Dispute Resolution - Settlement and Interim Applications

Question 1

Settlement

A settlement concluded after proceedings are issued should be recorded in a …

Why?

IMPORTANT

Answer 1

court order (or judgment).

So that enforcement proceedings to recover sums due under the settlement (including costs) can be commenced if either party does not honour it.

Question 2

Settlement

If a party wants to settle without an application to the court, what should they draw up?

In what circumstance is this not available?

In practice, the proposed order would only be referred to a judge where…

IMPORTANT

Answer 2

A consent order (or judgment for sealing by court officer).

Where either party is a litigant in person.

…it appears to be incorrect or unclear.

Question 3

Settlement: Consent order formalities

A. What are the three formalities for a valid consent order?

B. What are two things to keep in mind in relation to the terms?

IMPORTANT

Answer 3

A. It must be:
- drawn up in the terms agreed by the parties;
- expressed as being “By Consent”; and
- signed by the legal representative acting for each party.

B. Terms

• Only terms within the court’s powers may be agreed (e.g. payment of a sum of money).
• The terms are open to public inspection.

Question 4

Settlement: Tomlin Order

When should a Tomlin Order (a special form of consent order) be used?

What are the effects of a Tomlin Order?

The key to an effective Tomlin Order is to appreciate that…

IMPORTANT

Answer 4

If the parties want any terms to be confidential and/or to be beyond the powers of a court to order.

It stays the claim on agreed terms that are set out in a schedule (or separate document).

certain terms must be in the order itself, while others can be set out in a schedule.

A correctly drafted Tomlin order will be brief and straightforward.

Question 5

Settlement: Tomlin Order

What four terms must be in the order itself?

Answer 5

1. That proceedings be stayed upon the agreed terms except for the purpose of enforcing those terms.
2. Each party shall have permission to apply to court to enforce those terms without the need to bring a new claim.
3. An order for payment of money out of court, if appropriate, and provision for accrued interest thereon.
4. An order for costs.

Order for costs: For example, this might be for the payment and assessment of costs, or for each party to bear its own costs, or for “no order as to costs”. The costs order must be clear to avoid subsequent disputes between the parties and to ensure that the court is able to seal the order without the need for a hearing simply to clarify the parties’ intentions as to costs.