1) Pre-action steps

Question 1

Costs sanctions

Answer 1

Imposed by court if you don’t participate in ADR

Question 2

When should ADR be used?

Answer 2

ADR should be used unless:
1) It is obviously inappropriate e.g because an injunction is required
2) The other party is unlikely to co-operate in the process
3) The other party cannot be trusted to comply with an award

Question 3

Mediation - Definition

Answer 3

The parties will agree an independent third person/body who will act as a go-between known as a mediator. They will be sent written statements from both parties and thereafter will discuss the case with them on a without prejudice basis.
Propose it to O/S by letter or email.

Question 4

Mediation - Advantages

Answer 4

• Cost and speed.
• Flexibility - parties can choose the procedure to be followed.
• There are no legal requirements
• Privacy - Preserves a business relationship
• Commercial reality - e.g discounts on future orders

Question 5

Mediation - Disadvantages

Answer 5

• There are occasions where mediation is simply not appropriate such as where the client needs a ruling on a point of law or if an injunction is required.
• Disclosure - risk that the parties may resolve the dispute without knowing all the facts leading to an unjust decision.
• Privacy - if they want their reputation fixing

Question 6

Mediation - What happens if they reach a decision?

Answer 6

Even if an agreement is reached it is not automatically binding. However they can get a Tomlin Order which is a consent order that allows parties to agree on terms to settle a dispute keeping terms confidential in a separate schedule

Question 7

Arbitration - Definition

Answer 7

It is a substitution for litigation and once a party has agreed to be subject to it they cannot take advantage of the normal court processes.

Question 8

Arbitration - When does it arise?

Answer 8

1) Contractually bound. Many business contracts contain a clause requiring the parties to submit to arbitration in the event of a dispute. E.g shipping or construction
2) Might agree to arbitration once a dispute has arisen

Question 9

Arbitration - Procedure

Answer 9

Dispute referred to independent arbitrator.
Process will be adopted but it will be less formal than court.
Once arbitrator has reached a decision it is binding

Question 10

Arbitration - Advantages

Answer 10

• Cheaper and quicker
• Less formal.
• Privacy
• Solutions are more practical
• Binding

Question 11

Arbitration - Disadvantages

Answer 11

• Might not receive the depth of investigation it would receive in the courts.
• Certain remedies such an injunctions are not available.

Question 12

Arbitration - Enforceability

Answer 12

Winning party can apply to high court for permission to enforce arbitration award

Question 13

Litigation - Definition

Answer 13

If the parties either cannot or will not engage in ADR then they will have to proceed by way of litigation through the courts. Once done so neither party can withdraw without paying the opponents costs. If the parties are unable to negotiate a settlement the court will impose its own solution that may be enforced by the successful party.

Question 14

Judges - District judges

Answer 14

Deal with majority of interim applications and they have jurisdiction to hear trials where the amount involved does not exceed £25,000

Question 15

Judges - Circuit judges

Answer 15

Trials In county court for amounts in excess of £25,000.

Question 16

Judges - High Court judge

Answer 16

Trials in high court for amounts in excess of £25,000

Question 17

Pre-action protocols

Answer 17

Set of guidelines that outline the steps parties should take before starting civil legal proceedings.The parties must establish what issues are in dispute, share info. that is available to them concerning these matters and endeavour to resolve the issues (ADR).
Immediately after collecting sufficient evidence to substantiate a claim, the potential claimant should send the defendant a letter details the claim. This letter must contain info. about the claimant, a brief outline of the claimant’s grievance against the professional and if possible a general indication of the financial value of the potential claim. The defendant sends a letter of response and/or letter of settlement within 14 days in a straightforward claim and 3 months in a complex one.

Question 18

Pre-action protocols - Debt claims

Answer 18

Does not apply for business to business debts. The potential claimant must give full information on the debt owed, including an up-to-date statement of account with details of interest and charges, and how the debt can be paid. The standard Reply Form, Information Sheet and Financial Statement forms that are annexed to the protocol should also be included. Debtors have 30 days to respond

Question 19

Pre-action protocols - Professional Negligence

Answer 19

Notify the professional in writing. This Preliminary Notice contains information about the claimant, a brief outline of the claimant’s grievance against the professional and, if
possible, a general indication of the financial value of the potential claim. The professional should be instructed to inform their insurers immediately and to acknowledge the notice in
writing within 21 days of receipt. Next, the claimant should write a Letter of Claim giving full details of the issues and attaching key documents. The professional must acknowledge this in writing within 21 days of receipt.
Thereafter, they have three months to investigate and to respond. The letter of response sets out whether they admit the allegations and if not why with documents.

Question 20

Commencement of the claim

Answer 20

Proceedings are commenced by a claim form which must be served on the defendant together with full details of the claim called particulars. If the defendant wants to contest the claim they are required to file at the court and serve on the claimant a defence. The court will allocate the matter to a track.