It’s good to talk – so is ADR now mandatory?

It’s good to talk – so is ADR now mandatory? 17 Sep

The evolution of the Courts’ power to mandate alternative dispute resolution (“ADR”) in English civil litigation reflects a growing recognition of ADR’s role in achieving the overriding objective: to deal with cases justly and at proportionate cost.

Three cases mark the major touchpoints in this journey: Halsey v Milton Keynes NHS Trust [2004] EWCA Civ 576, Churchill v Merthyr Tydfil County Borough Council [2023] EWCA Civ 1416, and DKH Retail Ltd v City Football Group Ltd [2024] EWHC 3231 (Ch).

While Halsey set a restrictive tone by rejecting compulsory ADR, the recent decisions in both Churchill and DKH Retail reflect a significant evolution in the Courts' approach to ADR, particularly court-ordered mediation. Where Churchill established the legal foundation for compelling ADR, DKH Retail illustrated its practical and procedural implementation within modern case management.

Halsey v Milton Keynes NHS Trust [2004]: a traditional view

In Halsey, the Court of Appeal held that Courts could not compel parties to engage in mediation. Dyson LJ stated that to do so would amount to an unacceptable infringement on the right of access to the Court under Article 6 of the European Convention on Human Rights (ECHR). While the Court accepted that parties should be encouraged to use ADR, it emphasised a core principle that parties should engage in ADR only voluntarily. Whilst a refusal to mediate could give rise to adverse costs awards, such did not entitle a Court to coerce an unwilling party to engage in ADR against its wishes.

The decision created something of a barrier, limiting Courts' case management powers in situations where ADR might be desirable but where one or more parties were unwilling to participate.

That status quo remained, untouched, for almost twenty years until the decision in Churchill v Merthyr Tydfil [2023] – which amounted to something of a doctrinal shift in the Court’s approach to ADR.

In Churchill, the claimant brought a nuisance claim against the local authority for Japanese knotweed encroaching onto his land. The Council argued that the claim should be stayed because Churchill had not first used its internal complaints procedure. The Court of Appeal, therefore, addressed a long-standing question: can a Court lawfully compel parties to engage in ADR, even when one party objects?

The District Judge, following Halsey, had felt constrained in refusing to compel the claimant into any form of ADR.

The Court of Appeal, however, took the opportunity to re-evaluate Halsey. It held that (i) the relevant comments in Halsey regarding Article 6 and the impermissibility of compulsory ADR were obiter dicta, and so were not binding, (ii) the Courts can lawfully stay proceedings or order parties to engage in ADR, including mediation, provided such a direction does not deny access to justice, the claimant's right to a fair trial is preserved and the measure is proportional, and (iii) there is no inherent incompatibility between mandatory ADR and Article 6, so long as access to a judicial determination remains ultimately available.

In Churchill the Court refused the request for a stay (on practical and timing grounds), but the significance of the decision lies in the principle it established: ADR can be made compulsory – even in the face of a party’s objections.

Importantly, the decision saw the Court adopt an evaluative approach to the exercise of its discretion. The Court recognised that it must assess factors such as the nature of the dispute, the parties’ behaviour, the type of ADR proposed, and proportionality on a case-by-case basis – before determining whether it is appropriate (or not) to order ADR.

Post-Churchill CPR Amendments (October 2024)

Following Churchill, the Civil Procedure Rules were updated to reflect this new direction of travel. As of October 2024, CPR Part 1 and Part 3 were amended to clarify the Courts' powers to encourage, facilitate, or order ADR, including in the absence of a party’s consent.

Notably CPR 1.1 (the overriding objective) now explicitly includes dealing with cases in ways that encourage and facilitate the use of ADR and CPR 3.1(2)(m) confirms that Courts can order the parties to participate in ADR.

DKH Retail Ltd v City Football Group Ltd [2024]: ADR in Action

In DKH Retail, the High Court dealt with a dispute over intellectual property and branding—specifically, whether the words “Super” and “Dry” used on Manchester City’s kit constituted trademark infringement of the “Superdry” mark owned by DKH Retail, or were merely a reference to the “Asahi Super Dry” beer sponsor.

At a pre-trial review, the claimant sought court-ordered mediation. It cited Churchill and the recent amendments to the CPR, which (as set out above) explicitly empowered the Courts to encourage or order ADR under the overriding objective and CPR r.3.1. The defendant objected, citing entrenched positions, the levels of costs already incurred in preparing the case for trial and the low likelihood of resolution.

However, Mr Justice Miles, relying on both Churchill and the newly amended CPR, concluded that (i) the dispute remained suitable for mediation, even at a late stage (ii) the parties’ entrenched views made the case ripe for focused ADR, which could bring clarity or settlement, and (iii) the fact that trial preparation was ongoing was not a barrier to ordering ADR.

Accordingly, the Court ordered a “short and focused” mediation over the Christmas period.

The merit of the Court’s intervention was (helpfully!) evidenced by what followed - the case settled before trial, confirming that mediation can successfully resolve even seemingly intractable disputes.

Conclusion

The legal trajectory from Halsey to Churchill to DKH Retail demonstrates a clear transformation in the English Courts’ relationship with ADR.

Where once (Halsey) the emphasis lay on voluntariness and rights-based limitations Churchill served as something of a doctrinal turning point in the Courts’ approach to ADR - overturning the restrictive interpretation of whether to order parties to engage in ADR which had been present within the earlier case law.

DKH Retail demonstrates how the Courts are actively applying that authority, even late in litigation, prioritising judicial discretion, proportionality, and access to justice in a practical sense.

The two decisions have reinforced that ADR is no longer merely optional, but places ADR at the core of civil procedure under contemporary case management.

September 2025

Simon Thomas is a Partner at Edesia Law