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“Practice Direction –
Protocol”
This
Practice Direction (click
here to read the Protocol
in full) applies to the
pre-action protocols which have been approved by the
Head of Civil Justice. So, for example, it applies
(Paragraph 1.1) to the Construction and Engineering
Disputes Protocol. It has always been a requirement
(Paragraph 4.3(f)) that the Claimant’s Pre-Action
Protocol Letter should state that the Claimant
wishes to enter into mediation (or some other form
of ADR). However, Paragraph 4.7 has been re-written
as follows:
“The
parties should consider whether some form of
alternative dispute resolution procedure would be
more suitable than litigation, and if so, endeavour
to agree which form to adopt. Both the Claimant and
Defendant may be required by the Court to provide
evidence that alternative means of resolving their
dispute were considered. The Courts take the view
that litigation should be a last resort, and that
claims should not be issued prematurely when a
settlement is still actively being explored. Parties
are warned that if the protocol is not followed
(including this paragraph) then the Court must have
regard to such conduct when determining costs.
It is
not practicable in this protocol to address in
detail how the parties might decide which method to
adopt to resolve their particular dispute. However,
summarised below are some of the options for
resolving disputes without litigation:·
-
Discussion and negotiation.
-
Early neutral evaluation by an independent third
party (for example, a lawyer experienced in that
field or an individual experienced in the
subject matter of the claim).
-
Mediation – a form of facilitated negotiation
assisted by an independent neutral party.”
Court of Appeal Cases
In Dr SR Burne
–v- “A” [2006] EWCA Civ 24 (click
here for the full
judgment), the Court was concerned with allegations
of professional negligence against a Doctor, who is
a GP. “A” had suffered a heart attack and brain
damage when he was under 7 years of age as a result
of a blockage in a ventriculo-peritoneal shunt (a
device that continuously drains fluid from the brain
cavity) that had been fitted when he was 9 weeks
old. The Judge at first instance had put the agreed
expert evidence as to diagnosis over the telephone
using open questions on one side and found for “A”.
The Court of Appeal ordered a re-trial but Lord
Justice Sedley, in giving the judgment of the Court,
said:
“I do, however, feel very
strongly that this is a case which must be referred
to alternative dispute resolution before it is
restored for the re-trial. Both parties should take
stock of the strengths but also the weaknesses of
their respective cases which are now plain for all
to see and I hope mediation will bring a swift
conclusion to a tragic event.”
In
IDA Limited and
Others –v- University of Southampton and Others
[2006] EWCA Civ 145 (click
here for the full
judgment), the Court was concerned with costly
litigation over who owned a patent. In allowing the
appeal, Lord Justice Jacob, in giving the decision
of the Court, said:
“Parties to these
disputes should realise, that if fully fought, they
can be protracted, very, very expensive and
emotionally draining. On top of that, very often
development or exploitation of the invention under
dispute will be stultified by the dead hand of
unresolved litigation. That may be the case here:
there has not yet been any exploitation by either
side, some 8 years after the original PCT
application. It will often be better to settle early
for a smaller share than you think you are entitled
to – a small share of large exploitation is better
than a large share of none or little.
This sort of
dispute is particularly apt for early mediation.
Such mediation could well go beyond conventional
mediation (where the mediator facilitates a
consensual agreement). I have in mind the process
called "med-arb" where a "mediator" trusted by both
sides is given the authority to decide the terms of
a binding settlement agreement. Such a power
in effect already exists in the Comptroller once he
has found a case of entitlement (see s.8(2)). But by
then it will probably be far too late.”
Although the Judge
referred to “med-arb”, it might be said that
“arb-med” might be more suitable in such situations.
It avoids the potential difficulties as to how a
mediator deals with information that he has gleaned
from a mediation when he comes to give an
arbitration award. Arb-med can be set up so that the
arbitration award is put in an envelope on terms
that it is not to be opened unless and until the
subsequent mediation fails to produce an agreed
settlement. |
