THE EFFECT OF COVID-19 ON THE COURT SYSTEM:  DISPUTE RESOLUTION WITHOUT THE COURTS?*

6 April 2020

Are you contemplating instructing lawyers to issue a claim, for example for the recovery of money, copyright infringement, unfair dismissal, breaches of your lease or another commercial or civil matter?  Have you recently been served by the Court or a claimant with proceedings against you?

This note provides an overview of the response of the civil divisions of the High Court, the County Courts and the Tribunals of England and Wales to the Covid-19 (Coronavirus) pandemic and the way in which you might choose to resolve your disputes by other means in the new environment.

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We are currently facing unprecedented circumstances. Although this briefing note is intended to give you an overview of commercial landlords and tenants positions, your circumstances may require bespoke advice.

We have put in place contingency plans so that we continue to stand ready to assist you even notwithstanding the stringent health measures now put in place by government.

If you have any questions or concerns about the issues raised below or by your situation, please contact our office on 020 7034 4200 or at disputeresolution@streathers.co.uk.

How are the Courts responding?

Judiciaries across the world have shown themselves committed to maintaining access to justice insofar as it is compatible with health guidance designed to combat the Coronavirus pandemic.

England and Wales is no different.  The government classifies workers in the justice system as key workers; judges continue to find ways to adapt the existing rules governing the conduct of litigation – the Civil Procedure Rules (CPR) – to accommodate the new circumstances and Courts and Tribunals remain open for business.

The response is wide-ranging, as a snapshot of recent updates to the CPR shows:

• On 25 March 2020, leading lawyers, Sir Terence Etherton (Master of the Rolls) and Robert Buckland QC (Lord Chancellor) bestowed on the Courts wide-ranging powers to hold a remote or virtual hearing. In addition, any party seeking to appear by videolink, such as a witnesses who can no longer travel, may now request that facility, rather than having to make an interim application for it as would customarily be required.

• On 27 March 2020, CPR PD 51Z was updated to reflect the moratorium on residential possession proceedings as a result of the Coronavirus Act 2020.

• On 2 April 2020, the Master of the Rolls and the Lord Chancellor also introduced an altogether new practice direction in the CPR, CPR PD 51ZA, that permits the parties to litigation to extend times set by the Court for taking any step in litigation without notifying the Court from 28 to 56 days to reflect the difficulties the Coronavirus pandemic poses. This provision will remain in place until 30 October 2020.

What does the Court’s response mean in practice?

The High Court has embraced virtual hearings.  Their preferred platform for holding a virtual hearing is Skype for Business® and a judge and up to four participants can be accommodated.  Proceedings cannot, however, be recorded, but it is hoped that the facility to do so will soon be available.

The High Court is also actively collecting feedback from participants in early virtual hearings in order to assess the extent to which it can accommodate longer trials already scheduled and improve its facilities.

In the County Courts and the Tribunal system, the picture is less unified.  Generally:

• County Court judges are taking a case-by-case approach, deciding how to deal with the need for telephone or virtual hearings as the need arises, and parties are encouraged to co-operate to formulate appropriate measures to facilitate that.

• In the eight Tribunals of England and Wales (Property, Employment, Immigration and Asylum, Tax, General Regulatory, Health, Education and Social Care and War Pensions ) the picture also varies.

• In the Employment Tribunal, Tribunal Judge Brian Doyle has highlighted the capacity of the rules to accommodate virtual hearings and the duty of cooperation on the parties in guidance dated 18 March 2020. By contrast, in the Property Chamber, London Region Judge Timothy Powell implemented a general adjournment of two months in all but urgent matters on 19 March 2020.  All timetables are now suspended until after 29 May 2020.

All Courts and Tribunals will continue to make decisions on the papers, where possible, as has always been the case.

Is there an alternative to proceedings in open Court?

Whether or not you are contemplating or are already involved in ongoing proceedings, the CPR makes it a duty of any party to a dispute at all times to consider alternatives to litigation in open Court, and has always done so even before the Coronavirus pandemic.

As a result, it is always possible to approach individuals or business with whom you are in dispute and propose any of the following at any time:

• A remote mediation by video conference or telephone;

• A remote arbitration by video conference or telephone;

• Expert determination, either on paper or by video conference or telephone; or

• Early neutral evaluation.

If you are a party to ongoing proceedings and you make an invitation to other parties to agree to any one of these alternatives, a judge may order that your opponent pays a portion of your costs – even if they succeed at trial – if they unreasonably refused to take up your invitation.

How do alternative forms of dispute resolution work?

Unless you are obliged to follow an alternative dispute procedure by a contract or document at the heart of your dispute, the emphasis is on co-operation between the parties.

In outline, some key characteristics of each of them are set out below.  You should, however, seek advice before considering proposing any of them.

Mediation:  the parties appoint an independent, suitably-qualified third party mediator to facilitate private dispute resolution.  The parties usually share all costs of the mediation equally, and, if there are proceedings, agree that they may recover the costs of an unsuccessful mediation if they later win at trial.  Mediators increasingly offer the ability to hold mediations of half a day, a whole day or several days virtually.  They can hold joint sessions with all the parties, or meet separately with the parties, or the parties’ lawyers in case that helps broker settlement.  The outcome is usually only binding once written up in a settlement agreement, but everything that happens at a mediation remains confidential to the parties and cannot prejudice their position in ongoing proceedings.

Arbitration:  is an alternative form of adjudication.  Parties sometimes agree to arbitrate disputes in a contract, or they can agree an ad hoc mediation if a dispute arises and there is no such arbitration provision in place.  There are many bodies offering arbitration frameworks, including the London Court of International Arbitration and the Centre for Effective Dispute Resolution.  Each has its own set of rules the parties must follow, but an arbitration tribunal can sit virtually in the same way as the Courts, but with greater freedom as to the technology used.  Arbitration is nearly always conducted confidentially, and if there is any question of law to determine, an arbitration judge may refer to the Court for assistance.

Expert Determination:  where parties have a technical dispute such as, for example, the interpretation of a lease or interpretation of a company constitution they may agree to appoint an expert to resolve the uncertainty in an expert determination.  The procedure is private and the expert’s decision is binding.

Early Neutral Evaluation:  If your dispute has reached an impasse, there is a gulf between the parties’ positions or confidentiality is an issue in a dispute in its early stages, you may wish to consider agreeing an early neutral evaluation.  The parties either appoint an impartial evaluator such as a barrister or refer the matter to the Court using provisions in the CPR.  The evaluator or judge will then give a provisional but authoritative assessment of the merits of each parties’ case.  This may assist in facilitating settlement or narrowing the dispute between the parties before full-scale litigation begins.

Streathers Solicitors LLP

6 April 2020

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*The Briefing Note reflects the position as at the date of publication. The information in this Briefing Note is not intended to amount to legal advice to any person on a specific matter or case. You are advised to obtain specific, personal advice from us about your case or matter and not rely on this Briefing Note.