The Supreme Court has ruled to reimburse costs in two recent cases as a result of the unjustified refusal of litigants to resolve a dispute through a pre-trial settlement in the UK. In both cases, the parties relied on their "strong" positions and well-reasoned arguments to resolve the dispute in the court of England. And subsequently they refused to resolve the dispute through pre-trial negotiations. These precedents are another example of the tendency for parties not to abandon the amicable settlement of a dispute in the UK.
In the current situation, where judicial resources are limited and courts are forced to prioritize cases, it is expected that they will increasingly exercise their powers to sanction parties that do not pay enough attention to alternative dispute resolution options in the UK.
Consequences of refusal to participate in pre-trial dispute resolution in England
It is known that unjustified refusal to participate in the peaceful settlement of commercial disputes in the UK can lead to sanctions against the parties to the case. However, what are the criteria that the refusal is unreasonable? In a number of cases, the Court of Appeal has provided a list of non-exclusive factors that indirectly determine these criteria.
In particular, one of the factors is the circumstances of the dispute. For example, one of the parties believes that it has a strong case for a satisfactory court decision. This factor was found to be relevant, since otherwise the plaintiff could potentially get the defendant to settle the commercial dispute before the court, using the threat of penalties in his favor.
At the moment, there are complex and extensive criteria for considering the circumstances of the dispute as a reasonable refusal to resolve the dispute through mediation in England. Thus, the argument of a party that it has every chance of winning the case may be a reason for refusing mediation to resolve the conflict. The defendant's statement that he has arguments and evidence for a positive outcome in court constitutes to some extent an “excuse” for refusing mediation services in England.
And yet, as practice shows, the vast majority of disputes are suitable for pre-trial resolution.
No defense, however strong, does not in itself justify the reluctance to at least try ADR methods. Experience has shown that disputes can often be resolved with a win-win result, including cases where the parties are in doubt about a satisfactory outcome.
A party that refuses to participate in the pre-trial dispute settlement in England on the grounds that they are confident of their victory in the trial must prove and justify this decision. Refusal can have significant financial implications. In light of the current pressure on judicial resources, it is expected that the courts will be even more active in exercising their authority to authorize parties who refuse to resolve a dispute through mediation in England and go straight to court.
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