We have previously reported on the Court of Appeal judgment in Lomax v Lomax [2019] EWCA Civ 1467. In the Lomax decision, the Court held that it had the power to order an early neutral evaluation (ENE) even where one or more parties did not consent to that course. At the time we observed, among other points, (i) that the Lomax judgment had the potential to prompt an increase in use of ENE by parties (either on their own initiative or further to directions from the judge); and (ii) that the decision was of wider significance in the context of the debate as to whether the courts’ encouragement of ADR should extend into compulsion.

Two recent High Court decisions highlight the relevance of these observations. In a (brief) judgment in Telecom Centre (UK) Limited v Thomas Sanderson Limited [2020] EWHC 368 (QB), Master McCloud provided some guidance on how parties and judges could approach the ENE process in light of a lack of such guidance in the Queen’s Bench Guide. In McParland & Partners Ltd and another v Whitehead [2020] EWHC 298 (Ch), Sir Geoffrey Vos queried, in obiter comments, the relevance of the Lomax decision with respect to the power of the Court to require a party to try mediation.

Telecom Centre and the suggested approach to ENE by the Court

In Telecom Centre, Master McCloud in the Queen’s Bench Division raised the option of using ENE – which the parties had also already considered on their own initiative – to assist the parties with settling the case. Commenting on the lack of specific information on the use of ENE in the Queen’s Bench Guide, she used the judgment to share her approach to the process in order to inform other litigants and, potentially, the current author of the Queen’s Bench Guide.

The judgment proceeds to explain the purpose of ENE and provides insight into how ENE procedures could be structured, when the process might be helpful, and how it may assist the parties and the Court. The decision also appends a generic version of the order made in the case by Master McCloud, for guidance on what might be included in an ENE order.

The guidance offered in the judgment with respect to the ENE process might serve as a precedent for other judges who are considering to suggest (or order) that parties engage in ENE. The decision further appears to demonstrate an increasing level of interest in ENE following the Court of Appeal’s endorsement of the process in the Lomax decision. Of course commercial parties will continue to think about whether they prefer ADR processes which are centred on party choice and control, such as mediation, or processes which enlist the assistance of a quasi decision-maker even where the neutral’s evaluation is not binding.

McParland v Whitehead and the application of Lomax to other forms of ADR

The McParland v Whitehead decision concerns the disclosure pilot scheme and is discussed in more detail in our Litigation Notes post here.

From an ADR perspective, it is interesting that the Court records its encouragement to the parties to try mediation. In doing so, the Court notes that it mentioned the Lomax judgment to the parties and commented that Lomax “inevitably raised the question of whether the court might also require parties to engage in mediation despite the decision in Halsey v Milton Keynes General NHS Trust”. The Halsey decision established the position that the courts do not have the power to compel unwilling parties to engage in ADR.

Even though the Court did not have to answer its question because the parties in McParland voluntarily agreed to attempt mediation, it is notable that the issue was raised in the judgment and Sir Geoffrey Vos’ statement might indicate that the Court is open to reviewing the Halsey position in an appropriate case.