Refusal to mediate - the consequences.

Here is a round up of case law where refusal to mediate or engage in ADR has been punished by the courts on the question of costs. At the moment, Concentus is hearing that some parties are using the current climate as a reason not to engage in ADR. For example many are refusing to mediate remotely during the pandemic. This could have serious costs consequences and mediating remotely should not be refused lightly. 
 
Halsey v Milton Keynes General NHS Trust [2004] EWCA Civ 576 is well established case law establishing the principle that the court can sanction a party for failure to consider ADR. This hasn’t always been applied. 
 

However, how have the courts been applying this in 2020? There are three noteworthy cases worth a mention. 

In Wales (t/a Selective Investment Services) v CBRE Managed Services Ltd & Anor [2020] EWHC 1050 (Comm) the court ordered costs sanctions against the successful party as a result of unreasonable refusal to mediate. 

In BXB v (1)Watch Tower and Bible Tract Society Of Pennsylvannia and (2) Trustees of the Barry Congregation of Jehovah's Witnesses [2020] EWHC 656 (QB), the court awarded indemnity costs for unreasonable failure to engage in ADR. 

Finally in the case of DSN v Blackpool Football Club Ltd (Rev 1) [2020] EWHC 670 (QB), indemnity costs were ordered for failure to engage in ADR at all. The refusing party repeatedly stated that it “continue[d] to believe that it [had] a strong defence”.  The judge found that “No defence, however strong, by itself justifies a failure to engage in any kind of alternative dispute resolution.”
 
Real thought has to be given to this judgment when refusing to mediate online or in person. Failing to engage in any kind of ADR may be reprehensible resulting in a punishment on costs. Parties must be wary when taking this approach.  
 
If parties are concerned about remote mediation, then discuss this with a mediator, find out how it works, why it works and consider it as an option that could resolve a dispute.