Can the court lawfully stay proceedings for, or order, the parties to engage in non-court-based, alternative dispute resolution (“ADR”)?
Yes, said the Master of the Rolls, with whom the Lady Chief Justice and Birss LJ agreed.
This an important judgment for dispute resolution practitioners. Interveners included (“the Interveners”), but were not limited to: the Law Society; the Bar Society; the Civil Mediation Council; the Centre for Effective Dispute Resolution; and the Chartered Institute of Arbitrators.
Facts
The Respondent, Mr Churchill bought a property. The Appellant council (“the Council”) owned adjoining land. The Respondent claimed that Japanese knotweed encroached from the Appellant’s land onto his property, causing loss of enjoyment, damage and a reduction in value.
Procedural history
The Respondent, Mr Churchill issued proceedings. The Appellant applied for a stay because its complaints procedure had not been used (“the Application”).
At first instance, the Application was dismissed. The court felt bound by what Dyson LJ (as he then was) said in Halsey v Milton Keynes General NHS Trust [2004] EWCA Civ 576, [2004] 1 WLR 3002 at [9] (“Halsey”) that “to oblige truly unwilling parties to refer their disputes to mediation would be to impose an unacceptable obstruction on their right of access to the court.”
The Council was granted permission to appeal. It was then referred to the Court of Appeal. There was an important point of principle and practice and many other, similar cases.
Issues
There were three, real issues.
The fourth was not properly raised.
First, was Halsey binding and the Application doomed to be dismissed? Secondly, was the court able to stay proceedings for, or order, the parties to engage in ADR? Thirdly, if so, what are the relevant principles?
Issue one: Was Halsey binding?
In legal terms, was the sentence of Dyson’s LJ quoted above ratio decidendi? In layman’s terms, was it “part of the best or preferred justification for the conclusion” that was reached in Halsey? In either, the answer was: “No”.
Issue two: Can the court stay proceedings for, or order, parties to engage in ADR?
Mr Churchill had three submissions against such a power.
First, his right to bring and progress proceedings could not be impeded by a requirement to pursue an internal complaints procedure that was not designed to address his cause of action.
Secondly, any impediment required a secure, statutory footing that was absent.
Thirdly, any statutory impediment could only authorise a degree of intrusion that was reasonably necessary to fulfil its objective.
The Council and the Interveners submitted that a power existed subject to three criteria.
First, it did not impair the very essence of the right to a fair trial. Secondly, it was pursuant to a legitimate aim. Thirdly, it was proportionate to achieving that aim.
It was held that the relevant authorities “largely coincide” from within the jurisdiction, the European Court of Human Rights and the Court of Justice of the European Union.
Yes, the court can stay proceedings for, or order, parties to engage in ADR.
No, the impediment did not require a secure, statutory footing.
Issue three: What are the relevant principles?
To order or facilitate any particular method of ADR is a matter for the court’s discretion.
What principles are relevant to the exercise of this discretion?
In no particular order, a non-exhaustive list was issued.
First, the particular method (merits and demerits) of ADR being considered. Secondly, it must not impair the very essence of the right to a judicial hearing. Thirdly, it must be proportionate to achieving the legitimate aim of settling the dispute, fairly, quickly and at reasonable cost.
Exhaustive principles cannot, and should not, be laid down.
Disposal
In part, the appeal was allowed.
The fourth issue was not properly raised. Accordingly, it was dismissed.
Written by Dominic Bright