The recently released 11th edition of the Commercial Court Guide includes a number of revisions to the section regarding the use of ADR – including a change of terminology to “NDR” (for “negotiated dispute resolution”).
The revisions will not require any substantial change in day to day practice, and a comparison against the previous edition might appear at first glance as no more than a ‘tidying up’ of the wording. However, the changes are notable in that they can clearly be seen as designed to give effect to the current judicial and government policy drive to embed ADR more fully into court procedure and culture at all stages of the process.
In particular, the revised provisions more closely reflect a system in which ADR is not something that might be considered in appropriate cases but, rather, is a standard or typical step in the mainstream process (which in our experience is the current reality in the Commercial Court for the most part).
Perhaps more importantly, the changes are also more reflective of a system in which both the parties and judge are expected to keep the potential for ADR under active review throughout the entire litigation process (which is something we believe is not always currently the case, and is to be encouraged).
What’s in a name?
The change most likely to be noticed in the short term is the fact that “ADR” no longer exists in the Commercial Court. Or, rather, that “alternative dispute resolution” (ADR) has been replaced by “negotiated dispute resolution” (NDR).
This gives effect to the Master of the Rolls’ well-publicised view that ADR should be treated as in no sense an alternative to the civil justice system but an integral part of it. He observed in a speech last year that he had in some sense been “too successful” in making that point: “Since I pointed out [that view], some Ministers in the UK’s Ministry of Justice have refused to use the term “ADR” moving, more accurately in my view, to the term “DR”.” That was on display in last year’s somewhat confusingly named MoJ Call for Evidence on “Dispute Resolution in England in Wales”, which was in fact limited to considering “methods of resolving civil disputes apart from litigation”.
The call to abandon the term ‘alternative’ is not new, and the fact that it has persisted no doubt simply reflects the lack of any widely acceptable replacement term. That is partly because it depends on the context in which the term is being used. For example, from within the court system, a term such as ‘Additional Dispute Resolution’ might make sense, but would have less meaning outside that context. Similarly, the often-suggested ‘Appropriate Dispute Resolution’ captures the ultimate vision that disputes should be resolved by whatever process is most suitable, but that obviously includes court proceedings and is therefore, like “DR”, not helpful as a replacement for the current term.
Further, it is frequently not clear whether any particular discussion of ADR is limited to processes that facilitate settlement discussions, or extends to processes where the third party adjudicates the dispute. For example, the MoJ Call for Evidence itself was framed as pursuing a policy to mainstream “non-adversarial dispute mechanisms”, but then listed as being within scope processes such as arbitration, Ombudsmen schemes and other adversarial adjudicative processes.
The Commercial Court’s adoption of “negotiated” dispute resolution (NDR) is open to the same objection. On its face it excludes various adjudicative ADR processes used by commercial parties, such as expert determination, disputes boards and adjudication. While those particular processes are currently more likely to be used prior to than during the course of court proceedings, the implied exclusion of adjudicative processes generally is arguably unhelpful to promoting their wider use.
A better (though still not ideal) alternative may have been simply “out-of-court dispute resolution”. Although that technically captures non-facilitated bilateral settlement talks, which are usually distinguished from ADR processes, it at least does not exclude any process. (And in fact the Guide’s provisions do actually also address such bilateral discussions).
Of course, debates about nomenclature are much less important than the substantive issue of how to maximise the potential offered by out-of-court processes. Ultimately, the aim must be to get to a point where there is hardly a need for an umbrella term, as the individual processes are well understood within the court system and wider society and stand on their own. Until then though, the discussion is perhaps a necessary stepping stone.
Interestingly, the name change is not replicated in the recently updated edition of the Queens Bench Guide, which contains no substantive changes to its ADR provisions.
Notably, the relevant section of the Guide no longer opens with the court encouraging parties to consider the use of ADR and listing the potential benefits. That is apparently now treated as a ‘given’. The focus goes straight to how and when proposals for NDR might be raised within proceedings.
Some commentators have suggested that the revised text introduces a change by specifying that parties may apply for directions regarding NDR “at any stage”. That is not the case – the identical statement was in the previous edition. However it has been promoted to the opening paragraph and, significantly, there are no longer additional paragraphs mentioning the CMC as a particular time at which such directions might be sought. (The Guide’s separate section dealing with the CMC is unchanged regarding the consideration of ADR at that time, apart from the name change to NDR).
In respect of the judges’ role in prompting NDR, it remains the case that they “will in appropriate cases invite the parties to consider” it. However, again, additional provisions that focused on this being considered at the CMC have been removed. Also gone is a list of matters that a judge may take into account when considering whether to make a direction to accommodate NDR.
That shifting of focus beyond the CMC reflects another key aspect of the Master of the Rolls’ reform vision across the system, which is that it should be structured to focus on the potential for resolution throughout the entire process:
“Since the sweet spot is different for every case, it is obviously no use suggesting mediation once and then walking away and allowing the lengthy, costly and disruptive court-based dispute resolution process to take its course.”
Finally, also interesting is the deletion of previous text that caveated the encouragement of ADR by “emphasising the Court’s primary role as a forum for deciding cases”, and confirming that “it remains an entirely appropriate forum for resolving most of the disputes which are issued..”. Those caveats were undoubtedly a nod to the historic need to ensure that encouragement of ADR did not cross the line into restricting litigants’ fundamental right of access to the court. It seems no coincidence that they have now been omitted following the Civil Justice Council’s conclusion last year that even mandating ADR would not necessarily cross that line.
Jan O’Neill, Herbert Smith Freehills