An amendment to the High Court Rules (Rule 41A) which came into effect from 9 March 2020 has made it mandatory for parties to consider mediation at the outset of any contemplated litigation.
There are a number of judgments where the courts have censured the parties’ and their representatives’ failure to consider alternative dispute resolution mechanisms such as mediation to resolve their issues. This is because litigation is, at the best of times, a time-consuming and costly exercise, often leaving parties feeling like they have lost, no matter the outcome.
‘Marriage is, typically, born out of such love and solemnised with such hope that its termination by divorce cannot but be tragic. But the death of this marriage, or at least the manner in which the last rites have been pronounced over it, represents a tragedy of an especially painful sort.’
This is the opening paragraph of the judgement in MB v NB (2010), a divorce matter where the judge thought the parties might have benefited from a mediation.
The court in the MB v NB case limited the fees which the attorneys could charge because ‘the failure of the attorneys to send this matter to mediation at an early stage should be visited by the court’s displeasure’.
Mediation is the facilitated negotiation of a dispute conducted by an impartial mediator with the objective of settlement.
The new Rule 41A requires that every new action or application must be accompanied by a notice, which must be delivered by a plaintiff or applicant with the summons or notice of motion and by a defendant or respondent with a plea or answering affidavit, indicating whether the party agrees to or opposes referral of the dispute to mediation. These notices must state the reasons for each party’s belief that the dispute is or is not capable of being mediated. This notice is delivered on a without prejudice basis and therefore does not form part of the record of the trial or hearing.
There is also provision in the rule for the judge or the case management judge, acting in terms of Rule 37A, to direct the parties to consider that the matter be referred to mediation, and also for the parties, at any stage before judgment is granted, to refer the matter to mediation, provided that where proceedings have commenced, the leave of the court is obtained.
There is no sanction for non-compliance provided for in the rule. It is not inconceivable that a court considering a matter in which the parties have not complied with this rule, may exercise its inherent powers to rule that the matter should be postponed until the parties have considered whether or not mediation would, in fact, be appropriate.
Where a dispute is referred to mediation, the parties must deliver a joint signed minute recording their election and enter into an agreement to mediate. The time limits prescribed by the rules of court are suspended for the duration of the mediation proceedings, but if a party feels that the suspension is being abused, they may apply to court for upliftment of the suspension. In matters where there are multiple parties, those who agree to mediation may proceed despite any other party’s refusal to mediate. Similarly, in matters with multiple issues parties may agree that some issues be referred to mediation and the remaining issues in dispute proceed to litigation.
In a matter where there is a single party on each side, the fact that one of the parties is not agreeable to mediation will seemingly mean that no mediation can take place.
Subject to the usual disclosure requirements, all communications and disclosures, whether oral or written, made at mediation proceedings, are confidential and inadmissible in evidence. A joint minute is filed, at the conclusion of the mediation, indicating whether full, partial or no settlement was reached and the issues upon which agreement was reached which do not require hearing by the court.
The practical implications, challenges and success of the rule are yet to be seen. However, every practitioner should seriously consider how best to advise their clients in light of this amendment, bearing in mind some final remarks of the court in MB v NB:
‘Mediation can produce remarkable results in the most unpropitious of circumstances, especially when conducted by one of the several hundred people in this country who have been trained in the process. The success of the process lies in its very nature. Unlike settlement negotiations between legal advisers, in themselves frequently fruitful, the process is conducted by an independent expert who can, under conditions of the strictest confidentiality, isolate underlying interests, use the information to identify common ground and, by drawing on his or her own legal and other knowledge, sensitively encourage an evaluation of the prospects of success in the litigation and an appreciation of the costs and practical consequences of continued litigation, particularly if the case is a loser.’