Alternative Dispute Resolution

Introduction

Psychology

Principled negotiation

Mediation

Barrister Assisted Mediation

Early Neutral Evaluation

Chancery FDR

Guided Settlement

Conclusion

To enquire about instructing me please send an email to carl@ihtbar.com.

I am a registered public access Barrister and can be instructed directly by a member of the public without the involvement of a solicitor. I belong to the South Eastern Circuit (which includes London), and am a SCMA accredited mediation advocate (www.mediationadvocates.org.uk), having acquired actual mediation advocacy experience in settling contentious probate disputes.

Introduction

‘Know your enemy and know yourself and you can fight a hundred battles without defeat.’ Sun Tzu, ‘The Art of War’ (‘Sun Tzu’).

Costs/risk calculus

From the outset, and throughout the conduct of the case, it is incumbent upon a practitioner to evaluate his client’s costs/risk calculus and the benefits of proposing/engaging in ADR. To obtain a quick indication you can roughly estimate the cost of your client getting what he wants (i.e. if he wins), and factor in the litigation risks. Even if your client wins, and nothing is absolutely certainty in litigation, where an executor is entitled to an indemnity out of the estate for costs properly incurred, the capital value of the estate will have been diminished by legal costs and experts’ fees incurred in the litigation. Lose, and your client ends up in negative equity. Then compare the costs of ADR with the costs of a trial.

Statistically most cases issued in the Chancery Division actually settle.

‘…[Trial] is, and probably always has been, the method of resolution of only a tiny minority of chancery disputes. The settlement rate of cases issued in the Chancery Division in London during the last 5 years ranged between 92.3% and 94.4%, and that excludes settlements taking place after the start of the trial. Traditionally, most disputes have been resolved by unstructured negotiations between the parties or their lawyers, a process involving no management or intervention by the court, save acceding to the last minute request to delay the commencement of a trial while the parties frantically conclude settlement negotiations at the court door… The standard form of chancery case management directions…contains an optional provision for a one month stay for “the parties to try to settle the disputes by alternative dispute resolution or other means.” The extent to which oral encouragement is given to the parties, at CMC’s or otherwise by the Chancery judges, is left to individual preference and discretion. No national policy, guidance or training in that regard has been attempted. That said (and as has been pointed out during consultation) the very high settlement rate in the Chancery Division is by no means unsatisfactory, and may fairly be said to reflect the fact that case management by Masters and District Judges along current lines has been a substantial contributor to resolution of disputes otherwise than by trial.’ Lord Justice Briggs in the ‘Chancery Modernisation Review: Final Report’, December 2013.

Court’s powers

Where appropriate the court will, as part of the overriding objective, encourage the parties to use ADR or otherwise help them settle the case or resolve particular issues. There should normally be discussion at the case management conference about what steps have already been taken (if any), and those which ought to be considered in future, to try to resolve the claim.

The court will readily grant a stay at an early stage of the claim to accommodate mediation or any other form of ADR if the parties are agreed that there should be a stay. A consent order may be lodged to stay the claim. The court will not, however, normally grant an open-ended stay for such purposes and if, for any reason, a lengthy stay is granted it will usually be on terms that the parties report to the court on a regular basis about their negotiations. Any order for a stay will normally include a provision that the parties may agree to extend the stay for periods not exceeding a total of 3 months from the date of this order without reference to the court, provided they notify the court in writing of the expiry date of any such extension. (See further, the Chancery Guide paragraphs 18.1 to 18.6).

Any request for a further extension after 3 months must be referred to the court. The order will include permission to apply in relation to the extension. At the end of the stay the parties should be in a position to tell the court what steps have been taken or are proposed to be taken.

Once the claim has reached the stage of trial directions being given, a stay for ADR may not be appropriate if a stay will interfere with the timetable of directions or there is no agreement about the optimum time for the stay to take place. The parties may need to be flexible about finding the best time for settlement discussions or mediation and to do so without a stay of the claim. The court will not make an order directing the parties to undertake a form of ADR. However, if the court considers that one or both parties are unreasonably refusing to attempt ADR, the court may order a stay with a direction for the parties to take reasonable steps to consider ADR.

CPR, r. 26.4 states,

‘(1)    A party may, when filing the completed directions questionnaire, make a written request for the proceedings to be stayed while the parties try to settle the case by alternative dispute resolution or other means.

(2)     If all parties request a stay the proceedings will be stayed for one month and the court will notify the parties accordingly.

(2A)   If the court otherwise considers that such a stay would be appropriate, the court will direct that the proceedings, either in whole or in part, be stayed for one month, or for such other period as it considers appropriate.

(3)     The court may extend the stay until such date or for such specified period as it considers appropriate.

(4)     Where the court stays the proceedings under this rule, the claimant must tell the court if a settlement is reached.

(5)     If the claimant does not tell the court by the end of the period of the stay that a settlement has been reached, the court will give such directions as to the management of the case as it considers appropriate.’

PD Paragraph 31 (Procedure for the parties to apply to extend the stay) states,

‘(1)    (a)     The court will generally accept a letter from any party or from the solicitor for any party as an application to extend the stay under rule 26.4.

(b)     The letter should –

(i)       confirm that the application is made with the agreement of all parties, and

(ii)      explain the steps being taken and identify any mediator or expert assisting with the process.

(2)     (a)     An order extending the stay must be made by a Judge.

(b)     The extension will generally be for no more than 4 weeks unless clear reasons are given to justify a longer time.

(3)     More than one extension of the stay may be granted.’

If one or both parties in litigation have acted unreasonably in refusing to use mediation to resolve their dispute, the court may mark its disapproval by making an adverse costs order.

CPR, r.3.1(2)(m) provides, ‘…the court may – take any other step or make any other order for the purpose of managing the case and furthering the overriding objective, including hearing an Early Neutral Evaluation with the aim of helping the parties settle the case.’ CPR, r.3.1(3) further provides, ‘When the court makes an order, it may – (a) make it subject to conditions… [and] (b) specify the consequence of failure to comply with the order or a condition.’ In other words to encourage a party to enter into ADR it may make a punitive costs order. The court will not make an order directing the parties to undertake a particular form of ADR. However, if a party has acted unreasonably in refusing to enter into ADR to resolve their dispute, the court may mark its disapproval by making an adverse costs order, see Blackstone’s, paragraph 73.23. CPR, r.44.4(3)(a)  (Factors to be taken into account in deciding the amount of costs) states that the court will have regard to, ‘efforts made before & during the proceedings to try to resolve the dispute’. Blackstone’s , paragraph 68.21 further states, ‘One of the circumstances in which the court may order one party to pay another party’s costs on the indemnity basis is where the court wishes to penalise the paying party for its misconduct in relation to the proceedings… The Court of Appeal has declined to set out principles on which the discretion to award indemnity-basis costs is to be exercised, beyond stating that an indemnity costs order will be appropriate where the facts of the case or the conduct of the parties removes it from the norm [including]: (b) where a party… has acted in such a way as deserves condemnation.’ In the author’s opinion, under CPR, r.3.1(3) the court’s armoury includes the making of an ‘unless order’.  Adverse costs orders have long been used as a means of compelling suitable litigation behaviour. In Halsey v Milton Keynes NHS Trust and Steel [2004], Lord Justice Dyson made it clear that the court can impose a costs sanction on a party who unreasonably refuses to mediate. More recently in PGF II SA v OMFS Company 1 Ltd [2013] EWCA Civ 1288, Lord Justice Briggs said:

‘The ADR Handbook, first published in 2013, after the period relevant to these proceedings, sets out at length at paragraph 11.56 the steps which a party faced with a request to engage in ADR, but which believes that it has reasonable grounds for refusing to participate at that stage, should consider in order to avoid a costs sanction. The advice includes:

a) Not ignoring an offer to engage in ADR;

b) Responding promptly in writing, giving clear and full reasons why ADR is not appropriate at the stage, based if possible on the Halsey guidelines;

c) Raising with the opposing party any shortage of information or evidence believed to be an obstacle to successful ADR, together with consideration of how that shortage might be overcome;

d) Not closing off ADR of any kind, and for all time, in case some other method than that proposed, or ADR at some later date, might prove to be worth pursuing.

That advice may fairly be summarised as calling for constructive engagement in ADR rather than flat rejection, or silence. It is apparent from the footnotes that the authors drew heavily on the first instance decision in the present case, to which I now turn.

Finally, as is recognised by the weight placed on the judge’s decision in the passage in the ADR Handbook to which I have referred, this case sends out an important message to civil litigants, requiring them to engage with a serious invitation to participate in ADR, even if they have reasons which might justify a refusal, or the undertaking of some other form of ADR, or ADR at some other time in the litigation. To allow the present appeal would, as it seems to me, blunt that message. The court’s task in encouraging the more proportionate conduct of civil litigation is so important in current economic circumstances that it is appropriate to emphasise that message by a sanction which, even if a little more vigorous than I would have preferred, nonetheless operates pour encourager les autres.’

The principles in Halsey v Milton Keynes General NHS Trust [2004] EWCA Civ 576, have also been directly expressed in procedural rules and extended further. For example, the PD – Pre-Action Conduct, allows the court to penalise a party who has not followed the requirements of the PD by forcing the payment of costs on an indemnity basis (PD – Pre-Action Conduct paragraph 16(b)).  In Garritt and Others v Ronnan and Solarpower PV Limited [2014] EWHC 1774 (Ch), His Honour Judge Waksman QC said, ‘To consider that mediation is not worth it because the sides are opposed on a binary issue, I’m afraid seems to me to be misconceived… The point is that you compare the costs of a mediation with the costs of a trial. And the costs of a mediation, on any view, would have been far less than the costs of the trial.’

As stated in Blackstone’s, paragraph 47.7, ‘By encouraging the parties to settle their dispute or resolve it outside the court system, and by forcing the parties into identifying the real issues at an early stage, case management conferences are a means of using court time to save more time.’

CPR, r.1.3 states, ‘The parties are required to help the court to further the overriding objective’), and Blackstone’s Civil Practice 2017 (‘Blackstone’s), paragraph 73.20 further states, CPR, r.1.3, which requires the parties to help the court to further the overriding objective, places the parties under a duty in relation to ADR. Practically, this will require the parties… to consider seriously the possibility of using it to resolve their dispute.’ Where there has been a persisitent breach of CPR, r.1.3 by a party, in the author’s opinion, when making an Order for the payment of any costs of an application by that party, following summary assessment at the end of a hearing, the court may mark its disapproval by making a punitive costs order for refusing to enter into ADR coupled with an unless order. In support of this argument Blackstone’s, paragraph 48.7, cites , ‘In Forrester Ketley and Forrester Ketley and Co v  v Brent [2005] EWCA Civ 270… it was held that the court below had been fully entitled to make unless orders, with striking out in default… where [a party] … (b) had failed to pay earlier interim costs orders.’

Strategy

‘To win one hundred victories in one hundred battles is not the acme of skill. To subdue the enemy without fighting is the supreme excellence.’ (Sun Tzu).

To defeat your opponent by strategic considerations, and not by force, you must be realistic and practical about the merits of your claim before issuing it. Subjective assumption and rash action lead to defeat. You have to deliberate on the basic conditions which decide a conflict.

The basic thesis of Sun Tzu’s ‘Art of War’ is to try to overcome the enemy by wisdom, and not by force alone. In a litigation context this translates as persuasion through the application of ‘wit and wisdom’ rather than ‘aggression’ and ‘threats’. As discussed in the ‘Conclusion’ below, this is linked to listening and respect, which can open the door to constructive dialogue.

Sun Tzu advocates the securing of an advantageous posture through diplomacy, which is also the idea of defeating your opponent by strategic manoeuvring. Where e.g. your opponent belligerently refuses to consider ADR, this could take the form of persuading your opponent through the judge at a CMC to agree to a stay for ADR to avoid incurring an adverse costs order coupled with an unless order, see the ‘Court’s powers’ above. Such an order could be linked to the ordering of costs of the application on a summary assessment at the end of a hearing, if e.g. your opponent has applied at the CMC to amend his particulars of claim.

Gaining the initiative in any confrontation is critical – you must bring your opponent where you want him to be, and not run after him.

‘The general who is experienced in war once in motion is clear in his destination and never bewildered; once he acts, his resources are limitless and tactics varied. Therefore, I say: know the enemy, know yourself, and your victory will never be endangered. Know the ground, know the weather, and your victory will be complete… If you know only yourself, not the enemy, your chances of winning and losing are equal. If you are ignorant of either the enemy or yourself , you will surely be defeated in every battle.’ Sun Tzu.

‘Now, an army may be likened to water, for just as flowing water avoids the heights and hastens to the lowlands, so an army should avoid strength and strike weakness. And as water shapes its flow in accordance with the ground, so an army manages its victory in accordance with the situation of the enemy. And as water has no constant form, there are in warfare no constant conditions. Thus, one able to win the victory by modifying his tactics in accordance with the enemy situation may be said to be divine. Of the five elements [water, fire, metal, wood, earth], none is always predominant; of the four seasons, none lasts forever; of the days, some are long some short, and the moon waxes and wanes. That is also the law of employing troops.’ Sun Tzu.

Psychology

‘People often think that establishing objective facts will resolve the dispute… yet in each situation, the key to the dispute is not objective truth but what is going on in the heads of the parties. Objective reality is unlikely either to be the cause of the problem or the source of a solution. Experience suggests that the two most helpful qualities in dealing well with differences are an ability to be persuasive and an ability to revise our own thinking in the light of fresh insights. More data – more facts and figures – merely contribute to our ability to be persuasive or to see a problem in a new way. They are not ends in themselves. To be persuasive, we need to understand how others see the world, their motivations, emotions, and aspirations. To see a problem in a new light, we need to analyze it from perspectives other than our own. In each case, our power depends on our ability to put ourselves in other people’s shoes and to see the world from their point of view. We often handle conflict poorly because we are each prisoners of our own thinking. We tend to judge differences, particularly when we think we know best. Understanding differences is hard work. Frequently we do not know how to go about it…Coping with conflict means coping with the way people think and feel. In any conflict people think and feel differently from one another, and the issue is not whose perceptions are ‘true’ and whose are ‘false’…The better we understand the way people see things, the better we will be able to change them. There is no magic formula for acquiring understanding. It takes a little time and effort.’ (‘Beyond Machiavelli – Tools For Coping With Conflict’, by Roger Fisher, Elizabeth Kopelman, and Andrew Kupfer Schneider

Principled negotiation

Interests

‘The basic problem in a negotiation lies not in conflicting positions, but in the conflict between each side’s needs, desires, concerns, and fears…which are interests. Interests motivate people; they are the silent movers behind the hubbub of positions. Your position is something you have decided upon. Your interests are what caused you to so decide…for every interest there usually exist several possible positions that could satisfy it. All too often people simply adopt the most obvious position… When you do look behind opposed positions for the motivating interests, you can often find an alternative position which meets not only your interests but theirs as well. Reconciling interests rather than compromising between positions also works because behind opposed positions lie many more interests than conflicting ones…a close examination of the underlying interests will reveal the existence of many more interests that are shared or compatible than ones that are opposed…How do you go about understanding the interests involved in a negotiation, remembering that figuring out their interests will be at least as important as figuring out yours. One basic technique is to put yourself in their shoes and ask yourself ‘Why?’If you do, make clear that you are asking not for justification of this position, but for an understanding of the needs, hopes, fears, or desires that it serves… Ask ‘Why not?’ Think about their choice. One of the most useful ways to uncover interests is first to identify the basic decision that those on the other side probably see you asking them for, and then to ask yourself why they have not made that decision. What interests of theirs stand in the way? If you are trying to change their minds, the starting point is to figure out where their minds are now.’ (‘Getting To Yes’ by Roger Fisher and William Ury).

The method

Principled negotiation produces wise agreements amicably and efficiently. The classic exposition of principled negotiation is ‘Getting to Yes’ by Roger Fisher and William Ury, who developed the methodology set out below.

  1. Don’t bargain over positions.
  2. Separate the people from the problem – i.e. concentrate of the substantive issues (what the clients want) rather than the interpersonal relationship (how they feel about each other).
  3. Focus on interests, not positions – i.e. negotiate to achieve a settlement which satisfies the parties’ real future interests and needs rather than who was right or wrong. Interests define the problem. Behind opposed positions lie shared and compatible interests, as well as conflicting ones. To identify interests:

(i)       ask ‘why?’;

(ii)      ask ‘why not?’ and think about their choice;

(iii)     realize that each side has multiple interests, and that the most powerful interests are basic human needs.

Talk about interests:

(i)       make your interests come alive;

(ii)      acknowledge their interests as part of the problem;

(iii)     put the problem before your answer;

(iv)     look forward not back;

(v)     be concrete, but flexible; and

(vi)     be hard on the problem, soft on the people.

  1. Invent options for mutual gain – i.e. analyse items being negotiated to see how they can be broken into parts and converted from ‘zero-sum’ to ‘multiple/integrative’ (the classic example given of two sisters arguing over an orange – they split it in two and only then realise that one wanted the peel and the other the fruit). Separate inventing from deciding. Broaden your options. Look for mutual gain by identifying shared interests; dovetailing differing interests; and asking for their preferences. Make their decision easy. Put yourself in their shoes.
  2. Insist on objective criteria – i.e. replace the subjective will or opinion of the parties with an independent standard against which to judge the settlement. Frame each issue as a joint search for objective criteria. Ask ‘what’s your theory?’ Agree on first principles. Reason and be open to reason, and never yield to pressure.
  3. Develop your BATNA (best alternative to a negotiated agreement) – i.e. rather than just looking at what your client ought to get out of the negotiation (with the inherent rigid and restrictive strategy of moving along a continuum of ‘opening position’ to a ‘bottom line’), consider what he or she will do if no agreement is reached (which gives you more flexible alternatives against which to measure proposals made in the negotiation).

If they won’t play use negotiation jujitsu. Don’t attack their position, look behind it. Don’t defend your ideas: invite criticism and advice. Recast an attack on you as an attack on the problem. Use questions instead of statements. Statements generate resistance, whereas questions generate answers. Questions allow the other side to get their points across and let you understand them. They pose challenges and can be used to lead the other side to confront the problem. Questions offer them no target to strike at, no position to attack. Questions do not criticise they educate. Use silence. If your opponent has made an unreasonable proposal or an attack you regard as unjustified, the best thing to do may be to sit there and not say a word. If you have asked an honest question to which they have provided an insufficient answer, just wait. People tend to feel uncomfortable with silence, particularly if they have doubts about the merits of something they have said. Silence often creates the impression of a stalemate which your opponent will feel impelled to break by answering your question or coming up with a new suggestion. When you ask questions, pause. Don’t take them off the hook by going right on with another question or some comment of your own. Some of the most effective negotiating you will ever do is when you are not talking.

Communication

‘Your manner or style of speaking can have a huge impact on how your message is received. Style is the manner of delivery, a person’s attitude and demeanour. A person’s style includes a range of factors such as use of language, tone and volume of voice and physical presence, e.g. the way of sitting or standing. Style can extend to particular types of statements (e.g. making personal remarks about the opponent or being sarcastic or condescending, all hallmarks of a competitive style). An argumentative style will produce a very different psychological reaction in the listener and this in turn may affect how the listener responds… [A] competitive negotiator may use an argumentative style to wear the opponent down. A co-operative negotiator may use non-threatening reasonable language to engender trust and reciprocity in their opponent… Non-verbal communication is the way we transmit information through our behaviour… An ability to understand what information facial expressions, hand gestures, or other movements of the body may be revealing assists a negotiator in a more effective way if the message is correctly read. Equally, being able to manipulate your own non-verbal behaviour can be very useful in a negotiation… You need to be aware of and be able to evaluate not only your opponent’s behaviour, but also your own, if you are to have any degree of control over a situation. This will assist you to learn what works, and why, and what does not work, and why. This information can only be gained through careful observation during the negotiation and critical reflection after the negotiation. One way of achieving such detachment is to mentally remove yourself from the negotiation and try to observe it critically as a non-partisan spectator.

To be persuasive, you need to ensure that your listener understands your words and attaches the same interpretation to them as you intend them to have. Being concise and precise in your choice of words will produce clear persuasive argument. Using too many words and being vague is not persuasive. The message loses impact because your opponent will have difficulty ascertaining what your argument is. He or she is also likely to misunderstand it… The manner in which you speak will also affect how persuasive you are. Speaking with confidence is as important in a negotiation as it is in the courtroom. Looking at your listener, taking care in your pronunciation, speaking at a reasonable pace, etc, will all increase your persuasiveness.

Negotiation is a process of information exchange that occurs on at least three different levels: the explicit spoken word, the ‘subtext’ or hidden message in what someone does not mention, and the non-verbal information conveyed… Listening effectively is essential to being persuasive given the intense levels of concentration required, particularly during a negotiation. You must be able to absorb and monitor what your opponent says and react to it appropriately. This involves digesting what is said as well as what is not said. Particular care should be taken when interpreting the ‘subtext’ of what is said. It may help to check your understanding with your opponent.

[Listening] is also a powerful tool in its own right. Often a persuasive negotiator will be marked out by his or her ability to make the opponent feel that what is being said is being heard. Contrary to the notion that nothing gains nothing, is used correctly, listening can do the opposite. Showing that you are paying attention and hearing what your opponent has said conveys a variety of positive messages to the opponent. It shows interest and commitment. It can inspire trust, respect, even honesty. It is also very reassuring for your opponent. All of which may help you to get what you want from a negotiation. However, unsubtle and deliberate ‘active listening’ may have a very destructive effect… One of the main obstacles to effective listening in a negotiation is your internal dialogue as you process the information received and consider what your next move should be. You will need to practice disciplining your own thoughts so that they do not preclude you from listening to important verbal and non-verbal messages which you may receive from your opponent.’ ‘Negotiation’ edited by Margot Taylor (The City Law School, City University London, Bar Manual).

Acknowledgment

‘Even if you disagree with the other person’s stance on an issue, you can acknowledge their reasons for seeing the world as they do. They might be motivated by strong feelings, a passionate belief, or a persuasive argument. Consider the situation Roger Fisher experienced whilst representing the Federal Government in front of the U.S. Supreme Court. He stood to make his arguments against the petitioner. Stepping forward he said, “The petitioner has a strong case. In fact I think it is stronger than the one made by counsel here this morning. If I had been arguing for the petitioner, I would have added the following point…”

“Mr Fisher!” Justice Frankfurter interrupted. “You are here for the Government!”

“Yes, Your Honor” Roger said. “And I want the Court to understand that we have an answer not only to the arguments that the petitioner has made but also to another good argument that I think the petitioner could make. Either way their case is not trivial or far-fetched. We believe this court was right to grant review and to consider this case on its merits as we in the government have. Despite the strength of their case, we have concluded that the law is against them for reasons that I will now present…”

Roger believed that by honestly expressing his appreciation for the merits of his opponent’s case, he was a more effective advocate for the Government than if he had squared off, contending that the petitioner’s arguments were absurd and should be dismissed out of hand. Having demonstrated a thorough understanding of the other side’s case – and directly answering it – his argument was likely to be more effective than if he simply avoided their contention and made an argument of his own. The Government won the case…Finding merit in another’s reasoning requires that you actually do see merit in it. Sincerity is crucial. It is your honest valuing of another’s perspective that makes them feel appreciated. You want to express that you understand the basis for why they feel, think, or act the way they do. While you may struggle to find value in what they say or do, look hard and imagine what their emotional experience is like, considering what concerns may be motivating their emotions. When you strongly disagree with others, try acting like a mediator. The hardest time to find merit in another’s point of view is when you are arguing about an issue that may be personally important. Listening for merit in another’s point of view can transform the way you listen… The third element of expressing appreciation is to demonstrate your understanding of the merit you have found. Once you understand their perspective and find merit, let them know…What is important is that the person’s thoughts, feelings, or actions are recognised and acknowledged…Reflect back what you hear…Others are likely to feel unheard unless you demonstrate to them that you do in fact understand what it is that they believe is important.’ (‘Building Agreement’, by Roger Fisher and Daniel Shapiro).

Mediation

The keys to success in mediation are not what lawyers argue, but identification by each party of their BATNA (best alternative to a negotiated agreement), which is a practical tool for risk management, and doing a deal measured against it. This requires preparation and planning by each party’s mediation advocate. Strategy is the outcome. ‘A collaborative strategy assumes that the parties can work together to reach an agreement that meets the needs of both and is objectively fair. The process involves exploring the parties’ underlying interests, sharing information and being creative in the options considered. The agreement will not necessarily focus on the original issues between the parties but will try to identify options for mutual gain. The strategy involves more than co-operation – it is based on mutual effort and requires advance analysis and planning.

Within the term ‘collaborative’ different strands may be identified:

  • a ‘principled’ strategy tries to achieve an outcome that is objectively fair against some external authoritative norm; and
  • a ‘problem-solving’ strategy focuses on both parties’ real needs and interests, and tries to get a practical solution without building costs.’ (‘A Practical Approach to Alternative Dispute Resolution’, by Susan Blake, Julie Browne & Stuart Sime).

The characteristic approach is:

  1. working together is stressed at the start of the negotiation, and this approach is sustained throughout. A mediation advocate may for example open by saying,Thank you for meeting with us today.I will be corrected if I am wrong, but what I think you say about the facts and the law is …It is not my job to persuade you that your arguments will not succeed at trial.As you know we say that we will succeed.I am not interested in having an argument with you about whose view is right.I suggest that litigation is not going to be a great outcome for either you or my client. The risks are…I am here because I believe that we can reach a principled and fair deal that is not only good for my client but also better for you.I hope that you will work with me to achieve this today;
  2. each issue is approached constructively, focussing on the best possible outcome for both parties;
  3. issues are likely to be approached from the point of view of needs, interests and options, rather than fault and blame;
  4. both sides work to maintain an open and reasonable atmosphere; and
  5. the mediation advocates are likely to emphasise objectivity, and a potential settlement is often judged against agreed criteria to test fairness.

‘In addition to planning potential demands and concessions in relation to individual issues, it is vital to be able to put any personal settlement into an overall context, so that you will be in a position to judge whether a particular overall set of terms should or should not be accepted. This requires comparing whatever overall deal you are able to achieve in a negotiation with the best realistic alternative there would be if no settlement were reached. This involves identifying the best alternative to a negotiated agreement (‘BATNA’). If the deal you have negotiated is at least as good as your BATNA then it should potentially be accepted. If it is worse then you should probably walk away.’ (‘A Practical Approach to Alternative Dispute Resolution’, by Susan Blake, Julie Browne & Stuart Sime).

For a legal negotiation the alternative to settlement will be going to court, so the BATNA is what the client is realistically likely to get if he were to go to court.

Barrister Assisted Mediation

I innovated this technique in January 2014, and the following extract is from my new book the ‘Contentious Probate Handbook’. This method of mediation could also take the form of a co-mediation.

“Where a mediator does not have an adequate technical knowledge of the legal issues underpinning a contentious probate dispute, an independent barrister is jointly appointed by the parties as a consultant to help the mediator understand the facts, evidence, technical issues in dispute and applicable legal principles. Prior to the mediation day the barrister can also provide each party with a preliminary:

(i)       analysis of legal merits;

(ii)      commercial analysis;

(iii)     litigation risk analysis; and

(iv)     proposed settlement methodology (i.e. a mathematical equation).

The aim ahead of the mediation day is to create a framework for negotiations, to move the parties away from a positional to a legally principled and commercially rational mindset, leading to traction within the first two hours of the mediation day and the making and discussion of settlement proposals by each party through the mediator before lunch.

Alternatively the barrister could provide these documents to the mediator for discussion in confidence with him in a pre-meeting to assist the mediator to develop bespoke mediation strategies in advance of the mediation day.

This would of course require the disclosure by each party to the barrister and mediator of a bundle (which could be limited to one lever arch file of indexed documents) at least two weeks before the mediation day.

The barrister is instructed directly by each party, does not have a contract with the mediator, and signs the mediation agreement. Each party will be represented by their own mediation advocate throughout the mediation day. The barrister (whose duty is to assist the mediator) can with the permission of the mediator also be consulted to provide his preliminary opinion (without legal liability) about legal issues. In which case the contract with the barrister will contain an indemnity.

To help the parties develop a road-map for settlement, if the contract with the barrister and mediation agreement include a provision requiring terms of settlement to contain a clause obliging the parties to keep negotiations confidential following agreement, then a barrister is set free to think outside the box and make creative proposals (for communication through the mediator).  Instead of preparing position statements, each party with the assistance of the barrister can prepare (in modular Scott Schedule format) a side by side analysis of the facts, issues, and governing legal principles, for exchange together with a bundle of documents (also to be provided to the mediator) in advance of the mediation day.

The author’s theory is that on the mediation day each party will then (depending upon preparation and trust), be equipped to move swiftly (i.e. in the first 2 hours) from a fixed starting point, and be open to working with each other through the mediator (and his assisting barrister), to develop a practical and fair settlement using bespoke methodologies suggested by or jointly developed through the mediator with the assistance of the barrister.

Following a 5 to 10 minute open plenary and house-keeping session, in which only the mediator speaks, each party can then head off to their own respective rooms to be visited by the mediator and barrister, to discuss and explore their strategic interests positions and reasons, in privacy and confidence.

The objective of ‘Barrister assisted mediation’, is to kick-start a road mapping process in the morning, that can result in the making of proposals through the mediator, leading to an agreed formula for settlement in the afternoon.  Even if an overall settlement is not achieved before 5.30pm, because the process is likely to result in greater clarity and focus, this method is likely to reduce the issues in dispute and create a road-map leading to an agreed formula for settlement on another day.

It also sets the mediator free from the outset to make the maximum use of his skills in the time available in the morning, to explore with each party their respective underlying interests values and positions, with the aim of agreement being reached in the afternoon.”

Early Neutral Evaluation (‘ENE’)

In relation to judicial ENE, the Chancery Guide 2016 (published 17 February 2016) confirms that in appropriate cases and with the agreement of all parties the court will provide a non-binding, early neutral evaluation (ENE) of a dispute or of particular issues (see CPR rule 3.1(2)(m)).

‘18.7 ENE is a simple concept which involves an independent party, with relevant expertise, expressing an opinion about a dispute or an element of it. It is unlike mediation because a mediator acts primarily as a facilitator. Although the mediator may undertake some ‘reality testing’, there is no requirement to do so. The person undertaking ENE provides an opinion based on the information provided by the parties and may do so without receiving oral submissions if that is what they wish.

18.8 An essential feature of ENE, apart from being consensual, is that unless the parties agree otherwise, the opinion is non-binding and the process is without prejudice (it being treated as part of a negotiation between the parties).

18.9 ENE is offered in the Chancery Division by all judges. The judge providing the ENE may be a full time Chancery judge, a section 9 judge, Chancery Master or Registrar. The ENE may be conducted by a judge of the same level as would be allocated to hear the trial, but need not be if the parties agree otherwise.

18.10 There is no one case type which is suitable for ENE. In many cases mediation will remain the preferred form of ADR. Although ENE may be unsuitable for multi-faceted complex claims, if a particular issue lies at the heart of the claim an opinion could help unlock the dispute in a way which a mediator cannot. It is particularly suitable where the claim turns on an issue of construction, an issue of law where there are conflicting authorities or where the case involves the court forming an impression about infringement of intellectual property (“IP”) rights.

18.11 The Chancery Division does not have set procedures for ENE. The judge who is to conduct the ENE will give such directions for its preparation and conduct as he considers appropriate. The parties may consider that the judge will be in a position to provide an opinion about the claim or an issue based solely upon written position papers provided by the parties and a bundle of core documents. In many cases, however, it will be preferable for there to be, in addition, a short hearing of up to half a day. The opinion of the judge will be delivered informally.

18.12 Two important points which need to be addressed are as follows:
(a) The norm is that the ENE procedure and the documents, submissions or evidence produced in relation to the ENE are to be without prejudice. However the parties can agree that the whole or part of those items are not without prejudice and can be referred to at any subsequent trial or hearing.
(b) The norm is that the judge’s evaluation after the ENE process will not be binding on the parties. However the parties can agree that it will be binding in certain circumstances (e.g. if not disputed within a period) or temporarily binding subject to a final decision in arbitration, litigation or final agreement.
18.13 Assuming the ENE is without prejudice and not binding, the court will not retain on the court file any of the papers lodged for the ENE or a record of the judge’s opinion.

18.14 In any event the judge will have no further involvement with the claim, either for the purpose of the hearing of applications or as the judge at trial, unless both parties agree otherwise.’

A specimen draft order directing ENE is set out in paragraph 18.15.

Chancery FDR

Paragraphs 18.16-18.18 of the Chancery Guide 2016 outline ‘Chancery FDR’ which is, ‘a form of ADR in which the judge facilitates negotiations and may provide the parties with an opinion about the claim or elements of it.’

Paragraph 18.17 states that the key elements of Chancery FDR are:

• It is consensual. The court will not direct Ch FDR unless all the parties agree to it.
• There will be a Ch FDR ‘hearing’, although it is quite unlike any other type of hearing. It is better described as a meeting in which the judge plays the role of both facilitator and evaluator.
• Ch FDR is non-binding and without-prejudice. The court will try to lead the parties to agree terms but cannot make a determination.
• It is essential for the parties, or senior representatives in the case of corporate parties, to be present.
• The court will carefully set up the Ch FDR meeting by giving directions which will help it be a success. This may include directing the parties to exchange and file without prejudice position papers (and direct what is to be addressed) and to lodge a bundle. If there is an issue which can only be resolved with expert evidence a way may be found to obtain that evidence without commissioning CPR compliant reports.
• When the meeting takes place the parties are directed to attend before the meeting starts so they may hold initial discussions. The parties are then called in before the judge. The Ch FDR meeting is a dynamic process which has some similarities with an initial mediation meeting. If the parties request it the judge may express an opinion about the issue or the claim as a whole.
• The court will not retain any papers produced for the meeting or any notes of it.
• The judge who conducts the Ch FDR meeting has no further involvement with the case if an agreement is not reached.

There is no one type of case which is suitable for Ch FDR. The origins of FDR lie in money claims in Family cases. It has been widely used in claims under the Trusts of Land and Appointment of Trustees Act 1996, inheritance and partnership claims. It is likely to have most application to claims in which there is strong animosity and/or a breakdown of personal or business relationships and trust disputes. In principle Chancery FDR is now available in any contentious probate claim. It can also be bolted on to the method of ‘Guided Settlement’ I innovated last year (published in my article ‘The Advocate and the Expert in a Testamentary Capacity Claim’) to which there is a link at the top of this page.

As current room hire rates in the Rolls Building are:

£100 for a small room (i.e. to accommodate 6 people);
£150 for a medium sized room (i.e. to accommodate 12 people); and
£200 for a large room (i.e. for a plenary session),

depending upon the court fee (which at the time of writing is not known) this may become a cost-effective alternative to conventional mediation, which enables a hybrid form of ADR to take place involving a judge, at the Rolls Building, or outside London in a Chancery District Registry.

Guided Settlement

I innovated this technique in April 2015, and the following extract is from my new book the ‘Contentious Probate Handbook’. I am currently researching and writing a new article for publication later this year entitled, ‘Mediation of Trade Disputes’, which will discuss the use of this method in the settlement of a trade dispute, and the corresponding dispute resolution provisions to include in a trade agreement.

“Another ADR method, recently innovated by the author, is ‘Guided Settlement’. This process has its roots in both ENE and mediation, but is neither because the settlement ‘Guide’ (e.g. a neutral Barrister TEP jointly appointed by the parties in a contentious probate, trust, or Inheritance Act claim) neither:

(i)       determines any issues; nor

(ii)      acts as an evaluative mediator.

The role of the Guide (as a technically proficient specialist practitioner and creative commercial problem solver) is to:

(i)       analyse the legal merits of the claim and inherent litigation risks;

(ii)      design a commercial settlement methodology; and

(iii)      help the parties to communicate, so that they can use the methodology (with crunched figures based upon independent asset valuations) as a framework to explore and construct overall terms of settlement.

Throughout the process the Guide thinks freely (including outside the box) and generates creative solutions, i.e. acts as a neutral creative problem solver who has no partisan loyalties or personal stake in the dispute.

In e.g. a probate dispute, the basic procedural steps are as follows:

(i)       the parties (through their solicitors) obtain and jointly pay for an inventory and valuation of the estate assets, i.e. to determine the size of the estate pie (Valuations’);

(ii)      the solicitors acting for each party take instructions from their respective clients about their own commercial needs preferences and priorities (a ‘Commercial analysis’);

(iii)      instead of appointing a mediator the parties jointly appoint a Barrister TEP to act as a settlement ‘Guide’, who:

(a)      undertakes a fixed fee preliminary evaluation of the legal merits of the claim, litigation risks, and costs, and sets out his conclusions in the form of a grid/schedule, i.e. a legal risk analysis (‘LRA’); and

(b)      develops a commercial / arithmetical (i.e. number crunched) methodology for settling the dispute based upon the:

–         Valuations;

–         Commercial Analysis provided by each party’s solicitor; and

–         LRA,

(the ‘Settlement Framework’), which is circulated by e-mail amongst the parties before they meet to settle the claim.

(iv)     In a fixed-fee meeting (e.g. of up to one day), the parties’ solicitors, with or without their clients in attendance, and with full authority to settle or access to instructions over the telephone, meet with the Guide to explore and construct overall terms of settlement. The meetings take place in separate rooms in a neutral venue, e.g. at the Barrister’s Chambers.

(v)      Using the Settlement Framework, the Guide works with each party to jointly generate settlement proposals to:

(a)      reduce the issues in dispute (i.e. remove them from the claim equation); and

(b)      create momentum, leading to an overall deal.

Like mediation this may require more than one meeting.

(vi)     Unlike a mediator, the Guide uses his technical knowledge of the legal issues in dispute and problem-solving skills to create inventive settlement proposals for which neither side will lose face if rejected, i.e. because they are the Barrister’s ideas, and if agreed, can be claimed and owned as the product of a joint commercial collaboration between the parties.

Where Guided Settlement is entered into following the instruction of experts, the steps would need to be modified to enable the Guide to receive expert reports before developing a Methodology. If experts have not been appointed, the parties could agree upon the appointment of a single joint-expert to assist the Guide.”

Conclusion

I had the great privilege of meeting with the late Professor Roger Fisher for two hours in his study at Harvard Law School during an academic visit from King’s College London in 2002, and his parting advice was,

‘Appreciate their point of view:

  • understand it – it’s very important to appreciate the way they see it,
  • even if you don’t agree, say that it merits serious consideration, don’t say that they are wrong.

Appreciate their self-esteem.

Acknowledge that the other person has been heard.

Be prepared to argue their case better than they can before you answer it.’

These remarks by the late Professor Fisher serve to demonstrate that the recipe for success in resolving a dispute is a mixture of:

  1. technical mastery of the facts, law, and procedure obtained through granular forensic analysis and case preparation; and
  2. human psychology, in order to persuade.

The art of persuasion is the metier of the advocate, who throughout the litigation process must keep one eye on a diplomatic solution achieved through negotiation. In the end most cases settle, and the ability of a practitioner to develop and patiently achieve a practical consensus upon terms of settlement is only limited by his imagination, instructions, and authority.