Why do only about 7% of trials attempt mediation?

In England and Wales, parties to a legal dispute are obliged to attempt to resolve their dispute using negotiation, mediation or arbitration before they come to court, or indeed before they even issue legal proceedings. This is quite explicit in the pre-action protocol of the Civil Procedure Rules:

“Litigation should be a last resort … the parties should consider whether negotiation or some other form of ADR might enable them to settle their dispute without commencing proceedings.”

and

“If proceedings are issued, the parties may be required by the court to provide evidence that ADR has been considered. A party’s silence in response to an invitation to participate or a refusal to participate in ADR might be considered unreasonable by the court and could lead to the court ordering that party to pay additional court costs.”

There are plenty of well-known cases where courts have imposed cost sanctions on parties who have not made reasonable attempts to mediate. And judges can get really quite cross when faced with parties who have failed to mediate.

I’ve collected a selection of quotes, mostly from the Court of Appeal, but some from lower courts. These give you a flavour of just how seriously some senior judges view mediation:

“...mediation is a proper alternative which should be tried and exhausted before finally resorting to a trial of the issues … Judge Thornton attempted valiantly and persistently, time after time, to persuade these parties to put themselves in the hands of a skilled mediator, but they refused. What, if anything, can be done about that? You may be able to drag the horse (a mule offers a better metaphor) to water, but you cannot force the wretched animal to drink if it stubbornly resists. I suppose you can make it run around the litigation course so vigorously that in a muck sweat it will find the mediation trough more friendly and desirable.”

Ward LJ, Wright v Michael Wright Supplies Ltd [2013] EWCA Civ 234

“You should settle your differences (or those of your clients) away from court, except where that is not possible. If you do bring unnecessary cases to this court, you will be criticised, and sanctions may be imposed upon you. There are many other ways to settle disagreements, such as mediation.”

HHJ Wildblood, Re B (a child) [2020] EWFC B44

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“This litigation fills me with real gloom and despair. Its first expedited hearing was listed for two to three days. It is now listed for 25 days. Like Topsy it has grown and I cannot but wonder whether it has grown out of all proportion. It strikes me yet again as the kind of case which should not return to this court before the parties have undertaken some mediation.”

Ward LJ, Khudados v Hayden & Ors [2007] EWCA Civ 466

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“Mediation is the obvious way in which to explore these matters and allow the parties to move on before they cripple themselves with more debt.”

Ward LJ, Wright v Michael Wright Supplies Ltd [2013] EWCA Civ 234

“Understand that the process of mediation involves give and take on both sides. It is no good going into mediation saying, 'Be reasonable. Do it my way.”

Thorpe LJ, Day v Day [2002] EWCA Civ 1842

“I would hope that the parties may be able to reach a financial settlement of this unhappy dispute without the need for a further hearing in this court.”

Brook LJ, Neal v Jones (t/a Jones Motors) [2002] EWCA Civ 604

“It seems to me daft for these parties to embark upon this appeal without having thought of undertaking some process of mediation ... therefore I add my exhortation that mediation should be undertaken because it could produce the answer of practical importance to these parties. It will save the Court of Appeal a great deal of work.”

Ward LJ, Ezsias v Welsh Ministers [2008] EWCA Civ 874

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“This is an appeal solely about costs. It is also a sad case about lost opportunities for mediation. It demonstrates, in a particular class of dispute, how wasteful and destructive litigation can be.”

Rix LJ, Rolf v De Guerin [2011] EWCA Civ 78

You may notice that several of these quotes are from Sir Alan Ward (Lord Justice Ward as he was then). Sir Alan was himself an accredited mediator and after his retirement from the judiciary, he served as chairman of the Civil Mediation Council until 2019.

What effect have these judicial tellings-off had on the lower courts? Not enough, it would seem. There are about two million cases filed in the County Courts of England and Wales each year. Most of these go undefended, so perhaps are not suitable for mediation. But in 300,000 cases, the defendant files a defence so presumably disagrees with at least some of what the claimant is saying. And 65,000 go all the way to trial. These figures are from the Ministry of Justice Civil Justice Quarterly Statistics, and I’ve used numbers upto Q1 2020, to match up with figures on mediations from CEDR.

How many mediations happen each year? About 12,000, according to CEDR’s 2020 mediation audit. 90% of those settle, so 10% (1,200 cases) would continue to trial. That implies that of the 65,000 trials, only about 1,200 have attempted mediation.  It might be that many of the smaller cases found their way to the Court Service’s own Small Claims Mediation Service and so are not counted in those 1,200 mediations .... but even if you exclude all the Small Claims (<£10k), and just look at trials involving larger claims, there are still 17,000 of those. 1,200 mediations out of 17,000 big-ish trials is still just 7%. 

The remaining 93% seemingly never attempted mediation. They can’t have attempted arbitration either, because if they had been to arbitration, they would have received a binding decision from the arbitrator and would not need a court trial.

There will be some cases where one side needs to go to court to establish a point of law, but those will be rare. In spite of the clear expectation of the civil procedure rules, and in spite of the risk of getting criticised by a judge even if you win, 93% of trial cases are still not getting in front of a mediator. As a new mediator, this situation seems astonishing to me. What is behind this curious state of affairs?

It seems to me that the judges who take mediation seriously may be in the minority. The most vocal, Lord Justice Ward, is now long retired. Sanctions are perhaps rare, so parties don’t really take seriously their obligation to attempt mediation. At one mediation that I observed during my training, there had been a direction from the judge a year earlier requiring the parties to consider mediation and, if one side refused to engage in mediation, they were to file with the court their reasons for refusal. The deadline for that had long passed, no-one had complied, no-one seemed terribly bothered that they hadn’t. The mediation was only hastily convened when a trial date was offered and the parties realised they had not complied with this order. It settled, but it could have settled almost a year earlier, at far lower cost.

The lifecycle of a case tends to steer it away from mediation very early in the process. The first letter which a solicitor will write on behalf of their client is likely to be very comprehensive, covering every imaginable reason why the claim is rock solid, or baseless, depending on which side they are representing. The other’s reply will be equally detailed, painstakingly attempting to rebut every single point that the other made.

This serves two purposes, one intended and one not. The primary purpose of this approach is to cover all possible angles early on, and present a very strong case to scare off the other side. The second consequence, unintended, is that it serves to entrench each side and increase the gap between them to as wide as it can possibly get.

“Our case is solid for this long list of very good reasons.”

“Your case is worthless, for this other list of very good reasons.”

There is no common ground at this point. By going legal the parties have moved further apart than they have ever been.

You can see why few people suggest mediation at this point. Suggesting a negotiated settlement is going to make it look like you don’t think your case is as strong as your lawyers have just been saying. It will appear as a sign of weakness.

But setting out the strongest possible case serves a useful purpose: it does ensure that each side fully understands what the other side is going to rely on in court. It doesn’t seem feasible or useful to discourage lawyers from adopting this adversarial approach - it serves a purpose.

Regulators could adopt the approach which financial market regulators adopt: if you publish a prospectus promoting your business to investors, you have to include a section about risks. You have to list all the reasons why the investment might not work out.

Could regulators require lawyers to list, in their correspondence with the other side, all the reasons why the other side might actually win? It doesn’t seem feasible or sensible to do that. It feels like heavy-handed interference into each side’s freedom to negotiate as they see fit.

So the challenge is, given the inevitable gulf between the parties which will arise once they have got lawyers involved, how to defuse the tension sufficiently to allow room for mediation?

Clearly the Civil Procedure Rules already attempt to do that, but it seems that they are ineffective.

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The Civil Justice Council is currently looking at the question of making mediation compulsory. This feels, to me, like a step too far. But some countries do already make mediation compulsory. I heard from a Turkish mediator that mediation is compulsory for commercial litigation in Turkey. When this law first came into being, mediation was treated as a tick-box exercise, with parties paying lip-service to the idea, just to get a certificate which allowed them to proceed to a trial. But after a little while, as more lawyers and clients had exposure to mediation, parties became increasingly open to using mediation to actually resolve their dispute.

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In family cases in this country, parties have to attend an initial Mediation Information & Assessment Meeting before they can go to court. Could something similar be used in commercial cases?
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Another solution might be through bureaucratic nudging from the system. For example, would it make a difference if the claim form which claimants must file included a reference to mediation? That form, in England and Wales, makes no mention of ADR at the moment. It could include, for example, a very specific question like “Please enter the date when you invited the defendant to settle this matter using ADR”. That would surely focus the claimant’s mind. Same with the form which defendants complete: this makes no mention of ADR at the moment.

A small bureaucratic nudge like that might make a lot more difference than the occasional judicial reprimand echoing down from the higher courts.