Articles

30 May 2012

Court support for mediating appeals: a note on Ghaith v Indesit Co UK

by Tony Allen, Solicitor Mediator and Senior Consultant to CEDR

A new pilot within the Court of Appeal Mediation Scheme (CAMS) announced by the Master of the Rolls Lord Neuberger in April was given fresh impetus by the Court of Appeal in Ghaith v Indesit [2012] EWCA Civ 642.  This was a personal injury appeal  by Mr Ghaith against dismissal of his claim against his employers Indesit for breach of statutory duty in relation to a back injury suffered at work.  The value of the claim was put at about £60,000 if liability was established.  In giving permission to appeal, Toulson LJ recommended that the parties utilise mediation, but Indesit’s insurers rejected this on the grounds that costs already incurred exceeded the amount at stake.

The Court (Longmore, Ward and Patten LJJ) allowed the appeal and remitted the case back to the County Court for the assessment of damages, but in doing so Longmore LJ firmly rejected Indesit’s  excuse for rejecting mediation.  He said:

This is an inadequate response to the Court’s encouragement of mediation, since a full day in this Court will inevitably result in a substantial increase in costs.  He went on:

Indesit’s reaction is all too frequent and the Court has, since April of this year, decided that any claim for less than £100,000 will be the subject of compulsory mediation.  It is devoutly to be hoped that such mediation will mean that these comparatively small claims will not have to e adjudicated by this Court so frequently in future.

Ward LJ could not resist endorsing this postscript to Longmore LJ’s judgment, reminding litigants that the granting of permission to appeal shifts the balance of risk.  He also picked up without specifically referencing it an excuse based on factor (c) in Halsey – the fact that there had been previous settlement discussions.  Ward LJ commented wisely (as befits a judge who has undergone mediator training!) that:

It is not enough, as [counsel for Indesit] suggested, that there had been some attempt in the correspondence between solicitors to settle the case.  The opening bids in a mediation are likely to remain as belligerently far apart as they were in correspondence but no one should under-estimate the new dynamic that an experienced mediator brings to the round table.  He has a canny knack of transforming the intractable into the possible.  That is the art of good mediation and that is why mediation should not be spurned when it is offered.

The automatic referral of appeals to mediation (in the absence of any convincing reason to the contrary) will apply to any personal injury and contractual claim involving less than £100,000, though  judges will continue to consider recommending mediation in appeals of whatever value if they believe that mediation is appropriate.  The fee per party remains £850 plus VAT regardless of value, still a bargain, and parties can choose to use CAMS even without a judicial recommendation.  Only patently complex cases where parties could easily afford commercial mediation rates will be excluded from CAMS.  However, Ghaith should remind practitioners that Dunnett v Railtrack lives on – itself an appeal where the single judge recommended mediation.  As the appeal in Ghaith was allowed, there was no question of a costs sanction, but a successful party who refuses to mediate a case which could inexpensively be referred to CAMS faces a real prospect of a sanction for that reason alone, a point emphasised in Halsey as well. 

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