Should pre-action protocols include a mandatory good faith obligation to try to resolve and narrow the dispute? That is one of the questions posed in the Civil Justice Council (“CJC”) Review of Pre-action Protocols Interim Report published on 15 November (the “Interim Report”). 

The CJC is responsible for making policy recommendations about the future direction of civil justice in England & Wales and the Interim Report coves a range of issues across civil litigation. Other eye catching proposals include introducing a requirement to complete a joint stocktake report/list of issues as a final step before the start of proceedings and making all pre-action protocols (“PAPs”) available online via portals.

The CJC published its report on Compulsory ADR in July this year. In it, the CJC confirmed its view that compulsory ADR is both legal and desirable. It was welcomed by the Master of the Rolls who has said ADR should no longer be viewed as “alternative” but as an integral part of the dispute resolution process.

The Interim Report refers back to that report but does not develop the idea of compulsory mediation. Instead it suggests that “by converting the encouragement of ADR backed with the threat of (costs) sanctions, into a good faith obligation to try and resolve the dispute …could provide greater clarity to the parties about the nature of the obligation to engage in appropriate dispute resolution efforts”. 

In commercial disputes, the boundaries of pre-action conduct are reasonably well known and clear, with the risk of costs sanctions for non-compliance and unreasonable refusals to mediate. However duties of good faith, whilst well known in civil law jurisdictions are less well known here and an undeveloped area of our law. There must be a real risk that introducing a duty of good faith would, far from providing greater clarity, create uncertainty and additional cause for argument.

Whilst introducing a requirement to complete a joint stocktake report/list of issues as a final step before the start of proceedings is a good idea in theory, it may not be achievable in practice in many commercial cases. It can be difficult enough to agree a list of issues on the run up to a CMC where the parties have the benefit of pleaded cases to refer to. It is likely to be much more difficult in commercial cases where the position is often fluid and evolving.

Making all pre-action protocols (“PAPs”) available online via portals, so that they are easier to use, or encouraging the creation of portals that incorporate PAPs in their processes allowing compliance simply by following the on-screen instructions seems a sensible idea and sits well with the HMCTS Reform programme and the drive to modernise the practice of litigation, harnessing technology.

The proposals are out for consultation which closes on Christmas Eve. We will have to see what policy recommendations come from the CJC following the consultation but it certainly feels as if change is in the air.

[CJC Review of Pre-Action Protocols – Interim Report Nov 2021]