Recent Success of Court-Ordered Mediation in England and Wales and Abroad: The Way Forward?
Following the case of Churchill v. Merthyr Tydfil CBC [2023] EWCA Civ 1416 and the subsequent amendment to the Civil Procedure Rules (CPR) in England and Wales, there has been a change in attitude towards mediation in the courts. In the Churchill case, the court held that proceedings could be paused (or ‘stayed’ or ‘sisted’) and parties could be ordered to engage in alternative dispute resolution in order to encourage settlement. Such an order could only be made, it was decided, as long as the claimant's right to a fair trial would not be impaired and where it would be proportionate to achieving the legitimate aim of settling the dispute fairly, quickly and at reasonable cost.
Since Churchill, courts have started to embrace the option of mediation as a way to encourage parties to resolve their disputes. Last month, the decision in the case of DKH Retail Ltd & Ors v City Football Group Ltd [2024] EWHC 3231 (Ch) re-affirmed the ability of mediation to resolve even complex commercial disputes. Furthermore, this progressive approach has not only been adopted in England and Wales, but also further afield. The French case involving NGOs ClientEarth, Surfrider Foundation Europe and Zero Waste which brought an action against Danone S.A. has also recently shown the potential success of court-ordered mediation.
Court-ordered Mediation in England and Wales
In DKH Retail Ltd, the High Court of England and Wales granted an order for mediation, despite the defendant’s objections that it was too late in the day for mediation and that both parties were seeking for the matter to be determined judicially. The claimants in this case, owners of the Superdry clothing brand, argued that the City Football Group, owners of several football clubs including Manchester City, had infringed on its trademark. The alleged infringement came from the branding on the players’ kit, which contained the words “Super” and “Dry” as it promoted the football club’s sponsor, Asahi Super Dry 0.0% lager.
Despite the defendant's objections, the judge decided to make an order for the parties to mediate. He noted that “bringing the parties together through mediation can overcome an entrenched reluctance of parties to negotiate, even where sincere.” He reasoned that the parties may benefit from mediation as they had become entrenched in their positions. He also reasoned that mediation offered a range of options for the parties that were not otherwise available through the court.
In a postscript to the judgement, which is available here, it was noted that the parties had managed to settle their dispute. This case is an example of how both parties can benefit from the flexible and creative approaches mediation can bring to achieving settlement and how can help to facilitate a settlement which may have been otherwise unattainable.
Court-ordered Mediation in France
Another notable recent case occurred in France, where the environmental groups ClientEarth, Surfrider Foundation Europe, and Zero Waste France brought an action against Danone S.A. The environmental groups accused Danone of failing to meet its sustainability commitments, particularly related to plastic waste reduction. Instead of proceeding directly to trial, the French court ordered the parties to engage in mediation.
Initially, Danone resisted the mediation order, arguing that the matter was a legal one, rooted in the specifics of corporate governance and international trade regulations. However, the court’s insistence on mediation opened the door for both sides to come together in a structured and collaborative environment. Through the mediation process, the parties were able to discuss not only the immediate concerns about plastic waste but also broader environmental and corporate responsibility, which led to a constructive dialogue.
The mediation ultimately resulted in an agreement where Danone committed to more rigorous environmental actions, including clearer goals for reducing plastic packaging and increasing recycling rates. The settlement was hailed as a significant step forward for both corporate accountability and environmental advocacy.
Conclusion: A Tool for Global Resolution
The successful outcomes of DKH Retail Ltd v City Football Group as well as the Danone mediation case highlight the increasing global use of court-ordered mediation as an effective dispute resolution tool. From complex commercial disputes to pressing environmental challenges, mediation can offer a platform for parties to explore solutions collaboratively rather than through the rigid processes of litigation.
These cases demonstrate that mediation, even when compulsory, can lead to positive resolutions. By encouraging cooperation and negotiation, even in contentious disputes, mediation can foster a shift away from adversarial litigious settings toward more mutually beneficial outcomes. As Mr Justice Miles stated in his decision in DKH Retail Ltd v City Football Group, “mediation is capable of cracking even the hardest nuts”. It can only be hoped that this attitude towards ADR continues to develop and that the courts encourage parties to consider ADR, even where there is initially a strong resistance to this.
Rachael Cartwright is a trainee solicitor at Morton Fraser MacRoberts and co-chair of Young Mediators