The Civil Procedure Rules have been amended to give the courts the authority to order the parties in disputes to engage in alternative dispute resolution (ADR). The main types of ADR in litigation are mediation, arbitration and negotiation.
In this article, we highlight the dramatic changes, explore why they have been made and consider what this means for disputes involving trusts and estates.
Broadly, this change to the Civil Procedure Rules has been made as a result of the decision of the Court of Appeal in the recent case of Churchill v Merthyr Tydfil County Borough Council. The Court of Appeal held that the court had a discretionary power to order a ‘stay’ in proceedings and compel the parties to engage in a non-court-based dispute resolution process such as mediation.
The previous approach had been at most for the court to order a stay so that the parties had an opportunity to try ADR. The decision in that case supported the principle that litigation should be a means of last resort, and it emphasised the courts’ determination to enforce this upon parties to disputes.
The relevant changes to the Civil Procedure Rules are as follows:
To view the up to date Civil Procedure Rules in full, please click here.
The Civil Procedure Rules do not provide guidance on the type of circumstances where the court may exercise its new powers. Whilst that might seem unusual, that was the Court of Appeal’s approach in the Churchill v Merthyr Tydfil County Borough Council case where it was unwilling to lay out what specific factors must be considered when considering ordering a stay in proceedings for non-court-based dispute resolution. The court concluded that it was for the judge in each case to decide what factors may be relevant.
There is therefore no checklist or scoresheet for judges to operate.
It's too early to determine the effect that the changes to the Civil Procedure Rules will have on disputes involving trusts and estates. We do however expect to see a further increase in mediations taking place before claims are issued or shortly after they are started, rather than later on in the process.
It's likely that at the first directions hearing or case management conference, the courts will press for assurance that parties have in mind the options for ADR, and they may order it if they believe a party in unreasonably refusing to engage. It's likely that the courts will revisit the question again at subsequent junctures throughout the proceedings.
The parties to these types of disputes should always be mindful of ADR at all stages of the litigation in any case. Litigation can be financially ruinous so exploration of ADR is something that parties should always consider, and keep under consideration throughout proceedings.
For more information on any of the issues raised in this article, please contact David Tomlin and Sasha Wicks from our wills and inheritance disputes team.
