Senior mediation specialist, Tim Jones, says ways of settling legal disputes
without going to court have been given a major boost by two new
developments.
Tim, head of the employment team at leading law firm 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.jones@higgsandsons.co.uk