Move to make mediation mainstream

It is now clear courts have the power to order parties to engage in mediation or another form of Alternative Dispute Resolution (ADR).

The Court of Appeal’s landmark decision in James Churchill v Merthyr Tydfil County Borough Council, combined with the government’s announcement to integrate compulsory mediation for some claims in the County Court, means the field of dispute resolution is changing.

The Churchill case highlighted parties need to actively consider alternate dispute resolution options before taking claims to court, a move signalling how mediation is becoming more mainstream.

Commercial litigator Mike Doherty, a qualified mediator at Sheffield’s Wake Smith Solicitors and an Associate Member of the Civil Mediation Council, looks at how the changes significantly impacted the way civil court disputes are planned, progressed and resolved.

This article covers:

• The landmark case
• When would such an order be made?
• Compulsory mediation in County Court claims
• Cost effective solutions – your next move

The landmark case

Churchill v Merthyr Tydfil Council – November 2023

James Churchill made a claim against his Welsh local authority after discovering Japanese knotweed in his garden.

Merthyr Tydfil Council argued Mr Churchill should have explored non-court dispute resolution options such as its internal complaints process before taking legal action.

The key question was whether the Court actually had the power to order a stay in proceedings and effectively require parties to attempt non-Court Dispute Resolution.

The Court of Appeal reconsidered the comments of Dyon LJ’s comments in the case of Halsey v Milton Keynes General NHS Trust [2004], which had indicated parties could not be forced to engage in mediation. The Court of Appeal deemed these remarks were obiter and therefore not binding on lower Courts.

The Court of Appeal essentially found that Courts have the power to order parties to engage in mediation or another forms of alternative dispute resolution (ADR) and have the power to stay proceedings to facilitate ADR between the parties.

When would such an order be made?

The Court of Appeal determined the Courts have the power to halt a claim, or compel parties to go through non-court dispute resolution options, as long as this would be compliant with Article 6 of the European Convention on Human Rights. It must not impair a Claimant’s right to proceed to a judicial hearing and be proportionate in the context of settling the dispute.

If ordering parties to mediate, the Court should consider:

• the cost to mediate, and the financial situation of both parties
• the urgency of the matter
• whether the case is suitable for mediation
• if both parties are legally represented
• why a party may refuse to mediate and what order to make if they unreasonably refuse to do so.

In future, courts may impose more costs orders where parties refuse to engage in ADR.

Compulsory mediation in County Court claims

Judicial developments have propelled the UK government's plans to introduce compulsory mediation for all small claims in the county courts, covering claims up to £10,000, which could divert around 20,000 cases annually from the court system.

Parties to many small claims disputes are now required to attend a mediation through the HMCTS Small Claims Mediation Service (SCMS). This free, one-hour, integrated mediation session is designed to resolve the case efficiently and with little, to no, cost.

Cost effective solutions – your next move

Do you have an existing commercial dispute that needs resolving? Find out how Wake Smith Solicitors can help your company

For further information contact Mike Doherty at Wake Smith Solicitors on 0114 224 2048 or email [email protected] 

Find out more about commercial mediation

Publised 29/04/25