More needs to be done to encourage the use of technology to facilitate settlement

Kennedys has responded to the Ministry of Justice’s Call for Evidence on the future of dispute resolution in England and Wales, highlighting that technology has the potential to resolve disputes on a more efficient, humanised, simpler and inclusive basis.

On 3 August 2021, the Ministry of Justice (MoJ) launched a consultation with the aim of seeking to mainstream non-adversarial dispute resolution mechanisms, so that resolving disagreements, proactively and constructively, becomes the norm.

The Call for Evidence closed on 31 October 2021. The responses will inform the development of the government’s policy interventions.

Kennedys’ response

In our view, transparency and fairness are the bedrock of the justice system, and technology can and should be harnessed to provide innovative solutions not only in relation to alternative dispute resolution (ADR) but the system more widely.

Lawyers are increasingly deploying their skills to navigate the civil justice system, rather than to provide legal advice. Consequently, alternative forms of resolution, like mediation, are not front of mind. Instead, going to trial often remains the cultural and behavioural end-point.

We believe that if used properly, technology has the potential to resolve disputes on a more efficient, humanised, simpler and inclusive basis. Implicit in that outcome is the requirement for effective data collection and evaluation in order to realise the opportunities for understanding the behavioural science behind our justice system and in turn, how it can be continually improved to reflect and meet the needs of the end-user.

If ADR is to become increasingly mainstream or even mandated, review and implementation will require a corresponding level of consideration and wider reform to ensure unintended consequences are avoided such as poor litigation behaviours and costs layering.

Deborah Newberry, Corporate Affairs Director

Our response concludes that any increased use, encouragement or mandated ADR must be in conjunction with the following:

  • A commitment to enforcing pre-action protocols
  • Tackling poor behaviours
  • An obligation for all parties to use and engage with technological solutions, or risk sanctions in the absence of a reasonable refusal.

Pre-action claims

The overriding aim of the current Civil Procedure Rules is to enable cases to be conducted proportionately and promote the use of pre-action protocols to bring about early settlement so that litigation is a last resort. However, this objective is not being fully realised. The rules ‘lack teeth’ as they are rarely enforced with sanctions for non-compliance. We are, therefore, of the view that more robust and rigorously enforced pre-action protocols would encourage an exchange of information and cooperation at an earlier stage. Ultimately, this would lead to more cases settling at the pre-action stage, whether by way of ADR or not.

Bad behaviours must be tackled – both pre-action and during litigation

Bad behaviours including lack of communication between the parties and/or with the court and failing to provide sufficient disclosure, remain within the court system, which raise access to justice considerations. Such behaviours are frequently driven by the desire to cost-build. We are of the view that there is a real risk of these poor behaviours transferring through to the proposed mainstream non-adversarial dispute resolution mechanisms. As such, we recommend tackling these behaviours prior to or in conjunction with any change to the current system.

In terms of litigated claims, an ADR court direction is a normal feature of case management orders in civil claims. Even in the absence of such a direction, winning parties have been at risk of sanctions for unreasonably failing to mediate and recent case law indicates a hardening approach by the courts towards parties who decline the offer of ADR. We assert that simply mandating ADR will not necessarily lead to a faster, fairer and cost-effective resolution.

Technology is part of the solution to mainstream ADR

Based on our experience, practitioners can be reluctant to use technology in order to facilitate settlement. Therefore, more needs to be done to encourage engagement. This in turn, will assist in changing the cultural and behavioural mind-set that going to trial is the end-point.

That is not to say that all claimants wish to go to court. We find that some claimants, especially in the personal injury arena, are nervous about being cross-examined and find litigation very stressful. In our experience, many cases settle close to the trial date.

Insurers, on the other hand, are often motivated to engage in early ADR as it can be a cost-saving exercise. We believe that more could be done to encourage claimants in particular to engage in innovative ADR solutions. This encouragement should come from policymakers, the government and the judiciary.

Concluding comments

We can appreciate the potential advantages of compulsory ADR, such as focusing minds on resolution or at least to narrowing the issues in dispute. However, we do not believe that ADR should be compulsory in all disputes because in practice, making it compulsory could lead to ADR not being treated with the seriousness it deserves and consequently, may ultimately lead to increased costs.

Rather, we believe that it is better to focus on a strong expectation on the parties that ADR will be used, in conjunction with a judicial willingness to take action when parties unreasonably refuse.

Ultimately, in our view, ADR is often underused. We believe technology can assist in the resolution of disputes and it is an opportune time to rethink dispute resolution and embrace the full potential of technological solutions.

Read other items in Commercial Brief - November 2021