Mediation and arbitration after Mitchell

RCJ portrait 146x219Do mediation and arbitration hold greater appeal following the Court of Appeal ruling in Mitchell? Belinda Moore and Andrew Clarke consider the options.

The decision of the Court of Appeal in Mitchell v Newsgroup Newspapers [2013] EWCA 1537 in November 2013 caused an enormous amount of consternation amongst practitioners. 

While indicating a hardening of the attitudes of the court to compliance in the post-Jackson world, it has left much doubt and confusion in its wake and an expectation that there is likely to be a period during which there will be satellite litigation that will help define the parameters of what is and what is not acceptable to the court. Since the decision in Mitchell there has been a flurry of decisions, with significant judgments being handed down on an almost daily basis. This has been a fascinating time for those involved in civil litigation, and indeed a worrying time. No longer will the courts tolerate non compliance with orders or rules. The effect of this new world is that if you fail to comply, then your case will be struck out, practitioners may have been negligent. 

Since the Court of Appeal decision in Mitchell, the courts have become bogged down with applications from parties seeking to extend the court timetable. Whereas previously this could have been done by consent between the parties, Mitchell makes it clear that the appropriate way forward is to make an application to the court to seek permission to extend time for compliance. The result of this is that there has been a significant backlog in terms of courts being able to list applications and trials, thus causing a delay in justice being done, which appears contrary to one of the principal aims of the Jackson/MOJ reforms, namely to provide an efficient and speedy justice system.

The courts have reacted to Jackson by now allowing the parties to agree to a variation of the court timetable, by consent, and provided that no hearing date is affected (see CPR 3.8 – with effect from 5 June 2014). This development will no doubt provide a collective sigh of relief for those parties involved in court proceedings having to comply with court timetables. The zero tolerance approach created by the Court of Appeal following Mitchell has led litigants to understand that even the slightest breach of deadline, for example by missing the date for exchange of documents by as little as an hour, could risk the party being sanctioned by the court. This amendment is therefore to be welcomed, though it is set against the background of the “comply or die” regime introduced in Mitchell.

Against this background, as an alternative to proceeding through the traditional court process, parties are now considering formal arbitration or mediation as the best way forwards. The advantage of that is that it is significantly cheaper than a trial. It is much more conciliatory, and ultimately if the case does not settle, then it is all done on a without prejudice basis to any civil litigation.

Having said that, Sir Rupert Jackson made clear his distaste for any judicial compulsion to use mediation, and the Rules Committee followed that guidance. The preferred strategy was one of educating judges and others to encourage the use of mediation. He attempted to do that by structuring the costs regime in order to incentivise the use of mediation. 

While there is no specific mention of the use of ADR or mediation in the Jackson Reforms, the pre-existing CPR and judicial guidance remains in place. The basis of costs order and Part 44 remains exactly the same, with unreasonable litigation conduct, or failure to comply with protocols and court directions or orders still providing the basis for court sanctions. An unreasonable refusal to mediate pre or post issue of proceedings, therefore, it is still a potential basis for cost sanctions. Such orders were approved by the Court of Appeal in the case of Halsey v Milton Keynes NHS Trust. Therefore, nothing has changed within the existing CPR and court guidance. 

In reality there are few positive incentives for the use of mediation within the Jackson Reforms. However, given the court’s attitude to non compliance, arguably litigants will be pushed into mediation as a way of avoiding the forbidding machinery of cost management, cost budgeting and fixed costs. Ultimately they will generate much more expense for parties to comply, and indeed the parties may then be forced to attempt settlement, rather than run the gauntlet of the court process.

One positive aspect about the new world in civil litigation is that with costs budgeting and non recoverability of success fees and ATE premium, it is more likely that costs issues will no longer prevent settlement at mediation. Historically that has been a significant problem, when, in a lot of cases, the claimant’s costs exceeded the amount in issue, and led to a significant stumbling block at mediations.

For local authorities involved in litigation, mediation may be a more cost effective option, though in reality, there is little within the reforms to positively encourage it. The effect of Mitchell has retracted somewhat, in light of the “buffer” order, though potentially mediation remains a significant and cheaper option for those involved in civil litigation, rather than proceeding to court.

Belinda Moore and Andrew Clarke are partners at Weightmans LLP. Belinda can be contacted on 0116 242 8926 or This email address is being protected from spambots. You need JavaScript enabled to view it.. while Andrew can be reached on 0116 261 6422 or This email address is being protected from spambots. You need JavaScript enabled to view it..