Higgins: Fine-tuning PAPs
Parties that engage in formal pre-action dispute resolution should be exempt from any mandatory requirement to mediate post-issue, a Civil Justice Council (CJC) working party has recommended.
It also recommended the creation of two new pre-action protocols (PAPs) – one for dealing with child abuse claims and another for multi-track claims in the Business & Property Courts (B&PC).
Following an interim report and consultation which closed in January 2022, the CJC PAP working group split its final response, with part one, published in August 2023, setting out proposed reforms to the practice direction on pre-action conduct.
This included creating a new general PAP, as well as the principles that should guide the development of digitalisation of pre-action processes. It said compliance with PAPs should be “formally mandatory”.
It has now published part two, focusing on potential reforms to specific PAPs and the creation of new ones.
The report also considered the impact of the various moves towards mandatory mediation post issue, including last year’s Court of Appeal ruling in Churchill.
The working group said its recommendations would complement these developments. While there was “a risk of unnecessary duplication were parties automatically required to engage in mediation both before and after issuing proceedings, particularly in small claims disputes”, this was not what it was recommending.
The part 1 report urged a “non-prescriptive” obligation in the general PAP for the parties to engage in a “dispute resolution process with each other prior to any proceedings being issued”.
The new report said: “If parties choose to engage in a formal ADR process with the assistance of a third party at the pre-action stage, it is the working group’s recommendation that those parties should be exempt from any automatic requirement to engage in mediation after issuing proceedings.
“The working group does not rule out the possibility that there may be some cases where the court considers the parties are sufficiently close that another round of mediation has a real prospect of finally resolving the dispute.” This would be a matter of the court’s discretion.
This possibility should also be made clear in all PAPs, the report said, which “may effectively incentivise the parties to engage in mediation, or other formal dispute resolution process, at the pre-action stage”.
The working group said it had heard concerns from commercial lawyers that a more structured PAP process like the general PAP would not provide the flexibility needed for complex high-value commercial litigation.
It consulted with the likes of the London Solicitors Litigation Association and commercial and chancery Bars, and concluded that a separate PAP was warranted for multi-track litigation in the B&PC.
It recommended that the PAP be mandatory subject to exceptions for urgent cases, where the parties have engaged or agreed to engage in an equivalent dispute resolution process – such as an escalation clause or tiered dispute resolution clause – and where the parties have agreed in writing to opt out of the PAP.
This latter provision recognised that some disputes involved international parties “who have opted to submit their disputes to the English courts”.
While the PAP, a draft of which was annexed to the report, should include the non-prescriptive pre-action dispute resolution obligation, it should not include the general PAP requirement that the parties should carry out a ‘joint stocktake report’ before embarking on litigation.
Group chair Andrew Higgins, professor of civil justice systems at Oxford University, said: “All the recommendations in part I and part II of the CJC’s review are geared towards fine tuning this critical function, helping to ensure PAPs contribute towards a fair settlement of the dispute, or a narrowing of the issues and more proportionate litigation where settlement is not possible.
Sir Geoffrey Vos, Master of the Rolls and chair of the CJC, added: “Pre-action protocols are vital to facilitating fair and proportionate dispute resolution. This second phase of work provides important recommendations about specific subject-area protocols. I very much hope that their implementation will be prioritised.”
It will now be for the Civil Procedure Rule Committee and, in some cases, the Online Procedure Rule Committee to take the recommendations forward.
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