PGF II SA v OMFS Co and Compulsory Mediation

Abstract

In PGF II SA v OMFS Co the English Court of Appeal returned to the issues addressed in Halsey v Milton Keynes General NHS Trust and made a distinct change to the guidelines developed therein by Dyson L.J. on the circumstances whereby a party’s refusal to mediate may be subsequently penalised in costs. The headline decision was that, as a general rule, a party’s failure to even respond to an invitation to mediate was itself unreasonable, irrespective of whether there was a good reason for refusing to mediate. Within that decision, however, are judicial statements that have led many to ask whether mediation in England & Wales is compulsory in all but name. In particular, Briggs L.J.’s statement that the courts will expect parties to "engage" with ADR points towards such a conclusion. This article examines the judgments of both the Court of Appeal and of Mr Recorder Furst QC in the Technology and Construction Court (TCC) in PGF and assesses whether, post- PGF, mediation is compulsory.

Keywords: ADR, mediation, costs