A senior mediation specialist at a leading law firm says ways of settling legal disputes without going to court have been given a major boost by two new developments.
Tim Jones, head of the employment team at Higgs & Sons, says the profile and legal standing of Mediation and Alternative Dispute Resolution (ADR) has been strengthened by an important Court of Appeal ruling and the launch of a new business initiative.
ADR has been developed over the last 30 years as a way of settling disputes without the need for litigation. It uses mediation, negotiation and non-adversarial processes to try to resolve differences.
Tim said a ruling by Lord Justice Briggs in PGF II SA v OMFS Company 1 Limited showed the court’s unequivocal support for ADR – and the perils facing companies which simply ignored offers to take part in it.
The case centred around three dilapidations claims brought by landlord PGF against its tenant, OMFS. Although both parties made a number of part 36 offers to settle during the proceedings, OMFS twice failed to respond to an offer by PGF to take part in mediation.
The case was settled on the basis of one of the offers the day before it was due to go to court, but PGF then asked that it should not be liable for OMFS’s costs – as it ordinarily would – because OMFS’s failure to respond to mediation requests was unreasonable.
Tim said PGF had won its initial case over costs and this was then upheld in the Court of Appeal.
“This ruling is an important step in consolidating the importance of ADR in law,” said Tim.
“Lord Justice Briggs himself said that the court was now endorsing the view that failing to respond to an invitation to take part in ADR was, as a general rule, unreasonable.
“His lordship also highlighted research which shows just how effective mediation can be in settling disputes and the very real benefits in terms of costs which ADR can achieve for those using it. This is a clear endorsement of the role that ADR can play in resolving such disputes and a stark warning to companies which refuse to acknowledge an invitation to take part that they do so at their peril.”
Tim said ADR had also received the backing of five of the country’s biggest companies, who had pledged to use it to solve their own disputes.
The ADR Pledge – launched by the Centre for Effective Dispute Resolution and International Institute for Conflict Prevention and Resolution on November 12 – has already been signed by Marks & Spencer, The Royal Institute of Chartered Surveyors, Tesco, TNT Post and Virgin Media.
Signatories promise to use ADR wherever possible to solve their disputes instead of taking court action.
Tim said: “It is clear from the scale of companies supporting this pledge that ADR is now seen by the business community as a real, sustainable alternative to court action, and offers clear benefits to any companies which use it.
“I would urge any company to seriously consider the benefits ADR can bring them, both in terms of solving disputes and cutting legal costs.”
Higgs & Sons works from two offices in the Black Country – Waterfront Business Park in Brierley Hill and Kingswinford. The firm employs more than 200 people, which includes over 100 specialist lawyers.
For specialist advice for your business relating to employment issues and ADR, contact Tim on 0845 111 5050 or email Tim.firstname.lastname@example.org