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Mediate: Do not drag your feet – A warning from the Court of Appeal

Lord Justice Jackson recently delivered a clear message to parties who play for time when agreeing to mediate.

‘In a case where mediation is obviously appropriate, it behoves both parties to get on with it. If one party frustrates the process by dragging its feet for no good reason that will merit a costs sanction’ [Thakkar -v- Patel [2017] EWCA Civ 117]. 

Jackson’s judgment extends the message sent by the Court of Appeal in PGF II SA v OMFS [2013] EWCA Civ 1288 where the Court of Appeal gave an unequivocal endorsement to the view given in the ADR Handbook that,

“Silence in the face of an invitation to participate in ADR is, as a general rule, of itself unreasonable. That is so even if a refusal to mediate might have been reasonable if the receiving party had engaged with the request in a meaningful way”.

This ruling is another reminder the courts expect litigants to be proactive and engage constructively with one another during proceedings and to properly explore the potential to mediate a dispute.

It can often be a few months between the parties formally agreeing to mediate and actually getting to the table. This ruling is designed to make litigants think twice about using logistical “difficulties” cynically as a delaying tactic.

What it means:

Avoiding mediation is no longer an option. Parties cannot refuse to mediate, ignore requests to mediate, or pay lip service to an agreement to do so. If they do, cost penalties are likely to be imposed.

PBC director, Gary Pettit, is an appointment-taking licensed insolvency practitioner with over 26 years of experience.  During his career he has never lost an action where court intervention has been required.  As a mediator accredited by the Centre of Effective Dispute Resolution (“CEDR”) Gary draws on his successful litigation record when aiding parties negotiate a settlement.

Should you be involved in an insolvency-related dispute where mediation has been (or is being) considered then we at PBC fail to see how the only known mediator who is also a current appointment-taking insolvency practitioner cannot be the right person for you.

For more information, see here or call Gary on 01604 212150.