Untangling disputes

Huw Davies examines some useful guidance on the use of Alternative Dispute Resolution in disputes involving local authorities.

The well-oiled wheels of litigation are in no immediate danger of falling apart, whilst they might occasionally creek due to the pressure of an increasing workload and the need for better facilities across the court estate, our litigation procedure continues to hold its own; and respectfully so. That said the case involving Churchill and Merthyr Tydfil County Borough Council [2023] EWCA Civ 1416has re-emphasised the importance of both corporate governance procedures and also ADR.

Mr Churchill having bought a house in 2015, complained to the Council that Japanese Knotweed had encroached his garden from the adjoining Council owned land and this in turn had caused both a loss of value and enjoyment.

When Mr Churchill duly complained to the Council in 2020, the Council in turn questioned why he hadn’t used the Council’s own corporate complaints procedure to deal with his complaint. Mr Churchill was notified by the Council that if he initiated legal proceedings, they [the Council] would seek to stay the proceedings on the basis that Mr Churchill hadn’t followed their procedure. Mr Churchill issued proceedings in the Court and the Council applied for a stay of proceedings.

Deputy District Judge Kempton Rees dismissed the stay application on 12 May 2022, having delivered a reserved judgement. The DDJ held that he was bound to follow Dyson LJ’s statement in Halsey v. Milton Keynes General NHS Trust [2004] EWCA Civ 576, [2004] 1 WLR 3002 to the effect that ‘to oblige truly unwilling parties to refer their disputes to mediation would be to impose an unacceptable obstruction on their right of access to the court’ and accordingly refused the Council’s request of a stay of proceedings.

The DDJ also found that Mr Churchill and his lawyers had acted unreasonably by failing to engage with the Council’s complaints procedure - the conduct in question was found to be contrary to the spirit and the letter of the relevant pre-action protocol. (Practice Direction on Pre-Action Conduct and Protocols (as amended) which applied, as there was no specific applicable pre-action protocol.)

On 4 August 2022, HH Judge Harrison granted the Council permission to appeal and given the important point of principle in question, was duly referred to the Court of Appeal.

Court of Appeal’s Decision
The Court of Appeal (Baroness Carr, Lady Chief Justice, Sir Geoffrey Vos, Master of the Rolls (delivered the judgement), and Lord Justice Birss) allowed the appeal in part and decided [for our purposes] that:
i) The passages from Dyson LJ’s judgment in Halsey, relied upon by the judge, were not part of the essential reasoning in that case and therefore the judge was not bound to dismiss the Council’s application for a stay.
ii) The court could lawfully stay proceedings for, or order, the parties to engage in a non-court-based dispute resolution process provided that:
a) the order made did not impair the very essence of the claimant’s right to proceed to a judicial hearing; and
b) was proportionate to achieving the legitimate aim of settling the dispute fairly, quickly and at a reasonable cost.
iii) The court would not lay down fixed principles as to what would be relevant to determining whether proceedings should be stayed or whether to order the parties to engage in a non-court-based dispute resolution process.
iv) In the circumstances of this case, a stay of the proceedings would not now be granted, but the parties ought to consider whether they could agree to a temporary stay for mediation or some other form of non-court-based adjudication.

Joined Parties
Given the importance of the case and the potential consequences, there were seven interested parties (interveners) that took part in the Court of Appeal hearing, these were:
(1) The Law Society
(2) The Bar Council
(3) The Civil Mediation Council
(4) The Centre for Effective Dispute Resolution
(5) The Chartered Institute of Arbitrators
(6) Housing Law Practitioners’ Association
(7) The Social Housing Law Association

Judgement given … what next?
Professional advisers need to actively consider and advise their clients if their disputes can be dealt with in an alternate way to what has been the default way – initiating court-based proceedings. Clearly certain matters will obviously need to be dealt with in the courtroom, but there is a large cohort of disputes that can equally be resolved fairly, quickly and at a reasonable cost using alternate means. Indeed, proceeding to trial and not considering or declining to use alternate forms of dispute resolution, may result in an adverse cost finding regardless of who ‘wins the point’.

In terms of the ADR toolkit, there are many forms of tried, tested and appropriate mechanisms, depending on the circumstances of the case which can be used. It is also encouraging to note that the Court of Appeal did not seek in any way to limit the parties’ freedom of choice, nor did they curtail the judges’ discretion by way of a checklist or scoresheet.

The ADR toolkit of course includes both the traditional forms such as mediation, adjudication, neutral evaluation, arbitration but also allows parties to use novel or more situation specific approaches such as Arb-med – a format which has gained increasing in popularity. Used properly, there are advantages to both the professional client and the adviser; and equally importantly a platform to attract an increasing number of international clients to benefit from using our legal industry.

Organisational complaint procedures – a practical consideration
Mr Churchill argued, as part of his argument, that the complaints process being applied by the Council was unsatisfactory; arguably, had this not been the case, then this matter would not have progressed any further. Organisations should therefore consider reviewing their complaints and indeed all public facing or third party-based procedures. In terms of an organisational complaints procedure, whilst an organisation might be confident in its process, has the organisation ever considered it from a public perspective – would it be perceived by the user as ‘independent’ or what steps are required to give the user the required peace of mind?

Whilst the ADR toolkit can ultimately be used to efficiently address a dispute, in terms of the escalation route-map an effective complaints process from a governance perspective is equally as important. Indeed, an effective complaints system will ensure that complaints are appropriately dealt with and in the vast majority of cases, avoid becoming disputes. It’s suggested that organisations also need to carefully consider whether they adopt a ‘one hat fits everything approach’ or whether or not there’s a need for a more flexible approach.

Looking ahead
1) In terms of corporate governance and compliance generally, organisations need to ensure that they have an appropriate system in place to deal with complaints and other corporate or organisational requirements, especially when dealing with members of the public and other third parties.
2) Organisations and individuals alike should stop and actively consider whether or not their dispute / grievance can or should be dealt with in an alternative way, other than initiating court proceedings – especially when this means settling the dispute fairly, quickly and at a reasonable cost.

Huw Davies is a door tenant at 30 Park Place and is an experienced corporate governance compliance and ADR practitioner, both within England and Wales and internationally (the Middle East in particular). Huw would be more than happy to advise on matters relating to corporate governance procedures (e.g. complaints process) or the use of alternative dispute resolution mechanisms, please feel free to contact him on This email address is being protected from spambots. You need JavaScript enabled to view it.

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