Proposed changes to the rules on ADR

We reported at the end of last year on the Court of Appeal decision in James Churchill v Merthyr Tydfil County Borough Council [2023] EWCA CN1416.

The Court ruled that the courts can stay proceedings to order parties in dispute to engage in ADR, including mediation so effectively opening the gate to introducing mandatory ADR more widely including in more complex cases. That ruling overturned what had been accepted, for nearly 20 years, as a general prohibition on the English courts to compel ADR based on Halsey v Milton Keynes General NHS Trust [2004] EWCA Civ 576.

In the wake of the Churchill v Merthyr Tydfil decision, the Civil Procedure Rule Committee announced in April a consultation on ADR and proposed rule changes. The main changes are:

CPR1.1 -this adds to the overriding objective that dealing with a case justly and at proportionate cost includes, so far as is practicable, using and promoting ADR.
CPR1.4 and 3.1 - these are revised to clarify that the court's general case management duties and powers include not just encouraging but ordering parties to participate in ADR.
Part 28 (fast/intermediate track) and 29 (multi track) - the suggested revisions require the court to consider whether to order or encourage parties to participate in ADR for fast-track, intermediate track and multi-track claims.
Part 44 - this is revised so that when the court is exercising its general costs discretion, the court will look at the conduct of the parties and will have regard to whether a party failed to comply with an order for ADR or unreasonably failed to participate in ADR proposed by another party.

So what do these proposed changes mean in practice?

The proposed changes reflect the court's power to order ADR following the judgment of the Court of Appeal. This is consistent with that decision where the court declined to set down any checklist or specific principles for judges when deciding whether to order ADR. This means the issue of whether ADR is ordered remains discretionary and we will probably see the principles to be applied develop through case law. It also means that in highly complex litigation, the court will not see itself as being compelled to order ADR unless it thinks it is appropriate, so we do not currently foresee a huge change in approach in the more complex cases.

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