Order 56A of the Rules of the Superior Courts (RSC) empowers the superior courts, on their own motion or that of one of the parties, to invite the parties to avail of an alternative dispute resolution (ADR) process or to refer proceedings to an ADR process where the parties agree.
An ADR process is defined as including mediation, conciliation, or another process approved by the court, but arbitration is expressly excluded. By contrast with section 15 of the Civil Liability and Courts Act 2004 (applicable in personal injuries actions only), order 56a does not provide for compulsory mediation or ADR. Whether to engage in an ADR process if invited to do so by the court under order 56A remains a decision for the parties alone. However, under order 99(1)(b), the court may depart from the rule that costs follow the event where the court has invited the use of an ADR process pursuant to order 56A, and the (ultimately) successful party has, “without good reason”, failed to participate in that ADR process.
The courts have given guidance concerning the circumstances in which the parties ought to be invited to engage in an ADR process under order 56A, most recently in Grant & Ors v Minister for Communications & Ors ([2016] IEHC 328).
In Grant, the plaintiffs’ claims against the State arose out of the regulation of shipping, as it affected several vessels owned by the plaintiffs over a number of years in the late 1990s and early 2000s. The case, which began in 2003, was legally and factually complex and was ready to be set down for trial by the time the plaintiffs’ order 56A application came to be determined.
Refusing the application for an order under order 56A, Costello J was critical of the plaintiffs’ delay in suggesting mediation and noted that “the proceedings have progressed over 13 years with all the expense that entails, including the costs of discovery, to the point where the case is ready to be set down for trial. It is the experience of the courts that proceedings are most likely to be resolved by mediation after the pleadings are closed, but before the parties have incurred the expense of complying with discovery. They are far less likely to be resolved by a mediation just before the case is ready to proceed a fortiori where one party does not wish to engage in mediation.”
Costello J followed the judgment of Gilligan J in the High Court in Atlantic Shellfish & Ors v The County Council of the County of Cork & Ors ([2015] IEHC 570), as affirmed by the Court of Appeal at [2015] IECA 283, in taking into account that mediation was less likely to succeed where one of the parties was not a wholly willing participant. Following the Atlantic Court of Appeal decision, Costello J was also satisfied that it was reasonable for the State defendants to seek to vindicate their conduct in open court, given the very serious allegations, including misfeasance, made against certain named officials.
Costello J noted that a resolution of the proceedings would require the parties to abandon the positions that they had maintained in the proceedings for 13 years and, while acknowledging that this was possible, regarded this as a matter of considerable weight in the exercise of the court’s discretion. Costello J noted counsel for the State’s submission that a mediation would be long and complex because of the complexity of the proceedings and would, therefore, impose a significant cost on the State, which was unwilling to mediate. Costello J concluded that the State’s refusal to mediate was bona fide and that an invitation to do so ought not to be issued by the court under order 56A.
Comment
Despite the outcome in each case, the judgments in Atlantic and Grant roundly endorse the benefits of mediation. The refusal to direct that order 56A requests be issued in both cases turned on the late stage at which an order was sought and other relevant factors. In Atlantic, there was a novel point of law raised that had a precedent value; in Grant, there were serious allegations made against State officials, which the State wished to have legally determined.
The Mediation Bill, published in February 2017, will place an obligation on solicitors, prior to commencing proceedings for clients, to advise those clients to consider resolving their dispute through mediation, explain what the process entails, and provide names of mediation service providers.
If enacted, it will be interesting to see how these provisions will impact the timing of applications under order 56A, given that plaintiffs will have considered and decided against mediation before issuing proceedings.
In that scenario, will the exchange of pleadings be enough to change a plaintiff’s mind or will discovery be necessary, contrary to the timing guidance in Grant?