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Category Archives: Case Law

Police penalised for failing to mediate

The police have become the latest litigants to fall foul of the increasing willingness of the courts to apply costs sanctions against parties who unreasonably refuse to mediate.

In Laporte v The Commissioner of Police for the Metropolis the police successfully defended a claim. They asked the court for costs to be assessed in their favour on the indemnity basis and for a payment on account of £100,000 to be awarded. Instead Turner J in the High Court said:

I am satisfied that the defendant’s failure fully and adequately to engage in the ADR process should be reflected in the costs order I make…

I do not consider that the scale of the defendant’s shortcomings in the context of his failure to engage with ADR was such as to justify disentitling him from claiming any of his costs. He did ultimately win on every substantive issue and, although ADR made settlement a sufficiently likely possibility, it would have been by no means certain. Exercising the broad discretion afforded to me by the rules, I award the defendant two thirds of his costs against the claimants to be assessed on the standard basis.

The judge went through the six Halsey reasons commonly cited as grounds for reasonably refusing to mediate and discounted each in turn on the facts of the case. On the question of whether or not ADR would have been successful the judge said parties should not regard “tactical positioning” as intransigence. In other words parties frequently make statements or proposals with the aim of lowering the expectations of the other side. This does not necessarily represent the parties’ true position and is not grounds for saying a settlement is not possible so mediation is bound to fail.

This is the latest case in a recent line which has seen parties penalised for failing to adequately engage in ADR. You can download a copy of our case digest on ADR costs penalty cases here.

When “without prejudice” may not apply.

In Avonwick Holdings Ltd v Webinvest Ltd the Chancery Division considered the use of ‘without prejudice’ as a topper for letters and emails. The case concerned draft heads of terms over the restructuring of the defendant’s obligations under a loan agreement after Webinvest had defaulted on a debt due. Avonwick’s solicitor started marking correspondence betweenContinue Reading

Cast iron case no reason to refuse mediation

Mr Justice Ramsey has backed the transformative power of mediation to resolve commercial disputes by finding that BAE was unreasonable in refusing to mediate, even though it reasonably believed that it had a strong case.  However, the Defendant’s failure to accept an offer which it did not beat was also unreasonable, so it was aContinue Reading

Unreasonable refusal to mediate

An unreasonable refusal to mediate will be punished by a costs sanction. This was re-affirmed by the Court of Appeal last year in the case of PGF II SA v OMFS Company Limited. The High Court has recently awarded indemnity costs against a defendant that persistently refused to mediate. In Garritt-Critchley v Andrew Ronnan andContinue Reading

Court warns lawyers to comply with rules.

Compliance with the CPR rules is going to be strictly enforced, and those who fail to comply will be punished. So says the Court of Appeal in the infamous “Plebgate” case of Andrew Mitchell v News Group Newspapers Limited. The case was a defamation claim regarding the Sun’s publication of allegations about Mr Mitchell’s behaviourContinue Reading

Mediation Settlement Agreements

Who should draw up a settlement agreement and what terms should it contain? Parties advising litigants need to take care, particularly if the settlement involves property and/or shares, because of the formalities required for transfer and the potential tax implications.  The mediator also needs to be aware if they help the parties to draw upContinue Reading

Divorce can be painful.

Shepherd Construction Ltd v Pinsent Masons LLP is a salutary reminder to all that when relationships break down, the resulting mess can be very expensive to sort out. Shepherd and Masons had worked together for over 20 years before this dispute. Shepherd sustained losses whilst working on the Trinity Walk shopping centre when The Employer,Continue ReadingContinue Reading