Page 79 - Solving Housing Disputes

subsidise or offer ADR methods whose costs are proportionate to values in
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issue.

3.43 We understand that the Civil Justice Council has recently convened a judicial
liaison group to look broadly at the positioning of ADR within the civil justice
system. There is a need for any work on ADR in civil justice to consider its role
at the pre-action stage. We recommend the Civil Justice Council consider how
awareness of and uptake of ADR at the pre-action stage in housing disputes
can be promoted and encouraged. Consideration ought to be given as to how
court mediation services can be properly funded to allow them to reach their
full potential, including the need for mediation and other ADR types to be
made more widely available to the parties at the pre-action stage.

3.44 The general position in civil disputes is that the losing party bears the winning
party’s costs of litigation, subject to certain qualifications. In deciding costs
orders, the court must have regard to the conduct of the parties during the
litigation, including compliance with relevant pre-action protocols or practice
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directions and should not allow costs that are unreasonably incurred,
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214
unreasonable in amount or disproportionate to the matters in issue. Failure
to respond to or engage in an invitation to engage in ADR can be viewed as
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unreasonable conduct and can result in costs sanctions.

212 The CJC has noted the peculiarity that a 1-hour telephone mediation is offered free of charge for
claims up to £5,000, but that there is no subsidy or offering for cases worth £50,000, CJC note 209 above
para 7.4.

213 CPR 44.2(4)(a). and CPR 44.2(5)(a). The Practice Direction on Pre-Action Conduct and Protocols
explains that “if proceedings are issued, the parties may be required by the court to provide evidence that
ADR has been considered”.

214 CPR 44.3(1)(b).

215 CPR 44.3(2)(a).

216 The Court of Appeal decision in Halsey v Milton Keynes General NHS Trust [2004] EWCA Civ 576
sets out a list of factors relevant when deciding whether a refusal to mediate is unreasonable, including
(a) the nature of the dispute (b) the merits of the case (c) the extent to which other settlement methods
have been attempted; (d) whether the costs of the ADR would be disproportionately high; (e) whether
any delay in setting up and attending the ADR would have been prejudicial; and (f) whether the ADR
had a reasonable prospect of success. The recent report from the Civil Justice Council on ADR and civil
justice criticised these “Halsey Guidelines” as too generous to parties and recommended the
circumstances where a refusal to mediate is permissible ought to be narrowed, Civil Justice Council, note
209 above para 2.6 and recommendation 21.

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