Past: The early push for mediation

Over the years, the English judiciary has increasingly encouraged parties to settle their disputes via alternative dispute resolution (“ADR”). In 1994, Lord Woolf was appointed to find a solution capable of reducing the cost, delay and complexity of the litigation process. One of his key proposals was to promote the use of ADR. This was eventually reflected in the Civil Procedure Rules of 1999, whereby courts both encouraged parties to consider ADR and had the discretion to consider this when assessing costs.

Despite these reforms, the costs of civil litigation continued to rise. Lord Jackson’s 2008 review determined that ADR, this time with a particular emphasis on mediation, had a vital role to play in reducing the costs of civil litigation. While this led to the Jackson ADR Handbook in 2013, which provided practical guidance on all aspects of ADR, the Civil Justice Council (“CJC”) formed a working group in 2016 to review how ADR could be further encouraged. Their recommendations included reforms to reinforce a presumption that ADR should be attempted and more rigorous penalties for unreasonably failing to do so.

Present: Rise in popularity and online mediation

The initiatives above did eventually help to transform mediation into a popular dispute resolution mechanism. According to the Centre for Effective Dispute Resolution’s (“CEDR”) 2021 Mediation Audit, there has been an acceleration of growth in mediation cases over the last two decades.

The high settlement rate in mediation is a particularly attractive feature. For the last decade, the proportion of mediation cases that achieved settlement has been close to 90%, with the rate for 2020 reaching 93%.

An important reason for the boom in mediation has been the closure of courts with some 51% of magistrates’ courts being closed between 2010 to May 2020. This resulted in increased backlogs and delays, which gave impatient litigants cause to look for other options.

More recently, the most significant development for mediation has been the COVID-19 pandemic, when the virtual format became the only option. In the 12-month period immediately before the pandemic, around 10% of mediation cases were conducted online. However, from March to September 2020, this increased to 89% of cases (with the total number of cases falling by 35%).

In terms of attitudes to online mediation, there are mixed reactions. While there is a certain ease of access arising from the avoidance of travel and flexibility of location, there is broad consensus that it can be more difficult to build a rapport with others online, and conducting the occasional side conversation is effectively impossible. Despite these difficulties, many parties have not been deterred, and have continued to partake in mediations this way.

Future: The way forward

Looking ahead, it seems likely that mediation activity will continue to increase. There are plans to close yet another 77 courts by 2025/2026 and despite pandemic-related restrictions being eased, it is certainly possible that some practical constraints will continue for a while. Parties are therefore likely to continue to be incentivised to pursue ADR routes such as mediation. The online forum is also unlikely to be viewed as a hindrance; the pandemic having no doubt accelerated a change in attitudes, with more practitioners accepting that this may be the “new normal”.

The question now is whether a more radical step is needed, such as mandatory mediation for low-value disputes – a reform that other common law jurisdictions have embraced with good results. The CJC’s recent report on compulsory ADR concluded that it should be encouraged and Sir Geoffrey Vos, Master of the Rolls and CJC Chair and Head of Civil Justice considers that “… ADR should no longer be viewed as ‘alternative’ but as an integral part of the dispute resolution process; that process should focus on ‘resolution’ rather than ‘dispute’ “.

There is certainly a significant shift towards earlier resolution. However, the staying power of ADR, and mediation in particular, will come from its ability to adapt and serve the needs of involved parties in a rapidly changing world. While it began as an underused alternative, many signs point to it becoming the go-to option for commercial disputes.

Claire Broadbelt, Partner, Mishcon de Reya
Elizabeth Montpetit, Managing Associate, Mishcon de Reya
Mohammed Nazeer, Litigation Paralegal, Mishcon de Reya