpreted? There is ample authority for the proposition that parties who respond to an offer of ADR with silence, or by dragging their feet, are unlikely to be found to have engaged: PGF II SA v OMFS Co [2013] EWCA Civ 1288 and Thakkar v Patel [2017] EWCA Civ 117. What, however, of the party that attends an ADR session but then takes no active part? Will the court hold aside the contractual confidentiality provisions usually found in an agreement to mediate (or for neutral evaluation) and consider whether that party has “unreasonably failed to engage”? In EAXB v University Hospitals of Leicester NHS Trust (unreported) the court considered the conduct of a defendant during a joint settlement meeting. The defendant instigated the meeting but then took the position that it had no offers to make. The claimant successfully argued that such an approach was entirely inappropriate, and this was one of the reasons why the claimant secured indemnity costs. See https://www.kingschambers.com/case/satinder-hunjan-qc-successful-in-establishing-liability-and-securing-indemnity-costs-for-downs-syndrome-arising-out-of-a-failure-for-organising-urgent-appointments-for-a-combined-test/
2. The Appiah case
The case concerned an action by a claimant (C) against a defendant and an NHS Trust (D2). This case preceded the CPR amendment referred to above but nevertheless gives a useful insight into what is meant by engaging with ADR.
Order: C and D2 were ordered by the court to consider ADR. The order added and “…. any party not engaging in any proposed ADRmust serve a witness statement giving reasons within 21 days of receipt of that proposal.”
Exchange of communications between C and D2:
C: Proposed ADR.
D2:
- We are prepared to engage.
- What form of ADR?
- We need to consider your expert evidence first.
C: Mediation is the proposed form.
The court considered this exchange and held that D2 had not engaged in the ADR proposed by C and so was in breach of the order:
“D2 did not begin to engage in ADR within 21 days of Cs’ proposal; they expressly stated that their view was that expert evidence should be served first.”
That D had not refused to engage was beside the point.
Outcome: D was ordered to provide a witness statement explaining its position and all parties were ordered to reconsider mediation.
Conclusion: Parties must not only consider mediation but actively engage with it. Should a party not engage they may consider that the only safe course is to provide contemporaneous, explicit written reasons for not doing so. As mentioned above, remaining silent or “foot-dragging” are unlikely to be interpreted as “engaging” with ADR.
Citation: Appiah v Leeds City Council & Anor [2025] EWHC 1537 (KB)
3. Query: Could D2 in Appiah have avoided the problem by serving a witness statement saying they wanted to see the expert evidence? Possibly, but possibly not:
In PGF II SA v OMFS Co [2012] EWHC 83 (TCC), [2012] 3 Costs LO 404, para 45.1, the court held that:
” ….. (awaiting) information which was required to evaluate the claim either by way of disclosure or from expert reports” was not a legitimate reason “…. in this case to refuse to mediate.”
Essentially, the court was saying that you do not need an “oven-ready” trial bundle to settle a case. This point is under-scored by the fact that over 50% of TM’s mediations are conducted pre-proceedings (with the same settlement rate as post proceedings).
The court put it this way:
“Either parties know or are prepared to assume that certain facts will be established or, during the course of a mediation, such information is made available, often on a without prejudice basis. (The saving of costs is achieved or attempted) by the parties being prepared to compromise without necessarily having as complete a picture of the other parties’ case as would be available at trial. It might well be a legitimate reason for postponing a mediation if essential information was requested and refused,”
So, if you are saying “Yes, we will mediate – but later” that, on its own, is not good enough. You need to give explicit reasons relating to the circumstances of the claim, in writing, at the time of refusal, and these must be consistent with the continually developing case law. Bare assertions (“not appropriate at this stage”) run the risk of being rejected. Careful drafting is essential.
With careful drafting and good reasons, the costs risk can be avoided, or at least mitigated, as the following cases show:
- In CIP Properties (AIPT) Ltd v Galliford Try Infrastructure Ltd [2014] EWHC 3546 (TCC), [2014] 6 Costs LR 1026, a construction case, the TCC did envisage that mediation should be delayed until after disclosure.
- Similarly, in Ivey v Lythgoe [2025] EWHC 2325 (Ch), which concerned a professional negligence case, the court ordered mediation but also ordered that Particulars of Claim be served in good time (4 weeks) before the mediation, so that the other party knew the case it had to meet.
- Finally, in Ellis v Ellis & Ors (Re: Care (Decd)) [2025] EWHC 2609 (Ch), the judge found that:
“…it was perfectly reasonable for (Party 1) to wait until after the CCMC to consider whether mediation was appropriate at that stage. This is particularly so because (Party 3) had refused to disclose the evidence in support of his case, and in circumstances that he was uniquely positioned to know the evidence he had available in support of his (claim).”
The Court also rejected a submission that a delay in mediation had made settlement less likely.
For further updates on ADR case law and procedure, see https://www.trustmediation.org.uk/adr-champion/
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