Recent court decisions have affirmed the need to use mediation to solve disputes. Gary Meggitt says we must evolve from `rottweiler litigation'
Rorschach was a character in the cult 1980s graphic novel, The Watchmen. Those readers who know little, and care less, about such literature need not worry. I am not going to launch into a paean on comics. It is simply that Rorschach had something in common with many people involved in litigation - his attitude. This is best summed up in Rorschach's own words: "No. Not even in the face of Armageddon. Never compromise."
This may be an admirable quality in a superhero, but those who run the English civil courts do not view it at all favourably. The judiciary disparages such an approach to dispute resolution. The extent of their views and the consequences for litigants can be seen in the Court of Appeal's recent decision in Dunnett v Railtrack.
The claimant sought compensation from Railtrack when three horses were killed on the line after a gate to her paddock, which had been replaced by Railtrack, was not padlocked. The Court of Appeal dismissed the claim. A piece of rare good news for Railtrack then? Well, no. Railtrack received no costs despite winning the appeal. The reason for this was Railtrack's attitude towards mediation.
When the claimant was granted an appeal from the trial judge's decision, she was told that she should attempt to resolve her differences with Railtrack by alternative dispute resolution (ADR). Railtrack refused to do so. Accordingly, Lord Justice Brooke held, and his colleagues agreed: "Given the refusal of [Railtrack] to contemplate alternative dispute resolution...the appropriate order on the appeal is no order as to costs."
Railtrack was not punished for not "settling", it was punished for not even entering into mediation. The case report does not explain fully why Railtrack refused to mediate. It would be surprising if its solicitors, Beachcroft Wansbroughs, had not advised it that the Civil Procedure Rules (CPR) actively promote mediation and contain costs penalties for those who litigate "unreasonably". Perhaps it truly thought the settlement payments it had offered made mediation unnecessary. Perhaps it thought its strong case was justification for refusing to mediate. If so, it was mistaken.
Nowadays, the courts believe mediations, even unsuccessful ones, are better than trials. The Lord Chief Justice Lord Woolf, himself, said in Cowl v Plymouth City Council earlier this year: "Today, sufficient should be known about ADR to make the failure to adopt it... indefensible."
Should insurers be worried? No. On the contrary, many insurers have long recognised the benefits of mediation. It is, after all, potentially quicker and cheaper than litigation. It is also more predictable, consensual and flexible (in terms of potential outcomes) than litigation. The mediation process is controlled by the parties, not by a judge, and can be kept private.
Yet these and other advantages of mediation over the litigation `slugfest' are still unknown to many and denied by some. There is the desire for "My day in court" and the fear of compromise is a sign of weakness. Trust, the vital component in any mediation, is often missing. Too many parties share the delusion that a trial will solve their problems. This delusion is often only dispelled when the judge's decision goes "the wrong way"... and then it's too late.
The Dunnett and Cowl decisions, together with further reforms to the CPR and the expanding pre-action protocols, should maintain the evolution from `rottweiler' litigation into more commercially practical forms of dispute resolution. Insurers can play their part in this process and save themselves time and expense. They can educate insureds on the virtues of ADR. They can insist insureds include ADR clauses in their contractual arrangements with their customers. Insurers should also ensure their own staff and their advisers are `mediation savvy'.
This is not a call to drop litigation. Nor is it a call for peace at any price. It is to recognise that litigation and mediation are options for resolving disputes. When choosing which one to use, the aim should not be to pick the strong one, but the right one.
Gary Meggitt is a solicitor at Fishburn Morgan Cole, London and stood for the Conservative Party against Treasury minister Ruth Kelly at the last election
