by Ruwena Khan
Phoenix is beginning a series of articles exploring the case for introducing mandatory mediation into the civil justice system in the United Kingdom. Contributors will include practitioners, judges, policy makers and academics from the field presenting arguments for and against more compulsory forms of mediation.
Ruwena is a Legal 500 Leading Junior in Personal Injury and Clinical Negligence law. She practices from Park Square Chambers, Leeds and has been recently appointed Deputy District Judge (North Eastern Circuit, 2019)
“Conflict remains…a growth industry.”1 Technology and methods of communication, including the internet, are constantly developing. Business transactions can happen in the blink of an eye. Wealth and power are continuing to be fought over commodities. As conflicts increase, the methods by which they can be managed, if not resolved, has likewise had to develop2. As stated by Lord Dyson, MR, “Consensual settlement – whether facilitated through informal negotiation3, structured mediation…or any other such means – is an essential aspect of any civil society.”
Mediation is an increasingly used process by which parties in a dispute can seek to resolve matters and reach a negotiated settlement between themselves with the assistance of an independent/neutral third party acting as a mediator. Mediation is by nature entirely voluntary. It is a flexible, but structured process which seeks to move the parties away from engrained positions and to reach an agreed solution tailored to their real needs and interests.
The question posed above is, in some respects, simple – should mediation become mandatory, as opposed to voluntary? However, the question is wide-reaching in its scope. Mediation does not just exist as an option in legal battles in England and Wales. It reaches far beyond litigation in this country; mediation is used widely across the globe in all manner of dispute, legal and non-legal. For present purposes, whilst giving an overview of the use of mediation more generally, I intend to assess more specifically the use of mediation in litigation in England and Wales, including the advantages and disadvantages of this method of negotiating to seek resolution between wrangling parties, and whether mandatory mediation is the way forward.
Mediation is the most common method of Alternative Dispute Resolution (‘ADR’) globally. In legal disputes, its use has unsurprisingly increased to counter the staggering cost of litigation and the backlog of cases.5 ADR is now a vital component of justice systems around the globe, with an excellent success rate6.
Nearly 100 countries, in addition to various international organisations, have developed mediation laws. For example, in India the Arbitration and Mediation Act was enacted in 1996. The Arbitration and Mediation Institute was set up in Australia in 1975. In 2017, parties from 31 countries and independent territories filed mediations with the ICC International Centre for ADR.7
The EU Mediation Directive8 issued a demand for member states to build mediation into their legal systems. As a result, France set up the French Mediation Centre and the NFMC9 approved a code of ethics in March 2008 based on the European Code of Conduct for Mediators. The German Civil Code has encouraged mediation since 2002 and the EU Mediation Directive was implemented into German law in 2012 by the ‘Promotion Act’10. The Swedish Mediation Institute was formed in 199911. The list goes on.
Mediation in England and Wales
Mediation, as elsewhere, has been increasing in use in the UK. As discussed above, the cost of litigation and the backlog of cases is startling. Legal aid is restricted and the private costs of instructing law firms can be eye-watering. The cost of issuing court proceedings has recently been subject to a 620% hike and claims over £100,000 cost 5% to file subject to a cap of £10,000. “A litigant’s fragile nest egg, that they’re often forced to use to fund litigation, will therefore incur a huge dent before they even pass go.”12 Alternatives to litigation often have to be looked at as a financial necessity aside from the emotional upheaval that going to court can result in.
The Civil Procedure Rules encourage the parties to a dispute to use ADR rather than commencing proceedings. The Pre-Action Conduct and Protocols set out the steps the court would normally expect parties to take before commencing proceedings for particulars types of civil claims. The Practice Direction specifies that such steps include consideration of a form to ADR to assist with settlement. It is not mandatory. It is entirely voluntary. Nonetheless if a party, particularly one which is legally represented, fails to participate in the negotiation process and/or consider ADR, including mediation, then the consequences post-trial may be dire in terms of costs penalties.
ADR continues to be encouraged by the courts post-issue of proceedings. Standard court directions leading to trial now usually state the following:
“At all stage the parties must consider settling this litigation by any means of Alternative Dispute Resolution (including Mediation); any party not engaging in any such means proposed by another is to serve a witness statement giving reasons within 21 days of receipt of that proposal. That witness statement must not be shown to the trial judge until questions of costs arise.”
The CPR requires the court to further the overriding objective by actively managing cases13. Such active management includes “encouraging the parties to use an alternative dispute resolution procedure if the court considers that appropriate and facilitating the use of such procedure.”14 Mediation is still presently voluntary but proactively put in the forefront of the parties’ minds. This is particularly helpful for litigants-in-person who may not be aware of the alternative methods of dealing with disputes without the assistance of legal representation. The small claims online process, utilised in significant numbers by litigants-in-person, now requires the parties to confirm, when completing their Directions Questionnaires, whether they wish to participate in a mediation process which can commence over the telephone. In that way many matters do not come to court for trial. As stated by Michael Reynolds “[o]ne of the key weapons in the case management armoury of the court is a referral to a mediator.”
Voluntary Nature of Mediation
Autonomy and Control
The voluntary nature of mediation allows parties, who may otherwise have been feeling that they had not being making any headway in the ongoing dispute, to reassert some control and autonomy. It is their decision to participate in mediation. It is their choice of mediator/mediation group. The choice to be at the mediation venue on the agreed date and at the agreed time is entirely voluntary. The mediator should always remind the parties that they are in control; they are the ones who have the authority and the ability to resolve their dispute. That may not truly seem to be the picture if the parties are forced to be at a mediation.
A Positive Step Forwards
Arguing parties, who may have suffered personally and/or professionally as a result of the ongoing arguments and issues between them, when taking the step of agreeing to mediation, show a willingness to at the very least consider that some, if not all, issues could be resolved by assisted negotiation. The voluntary nature of the mediation process means that the parties can view their actions as a positive step forward. In seeing that an opposing party is willing to take that same starting step with you, it may start to knock down some barriers that had been in place.
Removing Hard Lines
It must be considered that some parties may not have met in person at any time prior to mediation and thus the, often cold, impact of arguments become even more acrimonious when simply read in black and white via written communication or when heard down the line of a telephone. Seeing your opposing party sitting voluntarily at a round table with a mediator can bring some humanity back to the issues at stake.
Every conflict has, at its core, an undeniable emotional element. If a mediator is properly utilising the ‘Principled Negotiation Method’15 then it is more likely that the parties will be prepared to reveal their genuine concerns as regards the ongoing conflict where the process is voluntary. Being part of the mediation process by choice suggests that a party is wishing to explore methods of resolving the dispute amicably. In order to do so, they are also potentially open to discussing their needs and interests with the mediator. Being forced to speak about personal matters and/or their thinking behind decisions may well leave a bitter taste when a party is not ready or prepared to mediate.
Various countries have adopted mandatory mediation. Several States in the USA have established mandatory mediation programmes, such as in California with respect to child custody and visitation. There has been compulsory mediation in Australia for many years. A large number of cases in Singapore have been subject to compulsory mediation with 95% resolving. However, mediation is not mandatory in the UK at present.
Blurring the Lines
As noted above, mediation is positively encouraged at all steps of the litigation process in England and Wales. The fact that there may be costs consequences, certainly in higher value civil claims, for failing to participate in ADR in general and to co-operate with another party, perhaps taints the pure view of ADR/mediation as being an entirely voluntary process. The Family Courts also encourage resolution prior to trial as financial remedy cases are provided with an early neutral evaluation by a judge. However, in order to be successful, it does require both parties to be willing to engage in an FDR. Mediation and early settlement cannot be forced upon a party. It is ultimately a choice to be made.
Nonetheless, in Lomax v Lomax16 the Court of Appeal confirmed that CPR r.3.1(2)(m) did not limit the court’s power to order an early neutral evaluation hearing only when the parties have agreed or consent to such a hearing. Various courts in England are now setting pilot schemes whereby matters on the small claims track, which are inundated with litigants-in-person who may be unfamiliar with the court process, are having compulsory (albeit allegedly ‘opt-out’) review hearings. Ultimately such review hearings intend to act as a quasi-mediation where the judge, as independent arbitrator will proactively seek to encourage settlement upon discussion of the issues and evidence in the case. Any party not attending such review hearing, knowing that it is with the intention of ultimately reaching settlement, may have be at risk of their case struck out. This certainly appears to be a first step in making mediation mandatory.
The obvious advantage of making mediation mandatory is that it can lead to resolution of disputes between parties who were otherwise plummeting headlong into trial. Parties may not have even considered mediation as a potential step to take in their ongoing battle. Alternatively, they may in fact have considered mediation, but simply dismissed the idea as a waste of time, cost and effort without understanding what the process does and can achieve. Forcing parties to look at mediation and go through the process of utilising a neutral third party to review their true needs and interests can be eye-opening.
Exploring new options to meet those needs and interests in a mutually beneficial way can remove much animosity and misunderstanding between the parties whether or not the matter settles at mediation or simply reduces the number of ongoing issues between them. Further, where parties continue to work together, either in business or in their personal lives, having gone through mediation can be positive in removing some ongoing conflict.
Moreover, if mediation is enforced and reaches successful conclusion, the costs of litigation are either avoided or significantly reduced. The courts can continue to reduce the backlog of cases and the justice system can keep its wheel turning.
Will mandatory mediation, however, result in an increase in mediated settlements? The answer would be, yes, if the same number of voluntary mediations also take place. There remains the question of whether mediation or any ADR will be voluntarily entered into at an earlier stage if ultimately the parties know that it will be forced upon them in the litigation process. Ontario, Canada, has a mandatory mediation programme. Within the first year of implementation there was a net gain of only 15% more settlements17 and some lawyers argue the cost is not worth such small benefit. If mediation is mandatory, then attempts at earlier settlement are hampered.18 Furthermore, if only 15% of mandatory mediations result in settlement then 85% of cases incurred the unnecessary additional cost of a further adjunct to the litigation process.
Being forced to have an independent party ask numerous, often intrusive, questions about individual and group needs, interests and concerns, can feel like a further battering process if the party is vulnerable. Some argue that mediation can be particularly harmful to women who suffer domestic violence, societal prejudices and sociological gender tendencies19, although any vulnerable individual can be harmed by a process in which self-determination is altered.
Moreover, what of those who wish to participate in the adversarial process and to have the matters in dispute resolved by an independent judge applying both the facts and the law? Being railroaded into mediation may make participants feel pressurised to concede issues and leave them dissatisfied with the legal system. There will be those who walk away from mandatory mediation, if they have reached settlement on some if not all issues, feeling they have not truly had the opportunity to have their say and access their right of ‘free’ access to the courts.
Further, not all cases merit mediation. There may be a point of law which needs determination by the court due to precedents going either way. A case may require a court to decide a wholly new legal point. The facts of the case as viewed by the parties may be so diametrically opposed that a mediator cannot assist in settlement being reached as they cannot provide opinion on the merits of a case. Such cases warrant access to a trial court.
As Lord Justice Jackson stated in his first report20:
“Professor Genn is rightly critical of a culture which seeks to drive all litigants away from the courts and into mediation, regardless of their wishes and of the circumstances of individual cases….Whilst mediation can save costs and resolve cases, in others it is inappropriate, increases costs, and, becomes just another hurdle to be crossed before the parties can get to trial.
The advantages of mediation are profound, including the saving of time, costs, emotional stress and the building of bridges. The increased encouragement and use of mediation in the litigation process by rules, courts and wider education of the process is to be welcomed. It can enlighten those who were unaware of such facilities and inspire amicable resolution of issues in a confidential manner. Although making mediation mandatory can reduce the burden placed on the legal system by the ever-increasing number of litigated cases, removing the essential element of the process being a voluntary one is too detrimental on the parties involved. Whereas mediation in general is certainly the future of disputes, mandatory mediation, in my view, is not.
- ‘Getting to Yes: negotiating an agreement without giving in’ (Fisher, Ury & Patton, 2012); pg xi
- Different methods of conflict resolution, including mediation and arbitration, have, however, been used for 1,000s of years between kingdoms and across religions e.g. Phoenicians practicing entrepreneurship and negotiations in 1200-900 B.C.
- Negotiation is an effective tool for parties able to come together to seek to reach compromise. However, one of the many issues that can prevent direct negotiation from reaching success, or even from getting off the ground in any meaningful way, is a perceived imbalance in bargaining power leading one party to feel bullied. Therein lies one of the many advantages of mediation.
- With thanks to Phoenix Dispute Solutions for many of the facts provided in this Section.
- By way of example, in Nigeria the average life-span of a case can be 10 to 15 years. In China, more than 200,000 cases remain pending. In India, each judge has an average of 2,147 cases in hand.
- In the UK 80% of cases that go to mediation result in mediated settlements.
- ‘ICC Dispute Resolution Bulletin 2018’ (Haridi and Fouret, Issue 2, pg.64)
- Directive 2008/52/EC
- National Federation of Mediation Centres
- Gesetz zur Förderung der Mediation und anderer Verfahren der außergerichtlichen Konfliktbeilegun
- The Stockholm Chamber of Commerce went on to establish the Mediation Institute of the Stockholm Chamber of Commerce with its own set of mediation rules.
- ‘Litigation Costs: How far will £10,000 get you?’ (Edmonds Marshall McMahon, website)
- CPR r.1.4(1)
- CPR r.1.4(2)(e)
- ‘Getting to Yes: negotiating an agreement without giving in’ (Fisher, Ury & Patton, 2012)
-  EWCA Civ 1467
- ‘Mandatory Mediation: A Comparative Review of How Legislatures in California and Ontario are Mandating the Peacemaking Process In Their Adversarial Systems’ (Jennifer Winestone, Feb 2015, mediate.com)
- In the 2001 Evaluation of the Ontario Mandatory Mediation Program for the Attorney General, the rate of settlement in Toronto dropped from 21.4% in the first three months of the programme to 0.3% in the last three months of 2000 (one year after the programme was introduced).
- ‘The Mediation Alternative: Process Dangers for Women’ (Trina Grillo, 100 Yale L.J. 1545,April, 1991)
- ‘Review of Civil Litigation Costs: Preliminary Report’ (London: The Stationery Office, May 2009), Vol.1, p.42, paras 2.2 and 2.4.