Justice Committee

Meeting date: Tuesday, February 6, 2018

Official Report 568KB pdf

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Alternative Dispute Resolution

Item 4 is a round-table evidence session on alternative dispute resolution. The purpose of the session is to explore issues relating to the use and availability of ADR in Scotland and any barriers to its use. I welcome all the witnesses, and I look forward to hearing their evidence.

We will begin with introductions. As we go around the table, I ask that you say who you represent and we can take it from there. I will start. I am the convener of the Justice Committee.

I am one of the clerks to the committee.

I am one of the clerks to the committee.

I am the MSP for Coatbridge and Chryston.

I am the mediation co-ordinator for the Edinburgh sheriff court mediation service.

I am the MSP for Edinburgh Northern and Leith.

I am the chief executive of the Scottish Arbitration Centre.

Madainn mhath. Good morning. I am an MSP for the Highlands and Islands.

I am the chair of Scottish Mediation.

I am the MSP for Orkney. For the purpose of this morning’s discussion, I should declare that my wife is a mediator with Relationships Scotland Orkney.

I am a practising Queen’s counsel and vice-dean of the Faculty of Advocates. The written submissions were prepared by one of our special interest groups in the faculty—Faculty of Advocates arbitration—which has a special interest in arbitration and other forms of dispute resolution. The faculty also has a strong interest in litigation as a method of resolving disputes, but I am here to address the issues on the agenda.

I am the chief executive of the Scottish Legal Aid Board.

I am an MSP for North East Scotland.

I am an MSP for West Scotland.

I am a practising solicitor advocate. I am not here to represent any particular area of ADR; I am happy to address all the issues.

I am the MSP for Angus North and Mearns.

I am Paisley’s MSP.

I am a non-practising advocate and a full-time mediator—[Interruption.]

I am the MSP for Edinburgh Southern. I draw to members’ attention the fact that my wife is a practising solicitor at the firm Pinsent Masons, for which Craig Connal also works.

I am the MSP for Strathkelvin and Bearsden and deputy convener of the committee.

We chose the round-table format because it is a bit more flexible and informal, although the evidence given is still on the record. The format allows witnesses to engage with one another in a free exchange. However, I ask you all still to indicate to me when you want to speak, so that you speak through the chair. Do not worry about the microphones—they come on automatically when you are called to speak.

As always, it was helpful to get written submissions. In fact, we have been inundated with submissions over the past 24 to 48 hours. This morning, we will concentrate on feeling our way through alternative dispute resolution generally. We will maybe follow this session up with another session to take in evidence on particular aspects raised in other submissions.

What are the various advantages and disadvantages of the different types of alternative dispute resolution?

I am happy to deal with the different topics; it might assist if I mention a number of types of ADR, which might prompt some more discussion.

Although I understand that we are here to discuss ADR, I say, without having any axe to grind, that I would be disappointed if we headed down a route similar to the one that has been taken south of the border, where there is a pretty firm drive to keep people out of the courts. In this jurisdiction, at least so far, the courts have been perceived as part of a public service to which everybody should have access in an efficient and cost-effective way. The notion that one should really try to keep everybody out seems—

We will cover that angle as the discussion develops. Thank you for raising it.

I am conscious that a number of people here will speak about particular areas. When I was asked to appear before the committee, the forms of ADR that occurred to me included arbitration, of which Andrew Mackenzie is a great promoter, whereby the parties select a decision maker under a statutory scheme, and mediation, on which a number of witnesses have a particular focus and which is, in effect, a chaired negotiation—that is just my term; it is not an official definition.

10:00  

I will mention other types in passing, because the people here do not deal with them in particular. There is adjudication, which some committee members will be very familiar with. In the construction industry, adjudication was imposed by statute some years ago as a form of dispute resolution outwith the courts. It is meant to be quicker and cheaper than going through the courts or arbitration. Arguably, it is not an alternative in the normal sense, because if someone has a construction contract, they must use adjudication first, although they can challenge the decision later. I mention it only so that the committee is aware of it.

The other form of ADR that occurs to me is expert determination, which is probably also not on the agenda of any of the witnesses today, and which is used in some contractual structures. Expert determination is where the parties agree that if a particular type of issue crops up, they will send it away to an expert, such as a surveyor or other type of expert, whose decision will be final. It is not quite like arbitration, in that it is not treated as a quasi-judicial determination, but it is another mechanism that some people use to reach a decision.

Having given that outline, I am happy to contribute to the discussion later. I ought to stop now and let others speak.

I will pick up on a general issue to do with the term ADR, or alternative dispute resolution, which I think was mentioned in the paper that was submitted on my behalf rather hastily last week.

I think that there is a danger—which we might already have had a hint of—that the different options for the resolution of disputes will be viewed as being in some way in competition with one another. One cause of that view might be the use of the description “alternative dispute resolution”. In many jurisdictions, “ADR” is no longer used to describe what are, as Craig Connal has fairly said, a large number of possibilities for helping people to resolve disputes.

The question about the term is: alternative to what? In earlier days, one was looking at alternatives to court—to litigation. Really, what we are looking at is a range of options by which people who have a dispute that is unresolved and which they have been unable to resolve themselves can be assisted in the early, effective and efficient resolution of the dispute.

I would counsel the committee to move away from using the expressions “ADR” and “alternative dispute resolution”, if it feels able to do so, and to look at a range of dispute resolution options. There are a number of those, which Craig Connal has outlined.

For me, the question to be asked is: what is the appropriate process to offer to those who have unresolved disputes that will help them to resolve their dispute quickly, effectively, constructively and efficiently? A number of questions arise from that, which allow us to look at the different forms of dispute resolution and to work out a hierarchy, if you like.

The reality is that the vast majority of disputes are resolved by the people involved themselves, using what we would call negotiation, whether that is skilled or not. Those that are not resolved in that way are resolved with the assistance of others using negotiation. Only a very small number of disputes require the assistance of a third party. Let me give examples of questions to ask. When is it appropriate to involve a mediator as that third party? When is it appropriate to involve an arbitrator? When is it appropriate to involve the court? In most jurisdictions—and Scotland has historically been slightly out of step here—the court is viewed as a last resort, for all sorts of reasons.

It seems to me that those are the questions and issues that the committee might wrestle with.

The suggestion to think of it as a range of dispute resolution options is helpful. I think that Daniel Johnson has a small question on what John Sturrock has just said.

It is on the back of what John Sturrock and Craig Connal have said. Should we be viewing things such as the small claims court as threads in dispute resolution? That is, should we be looking not just at alternatives to court but at options within the court system and at whether simplified routes through the court system might be—or should be made—available to people? Is that fair?

That is fair, but I might take it back a step and ask: what is the most effective way for people to resolve their small claims? Is it through an adjudicative process, where a third party pronounces the decision, or might there be a number of cases in which the negotiation process would effect a more helpful result for the people involved? There are principles to be applied, and then, as you rightly suggest, we ask: if adjudication by a third party, including a court, is appropriate, what is the most effective and streamlined way of doing that, in the circumstances?

My point was going to be similar to John Sturrock’s. The term “ADR” tends to cover a mixed bag of apples and pears. One thing that might be useful to think about is that, at one end of a spectrum, we have interest-based systems of coming to an agreement, and at the other end of the spectrum, we have rights-based systems. Arbitration is very much at the rights-based end, and mediation is very much at the interest-based end. The spectrum that was described earlier covers a range, into which interests and rights can come. That might be a helpful way of looking at the issue.

As I said, mediation is very much at the interest-based end of the spectrum. What follows from that is that it is voluntary and facilitative. Those are key aspects of mediation. Another useful thing to consider is that mediation not only is an alternative to the courts, tribunals and onwards but has a phenomenal reach. Mediation operates from the playground, through family situations, which do not necessarily come to court, through communities, workplaces, commercial and public services to—in the shadow of the courts—tribunals and onwards.

That reach reflects something slightly different about mediation, which is also reflected in the fact that mediation is about a way of having dialogue. It is important that that underpins the way in which people deal with difference and the disputes that may come from—but do not necessarily come from—difference. Mediation is also about the change in the culture of how we deal with things. I will leave it at that.

It is very wide ranging, and people of all ages, from the very young to the very old, can benefit.

We can see “dispute resolution”, as opposed to “ADR”, as the umbrella term; underneath that umbrella are various methods of resolving disputes, including litigation, arbitration, mediation and other methods that Craig Connal mentioned. All are options for individual clients, and the decision on which is the best method to use to resolve a dispute should be carefully considered with each client, with advice from their legal adviser, if they have one.

When we look at the differences between the methods, we can see that they all have advantages and disadvantages and that not all of them are appropriate for every individual. They should be carefully considered, and the best method, tailored to the individual’s needs, should be selected.

It is unfortunate that litigation is not represented here today. What is on the agenda is ADR and the barriers to using it, and that is obviously significant. However, if we consider “dispute resolution” as the umbrella term, it is important not to exclude litigation. As Craig Connal said, we would not want to ignore it completely, because it is a fundamental and important part of the package of methods that are available to clients.

That is helpful.

I agree with Angela Grahame that it is about the range of options that Craig Connal and John Sturrock described. Therefore, it is about ensuring that the parties understand what the options are. More information about the options is needed for people and small businesses. Practitioners and advisers need to make sure that the parties in a dispute are aware of the options that are open to them, which could include mediation, arbitration or litigation. As Angela Grahame said, there is no right or wrong option—what is right for the parties depends on the case.

There is permeability between the forms of dispute resolution. A dispute need not necessarily go down one route or another. Quite often, as John Sturrock has described, people may start a negotiation in anticipation of court proceedings or to avoid them; court proceedings may result from a negotiation that has not successfully settled the matter but which may have narrowed down for litigation the issues that are in dispute; through litigation, referral may be made to mediation in a variety of circumstances, which may bring an end to the proceedings or further narrow down the issues, resulting in a subsequent settlement or, indeed, a narrower litigation. Very often, it is not one option or the other. People might try a range of ways to resolve disputes, particularly if they are quite tricky.

That opening has given us a good basic understanding.

How often is the client advised of all those options? I am trying to get the scale of how often people use ADR. Is it recommended regularly by the profession?

I am the vice-dean of the Faculty of Advocates. Advocates are generally involved in litigation, although a strong interest group is involved in arbitration and mediation, on which we are training large numbers of advocates so that they can be effective and give detailed advice to clients. However, advocates are involved in many situations because litigation has already started, so the gatekeeper or first point of contact with a client or potential client on a decision about whether to resolve a dispute is the solicitor or solicitor advocate. They may be in a better position to comment on the frequency of advice. The Law Society of Scotland’s code of conduct requires solicitors to give advice about the different methods of dispute resolution that are available to clients. If clients request information, I have no doubt that the solicitor could advise on that.

Thank you. That information is helpful.

We have to be careful about how the different methods relate to one another. In the example of litigation and arbitration, the law says that, if there is an arbitration clause and one party insists on dispute resolution by arbitration, the courts will enforce that—“to arbitration you must go”, as one judge put it. If both parties want a matter resolved by a judge—it may be a technical legal point—they have the option to agree between themselves to go to court.

Mediation is discussed regularly, usually against a background of trying to resolve matters. People sometimes have the impression that the whole function of lawyers is to generate as much litigation as possible to make as much money as possible, but that would be a short-term view, as it could leave clients unhappy at the end. I suspect that many lawyers spend much of their time persuading parties to do other things rather than fight forever in an expensive forum, whether arbitration or litigation, which inevitably leads to whether there is another way to resolve the matter.

As John Sturrock said, the simplest method is to negotiate a solution. If someone can do that, why should they do anything else? However, it may not be possible—personalities may be involved and it is not unusual for people to take positions—in which case one option may be mediation.

The common view is that compulsory mediation is a bit of a contradiction in terms. It is something that people should opt to do because either they or their advisers think that it is the right thing; they should not be forced into it. It is probably fair to say that finding a solution is always discussed and that mediation will come in depending on the other options.

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I will bring in Liam McArthur, who wants to pick up on a small point.

Mr Connal has covered some of what I was going to ask, so I am happy to leave it at that.

That is fine. We will move on to John Sturrock, Andrew Mackenzie and then Heloise Murdoch.

I will respond to Rona Mackay’s question, if I may. In some ways, she has identified the key to all of this, which is that people in Scotland with disputes should be able to make informed choices. I have no doubt that the provision of information is better now than it has ever been, and that many advisers now include in their advice to clients the fact that there are options other than litigation.

However, when matters become disputatious and are not capable of easy negotiation, it is fair to say that the prevailing culture in Scotland is to default to adversarial processes. In such processes, as Robin Burley hinted earlier, people inevitably set out their positions. They are involved in the paradigm of establishing right against wrong and have a win-lose approach. I suggest—and this may be where one becomes a little bit more tendentious—that there are significant societal, economic, business and community benefits for Scotland in moving towards a more consensual culture in which more disputes are dealt with co-operatively and consensually and therefore by negotiation, which may be aided or otherwise.

As a mediator, the phrase that I hear more than any other is, “I wish we’d had this conversation a year ago.” That is often said by experienced people—clients, businesspeople, parties and individuals—who are involved in significant litigation and who discover that, in the course of a day, they can indeed resolve their disputes, but have spent a considerable amount of time and incurred a lot of emotional and other stress and disproportionate cost.

I am considered in what I am about to say, but I am pleased to be able to put it on the record. I know that people will say that it is a special pleading, but I will try to distance myself from that. I am frequently shocked at the disproportionate amount that parties, including many lay people, have incurred in costs in litigation prior to achieving a solution in that litigation that, it seems to them and others on the day, might have been achieved at much less cost and with much less stress and anxiety.

Therefore it seems to me that, in Scotland, there is a possibility of our moving towards a more consensual approach to many disputes—though not, by any means, all of them. If we can invite, inform, encourage and advise people with disputes to use a range of options—including, as Robin Burley has described, interest-based negotiation, by which he means that people are able to work out what they really need and want and find the intersection of that—that would be a good thing. Mediation is never compulsory. Even if people are encouraged or compelled to use it, we can never compel them to agree. In that process, they can still decide not to reach an agreement and use other processes if they wish to do so.

Therefore I say to Rona Mackay that provision of information about the options is very important. However, other stimuli and incentives may be necessary in order to bring Scotland to a place that so many other jurisdictions have reached.

Thank you. That is helpful.

I am aware that a number of members want to come in, but I am going to go to the witnesses first, to hear what they have to say.

I have something to add on the question. John Sturrock is right that there is now more information about mediation and arbitration than there has been. However, I think that there is still more to do on educating the wider public about the options and, indeed, encouraging solicitors to do more to make sure that they are very clear on the options for their clients. As Angela Grahame has said, solicitors have a duty to ensure that they explain the different options. We perhaps need to go back to universities and ensure that, at the time of the law degree, students are being made more aware of the options and there is not just the usual focus on litigation that we tend to find—for example, during the diploma in legal practice course.

A lot of what I was going to say has already been covered, but I want to add to the point about mandatory mediation. When a sheriff makes a referral to the Edinburgh sheriff court mediation service, it is mandatory for the parties to speak to me, as the co-ordinator, and receive information. It is always clear from that point onwards that mediation is one choice among other choices.

I want to add a comment to what John Sturrock said. I find that a lot of the cases that I deal with are more suited to mediation than to litigation. Maybe those who are involved do not have a lot of evidence or there is a lot of emotion, and sometimes people just want an apology. Mediation enables people to meet on an even basis, as it is set up for party litigants. There are some cases in the court where one party is represented and the other is not.

With mediations, about 75 per cent are successful, but it is always stressed right from the beginning that it is a choice. As long as the information is there, people always have the option, even after the mediation, of going back to court. We track cases after they go to mediation and we find that, in about 50 per cent of them, even if the parties do not settle at mediation, they settle later and do not reach a proof or evidentiary hearing.

I have a particular interest in apologies, which you mentioned. Are people aware of the Apologies (Scotland) Act 2016, and has it helped to encourage them to come forward seeking mediation and an apology?

I have not had experience of that so far, but it is something that I will look out for.

There is more work to be done.

We will hear from Robin Burley and Angela Grahame next. I always give the witnesses the first shot. After that, I will bring in Liam Kerr, Ben Macpherson, Mairi Gougeon and Daniel Johnson, and I will then go back to Rona Mackay.

I was going to comment on the compulsion aspect as well. I think you would find that, among the mediation community in Scotland, there is agreement that mediation should not be compulsory. Where we find the word “compulsory” being used in relation to mediation, it is usually about people having information. In the appendix to the submission from Relationships Scotland, there is an article by Stuart Valentine about people getting information before they go on, and quite a lot of jurisdictions require that. It is generally felt that that aspect of compulsion is acceptable, but compulsion to go to mediation is not.

Issues arise about the way in which that simple procedure has been carried out in the courts recently. I do not think that there is yet a good understanding that, when a sheriff asks people to go to mediation, that needs to be about their finding out more about mediation rather than about their case being determined through mediation.

In relation to simple procedure, it might be worth mentioning that, tomorrow evening, Scottish Mediation will hold a seminar that will involve sheriffs and others, including the Scottish Government, looking into and exploring the past year of using simple procedure; the ADR clause in relation to that, which generally means people going to mediation; and how we can improve that process. Any member of the committee who is interested in joining us at that seminar is welcome to come. It will be at 5 o’clock tomorrow.

That is duly noted.

I draw the committee’s attention to a significant event that will take place in Edinburgh in 2020: the International Council for Commercial Arbitration 2020 congress. I understand that the event is the arbitration world’s equivalent of the Olympics. The Scottish Arbitration Centre competed with a number of high-profile venues and secured the bid—there is mention of that in its written submission to the committee.

In the world of arbitration, all eyes will be on Edinburgh, and it is an amazing opportunity for us here—and in Scotland generally—to showcase our talents in arbitration. It is important that we all work together. In April this year, the official handover will take place in Sydney, Australia. The dean of faculty will attend, along with other members of faculty. FoA arbitration—the special interest group on arbitration in faculty—wishes to assist in promoting the event over the next two years, because the profile of arbitration will be raised.

That is helpful to know. However, today we are drilling down into why we should use arbitration and what the advantages are.

A number of the witnesses suggested that compulsory mediation would not be the way to go. Was mandatory conciliation the right way to go in the employment tribunal? It has a high success rate, and there are savings to the parties and the public purse. If it was the right way to go in the employment tribunal, why does it not extend to other forms of litigation?

That is a topic with which the committee should wrestle. I have an open mind about that.

Significant costs are attached to a justice system. When people litigate, they incur and cause others, including taxpayers, to incur the justice system’s costs. If, as the evidence suggests, mediation can help to resolve a large percentage of cases that might otherwise be in the civil justice system, there is at least a discussion to be had about whether people should be encouraged, incentivised or even compelled to try that process in advance of using the justice system, which is their entitlement under article 6 of the European convention on human rights.

You raise a point that is worthy of consideration. I repeat the point that, in encouraging, incentivising or compelling people to try mediation, no one is forcing them to achieve a settlement to reach an agreement, for that could not be done. There are public interest and financial interest reasons for discussing the issue, and the committee should do so. In many jurisdictions, that has been a necessary interim step towards encouraging the greater use of voluntary mediation over the longer term.

Sometimes, there is a process whereby, if the parties have not come to an agreement by the end of the mediation process, the mediator can be asked to give some evaluation of the situation. In a way, that steps outside the interest-based arrangement and moves towards a judgment. As John Sturrock says, those are issues to be explored. However, because in interest-based mediation we are trying to find a resolution in the interest of the parties, it needs to be voluntary. Only after that could one step aside from the mediation and have the mediator take on a slightly different role.

The concept of having an effective court and justice system that is accessible to all is important, and forcing people not to go to that system seems a challenging idea. I agree with the comments about the voluntary nature of mediation.

I am afraid that I have heard anecdotally about quite a few instances in England and Wales in which people have gone to mediation because they were told that they had to. There is a cost involved in mediation—there is a process and the mediator has to be paid. Lawyers are often involved. The parties can go through a process at the end of which they are no further forward. Mediation is also sometimes used as a tactical device to winnow out something from the opposition during the process without any intention of settling. There are arguments about the use of mediation, so there is no simple answer to the question.

10:30  

At an event that I attended, I had occasion to discuss the issue with Lord Tyre from the Court of Session. I asked him directly whether judges should be pushing mediation. He deals with commercial disputes in that court, so he is possibly at one end of the spectrum. His response was no—he regards those in the business community as his customers and he looks to create an effective system that gives decisions in the way that customers want. The commercial court is very good at that. The only thing that he said was that, as soon as he saw in front of him what looked like a corporate dispute that involved two brothers fighting with each other, he immediately said that they might want to think about other methodologies for resolving the dispute, because fighting to the death in the courts might not be the right way forward.

For what it is worth, my view is that it is horses for courses. In some cases, the courts may provide the best solution—for example, if somebody has not done what they should have done and the other party has been deprived of that and has been forced into some form of compromise. However, in other cases, a much more constructive solution can be achieved by negotiation or mediation.

I am not readily persuaded that that answers my question. My point is that, if we accept that a reduced cost to the public purse and to the parties and increased success rates are the endgames, we must conclude that bringing in a mandatory prerequisite for the employment tribunal of some form of conciliation has succeeded. If we started from that point, why would we not at least consider extending the same principle to other forms of litigation?

I do not think that I have all the answers, and I do not pretend to have them. Mediation is less used where it could be most effective, which is in smaller disputes and in disputes that involve individuals, in which their feelings and concerns might be particularly heightened by what has happened. Mediation has tended to focus on being a provision for the commercial world—that is where it started, although it has extended into other areas, as one witness said.

In the majority of employment disputes, which essentially concern an individual’s rights, one might be able to push people into a negotiation, which might be effective. I am afraid that I cannot comment on whether that is a good or a bad thing; I maintain the view that forcing people to go through a compulsory mediation process before they get access to the courts is quite a difficult issue.

The committee is probably aware of the recent litigation over employment tribunal fees that reached the Supreme Court, in which a long judgment was given about the importance of access to justice and how anything that stands in the way of that could be unlawful. That court also made statements about why everybody—not simply A and B who happen to be engaged in a dispute—benefits from the existence of an efficient justice system.

Some nuanced questions are involved. I take the point—from the employment lawyer who is sitting two places to my right—that a system of compulsory reference to the Advisory, Conciliation and Arbitration Service has proved to be successful. I have no doubt that Liam Kerr is right about that.

There are others who are better placed than me to discuss this point but, although Craig Connal referred to mediation having started predominantly in the commercial field in Scotland, and although there is a lot of mediation in that world, there is considerably more mediation in other fields. Mediation started in family cases in Scotland back in 1985—the papers that are before the committee refer to that fact. Others who are here can speak more eloquently about the huge amount of mediation that takes place in the community and neighbourhood spheres and on relationships and employment and so on. The committee should in no sense feel that mediation has been used solely or principally in the commercial field—that is a matter of information.

I will pick up a point that Craig Connal just made, because I think that it goes to the heart of much of the discussion. The proposition is that there is a benefit to wider society in having a justice system and compelling people to use the courts. I understand that proposition in theory, but we need to think about each individual case. Why should each individual litigant be compelled to use a court system for the benefit of wider society if that individual litigant could find an easier, more effective and quicker way of resolving disputes by negotiation? We must be careful about preserving a system for its own sake and recognise the needs of individuals and the value to them of having a more effective system.

A final point for information is that there are a huge number of English cases of high authority discussing all the points that we are discussing—the principle of mediation, access to justice, article 6 of the European convention on human rights, costs, incentives and compulsion—with regard to not just English cases but cases around the world. I know that the committee is exploring matters initially at this point, but I suggest that that might be an area for further exploration.

That is helpful.

Good morning. I am still registered on the roll of Scottish solicitors and, before entering the Scottish Parliament, I practised for a brief time, mostly in commercial contract drafting. A point was raised about solicitors being gatekeepers, but perhaps that is going too far, although they certainly have a significant role in providing guidance. I wonder whether we need to shift the conversation to initial contract drafting and preferred avenues for agreements when relationships break down. For example, I worked on a contract that had a clause that obliged the parties to consider arbitration after a certain period, which gave us leverage to consider involving an expert if the parties did not want to use arbitration—Craig Connell mentioned that situation earlier.

Do we need to think more about the conception of agreements instead of focusing on their end? Do we need to view dispute resolution beyond the main categorisations of mediation and arbitration and think about the role of legal opinion and other creative ways in which solicitors and others in practice can resolve disputes?

I have another question about a matter that we might come on to later. Are there spheres in which we can think more creatively about using alternative dispute resolution in relation to not just commercial contracts but issues around communities, as John Sturrock mentioned? For example, I am looking at how we can assist owners and owner-occupiers of tenement flats to undertake communal work in a tenement property. Is that an area where alternative dispute resolution could play an important role?

There are a lot of different points there, but I think that they are all useful to the discussion.

Absolutely.

Those points are very useful. On the point about focusing on the conception of an agreement, it would be very valuable if a mediation clause went into contracts at an early stage, as it sometimes does. There are examples around the world of mandates or pledges that organisations make to put mediation into their contracts. Scottish Mediation has a plan to introduce a Scottish mediation charter on a voluntary basis for organisations in Scotland, part of which will encourage them to put mediation clauses into their contracts. There could be some exploration of that and how it could be supported by legislation.

There are a lot of other innovative ideas, which are sometimes discovered by organisations that provide mediation for one purpose. Anyone who looks at the “Friends Of The Scotsman” section of The Scotsman will have seen that our director, who is sitting in the public gallery, wrote in that section last week or the week before. He wrote about a community mediation organisation that has started to get involved in owner-occupier problems around agreement to carry out repairs—which is exactly what Ben Macpherson is talking about. Something that started out as a mediation service for neighbour disputes has moved into that area and, in some councils, it has moved into workplace mediation as well.

As mediation moves into an organisation, the organisation starts to find ways in which it can be used. The ingenuity of organisations starts to come into play in using the skill of mediators not necessarily in full mediation but in what I would describe as a mediating way of dealing with difference and issues so that they do not escalate. It is a valuable contribution.

Ben Macpherson makes a good point about contracts. That is, in effect, the agreement that should determine what the dispute resolution mechanism will be. I am afraid that it is not a matter of putting in a mediation clause; it is a matter of making sure that those who are drafting the contract understand what the agreement is about and, therefore, what would best suit the parties—or, indeed, their client—in respect of that agreement. It might be mediation or it might be mediation and arbitration. There could be a tiered clause or the view might be that there should be litigation. I return to the point that it is about our practitioners and contract drafters understanding the differences and being able to advise properly.

We certainly find it more challenging to get to contract-drafting lawyers, who are generally not interested in dispute resolution matters. We find it more difficult to persuade them to think about a particular clause, which might be in a 300-page contract, and to recognise the value of taking time to think about the consequences of what goes into the agreement because, if there is a dispute, what will count is in that clause.

The point is well made. We must do more to get general counsel of companies—in-house lawyers—and private practice contract drafters to think more about what they are putting into contracts.

The committee should be cautious about seeking to limit the choices that are open to clients or potential clients. At the point of either the contract being entered into or a dispute arising when there may not be a contract, it is important for each individual to consider all the available options and to make an informed decision about the best option for them.

The key is education, raising awareness and allowing people to find that information. It is a question of how best to do that. One example that may be of interest relates to personal injury arbitration. Personal injury work is commonly conducted through the courts and litigated. FoA arbitration is promoting and raising awareness of the possibilities of arbitration as a means of resolving personal injury claims. The process has been used effectively in Scotland in the past. Many of the claims that were made by men who were injured during the Piper Alpha disaster, 30 years ago, were resolved through personal injury arbitration, but many lawyers in Scotland, both in the Faculty of Advocates and in the solicitors’ profession, are not aware of that. They are not aware that that method has been used, although Scotland is unique in that regard.

I am trying to think of what would be most helpful to the committee. I am aware that many of us around the table work predominantly at the commercial end of the market, where one hears quite a lot about mediation. However, in Scotland, the reality is that most folk with problems and disputes will never get near a court or a lawyer, not least because they do not have the resources but also because they do not know about the options.

10:45  

There is real potential and a need for awareness raising in the commercial community, which is important for business and the generation of wealth in Scotland. However, we are also talking about family, neighbourhood and community matters—small claims, as we heard earlier—that will require different approaches because they involve different financial, educational and resource needs. The committee would be astute to think about the differences and to differentiate rather than seek one approach that would fit all situations. That goes back to the diversity of it all and how we must focus on the diversity of needs among the people who have disputes.

I want to go back to some of the earlier comments. I am interested in the difference between the consensual and adversarial approaches. When we started our discussion, Mr Connal said that he would not want us to be in a situation similar to that in England and Wales. From what I have gathered—please correct me if I am wrong—you may not want to see a different system operate in Scotland, but there could be ways in which we could utilise ADR methods better. I am interested to hear how it works in England and Wales and to hear your different opinions on that.

I can say something about the English experience—although not in any great detail. Broadly speaking, in England and Wales, parties in civil litigation are in effect told that they must mediate under pain of being penalised in costs if they do not. That is an oversimplified picture but, even when a party considers that they have a cast-iron, open and shut case, they feel obliged to go through a mediation process in order to avoid the ire of the judge later on, who would ask why they have not mediated. John Sturrock would tell you that there is no case that cannot be mediated to a solution. In theory, that is correct.

I endorse the view of horses for courses. Someone mentioned family mediation. Every day of the week, we get court decisions that say that A is right and B is wrong. That is necessary in many cases, because that is what has to be decided. However, in a dispute following family breakdown—I do not pretend to be an expert in that—it is pretty obvious that there is no winner and there ought not to be a loser either, so there is great scope for family mediation to be effective.

I endorse what Andrew Mackenzie said about the difficulty of getting to the contract drafters. I am forever trying to persuade contract drafters to listen to people such as me who have been through the humps and bumps of the consequences of not getting it right, and it is quite difficult. The psychology is quite simple: if you are entering into a contract, the last thing that you want to think about is things going wrong—you are being positive, you are about to do the deal and you shake hands and get the paperwork done and then someone comes along and asks whether you have thought about what you should put in your dispute resolution clause.

There are now some more sophisticated contracts that require tiers. At the first tier, the managing directors of each company should meet to try to find a solution and there are second and third tiers and so on. There are some more elaborate versions out there, but it is a challenging task to persuade people to focus on that early on. Of course, not every dispute arises from the contract, so that approach deals with only one aspect and not all of them.

As John Sturrock said, it comes back to treating mediation as a system that works best if the parties have agreed to be there and want to be there, rather than having mediation thrust upon people when they do not want it. That issue is still out for discussion.

Family law has been mentioned, and there is scope for what you described in that context. We are very conscious that mediation is not appropriate in all family law cases. For example, it would not be appropriate in a case that involved domestic abuse. If we get that out of the way, we know what we are talking about when we are talking about family law.

Mairi Gougeon asked a very legitimate question. Sometimes in Scotland we are a wee bit wary about looking south of the border for help, but there is a lot of information to be obtained by doing so. Since the late 1990s, the English civil justice system has been much more inclined towards finding ways to achieve early dispute resolution. That is incorporated into the rules of court, the way in which judges approach cases and the encouragement and information that clients are given.

With great respect to Craig Connal, I think that the approach to mediation is much more nuanced and sophisticated than he might have characterised it as being. If someone has a completely cast-iron case—very few cases are completely cast iron; if they were, they would not be litigated—they have nothing to fear from the English approach, which is that if a party unreasonably refuses to participate in mediation, having been encouraged by the court to do so, that might have implications for expenses, or costs, as they are called in England. That is a way of trying to adjust the risk balance, if you like, when people might choose not to try something that might be useful for them.

The reality is that in England it is well established that many cases—but by no means all—will go through mediation, and the structure is set up to accommodate that. The information and research over the years show repeatedly that in 85 to 90 per cent of instances that produces a settlement. The parties are out of the court system and everyone is happy.

Of course, every now and again that does not work, and of course that will mean that parties incur some additional cost. However, even then, parties tend to find that the approach has greatly enlarged their knowledge of the case; it often reduces the scope of the issues at discussion. Very often, cases settle a month thereafter, because of that further thought; mediation has helped to focus the issues in the case.

Of course, mediation is not perfect. The benchmark here is the extent to which a new approach might be at least marginally more effective and helpful for clients than the present approach, among a range of options. Some cases, quite understandably and quite rightly, will still go to court. However, the committee needs to be mindful that in Scotland only about 5 per cent of cases in the court system are adjudicated on—decided—by a judge. The statistic raises questions about the use of resources.

The issue is much more nuanced. There is much more to be discussed, and Mairi Gougeon is right to suggest that we look at the experience south of the border.

I have been thinking about things that could be done in Scotland in future. When legislation is being examined up here, consideration can be given to whether mediation is relevant to it. Two areas in which I think that mediation has been successful, in terms of its take-up and use, are the Scottish Legal Complaints Commission and young people’s special education needs. The legislation in both contexts contains sections on mediation.

Providing for mediation in legislation can be a constructive way for the Parliament to add to what is there and maybe to take away some of the obstacles that get in the way of mediation, given that in many cases the obstacle is that the opportunity for mediation is simply not well known. Legislative provision helps to raise mediation’s profile and make it available.

I have a couple of points to make, one of which is about the commercial side of things. When witnesses were speaking, it occurred to me that, although when a contract is drafted the psychology is that its failure is not envisaged, nevertheless a company’s insurers must have an interest in ensuring that the contract is written in a way that minimises the potential risk to the company. Is there a way of exploring the issue by appealing to the interests of insurers?

The convener quite rightly cautioned against taking too broad brush an approach in the context of family cases, given that issues to do with domestic abuse clearly need to be handled with great sensitivity. It is invariably suggested that the only winners in relationship breakdown and divorce are the lawyers, but I imagine that many will make strenuous efforts to dissuade their clients from going down a route that will simply bog them down in more emotional and financial difficulties. Nevertheless, a firmer requirement for mediation would at least strengthen the hand of solicitors that clients need to consider it more seriously than they often do because they are so fixated on getting back at the other partner. I recognise the nuances, but could we find a way to reinforce that?

Before I bring in Andrew Mackenzie, George Adam has a point to raise.

I look at the matter from a practical point of view—Craig Connal has mentioned that. In my constituency, 1,300 fans backed the community purchase of the local football team, St Mirren FC, and put money into a pot to work with A N Other. The lawyers kept asking us how we would deal with things if they went wrong. They asked whether we had considered a dispute resolution process, but we were of a mind to move things forward and get the deal done because everything was rosy. The paper from the Scottish Parliament information centre refers to the view that solicitors act as the gatekeepers; in my experience, sometimes solicitors have given advice in cases but people are at a stage where they need to make progress. In this case, I have taken on the 10-year programme and I will have to manage it.

John Sturrock spoke about normal day-to-day constituency matters when people get involved in mediation. A lot of constituents and members of the public see mediation as a block to getting resolution. They do not get the benefit of it. They feel that they have to go through it before they can get a resolution of the issue. That is connected to the idea of buying into the whole idea of mediation.

Family mediation is a success story in Scotland, and family cases have moved towards it. Bodies such as Relationships Scotland are involved in that work and family law practitioners are aware of the mediation options, which are always at the forefront of their minds.

However, mediation is not always the right way to go. Some family practitioners will tell you that arbitration, for example, may be right for a client, and the submission from FLAGS—the family law arbitration group Scotland—to the committee talked about family law arbitration. Litigation may also have to be considered. The general point is that each case is different. For a family in which there is no way that the two people involved will even be in the same room, it will be difficult to mediate. They might not want to go to court, because they do not want their private business discussed in public. Arbitration may be an alternative that allows a decision to take place when the two people cannot come to a mediated decision.

It is all about making sure that people have options, rather than requiring people always to go down a particular route.

Andrew Mackenzie is absolutely right. I declare an interest, in that I have connections with Relationships Scotland and I know about the work that it does and how it has expanded. Is the way in which referrals are made to mediation still patchy in some circumstances? Are some sheriffs more predisposed to it? May sheriffs even lay an expectation of what they expect to be achieved by that route?

I go back to the comment about mediation being a barrier to clients getting a resolution to a case. In my experience in the simple procedure court, quite a few party litigants have unrealistic ideas of how the court system is structured and what it can do for them. A lot of clients do not realise how difficult it will be to get their decree or the amount of evidence that is required. I suppose that that takes us back to the issue of information and advice, and we have an advice system that we refer people to. People need to be aware of the reality not just of mediation but of litigation.

11:00  

On the comment about the patchiness of referrals, the sheriffs in Edinburgh tend to be pro-mediation. Judicial encouragement can be very important in encouraging people to get mediation, as long as it is not been seen as being mandatory.

You have a dedicated mediation unit in Edinburgh, which is not the case throughout Scotland.

No, although there is also one in Glasgow. However, different courts seem to be taking very different approaches to the simple procedure rules that were brought in.

I will pick up on Liam McArthur’s question. It is important to recognise that, even in family cases, the majority are not litigated. Most family cases are resolved by way of negotiation and settlement, and only a minority end up in the courts in any form, with a minority of those possibly ending up being mediated.

The court has long had the power to refer parties to mediation in family cases, so it has gained a bit of a foothold in family work. Referrals are probably patchy, with enthusiasts for mediation in some local bars and among sheriffs. Many years ago, when we started funding mediation through legal aid, we monitored its take-up. There were definite hotspots, and we could identify individual practitioners who had made it a priority and individual sheriffs who emphasised its benefits in their local courts, which encouraged more take-up locally.

On the question of making people aware of mediation as an option rather than simply ploughing on to litigation, I suppose that we perform a gatekeeper role when we consider legal aid applications for litigation, which are another subset of the picture. Before we grant legal aid to litigate family matters, we ask the parties what efforts they have made to negotiate in order to try to find a settlement and whether they have considered mediation. However, we must be mindful of the appropriate balance and not stand in people’s way of appropriately litigating where that is the right thing for them to do. Although, we are mindful that we avoid becoming a barrier ourselves, we put it to the parties that they should consider whether mediation is an option for them.

For some, mediation is undoubtedly an option, but others do not see it as being for them. Part of the experience of mediation is that it is hard work for the parties. They may get more out of it—they may get back what they put in in terms of a more lasting relationship or a resolution that works for each party. There is no win or lose, because mediation tries to find a mutual solution, but the parties have to give of themselves to the process in a way that many people feel that they do not have to with litigation, where their solicitors might be seen to be doing battle for them. Particularly when emotional issues are involved, mediation is quite difficult for the parties and some may be reluctant to do it.

Rona Mackay will raise a stand-alone issue that we have not covered but want to hear evidence about.

My question about funding has two strands. The first is about the funding framework. How are arbitration and mediation funded? We have heard that they can save the public purse money and reduce legal aid costs, but how does the framework work? Secondly, does it cost the client less to go to arbitration or mediation than it costs to litigate?

I will focus on the issues relating to the simple procedure. We have heard from Heloise Murdoch about what is happening in the Edinburgh sheriff court. Funding is provided only for the co-ordination of the service. The mediators who work there do so on a pro bono basis.

In the west, the University of Strathclyde provides a service in seven sheriff courts through its mediation clinic. It has carried out between 70 and 80 mediations throughout the period of simple procedure. All that work has been done on a pro bono basis; the co-ordination is subsidised through the university.

Elsewhere in Scotland, as far as I am aware, there is no mediation service other than to refer people to Scottish Mediation’s helpline, which refers them to mediators who make a charge. It is not a high charge, but the problem is that in some courts people are asked to pay for mediation while in other courts they get the mediation free, and different arrangements for the co-ordination of mediation operate across Scotland.

Over the past year, there has been quite a mixed bag in relation to funding. I hope that tomorrow’s seminar, which will bring together, under the auspices of Scottish Mediation, people who are interested in this area, will address some of those issues.

So there is an issue about access to justice.

There is legal aid funding for litigation and mediation but, as I understand it, the current position is that there is no funding from the Scottish Legal Aid Board for arbitration, which limits parties’ choice. In domestic abuse situations, where there has been control or physical abuse or such like, parties need a decision to be imposed on them; they cannot reach a resolution themselves. That does not happen in mediation, but it could happen in arbitration. A significant number of people working in the field are interested in family law arbitration and have educated themselves in working towards that. However, there is no doubt that a lack of legal aid funding for arbitration limits parties’ choice and means that they are pushed towards litigation if they cannot resolve their dispute through mediation.

We have long funded mediation, effectively as an outlay on a solicitor’s account either prior to litigation under advice and assistance or as part of a grant of civil legal aid. We started doing that in 1995-96, at which point there was a great hope that making funding available through legal aid would unlock mediation because a lack of funding had been holding it back, but I do not think that that was the case.

We have been funding mediation now for more than 20 years and the take-up has not been enormous. As I explained earlier, it has been geographically differentiated depending on local cultures or behaviours by sheriffs or solicitors. I do not think that making funding available was the thing that was going to allow it to flourish, because there are other structural or cultural barriers to moving in that direction.

Are people aware that that funding is available? Is lack of awareness part of the problem?

It is one of the tools available to solicitors in advising their clients and enabling them to make informed choices. It goes back to what advice people are provided with, what options they are presented with and what preference is expressed by their adviser. Lack of awareness of the option and understanding of what it might involve might hold things back as much as, if not more than, the availability or otherwise of funding.

We are meeting the Faculty of Advocates on Friday to discuss arbitration generally; we have previously met Andrew Mackenzie and his colleagues. I do not think that we have ever had a case presented to us for how arbitration could fit into the legal aid system. Mediation sometimes exists alongside litigation proceedings, which are what legal aid is available for, whereas arbitration really is an alternative to litigation. It sits distinct from litigation, so its ability to be integrated into the legal aid system, particularly as it is directed towards litigation, is a bit more of a challenge.

We will discuss that on Friday, when I will be interested to explore just what the funding mechanism could or should be that would enable arbitration to happen, and what rules would have to be placed around that. We have detailed rules around access to legal aid funding for litigation and, in a similar way, we would have to consider what the position would be for arbitration.

The research that SLAB published in 2014—I believe that it was based on research experience from 2012—has been alluded to already. First and foremost, I wonder whether there is a catch-22 situation, because one of the findings of the research was that there was

“a lack of publicity about ... ADR as an option”.

Is there a role for SLAB to promote it?

Secondly, given that the landscape has changed slightly with apologies now being another option, is there any plan to review your role or to do further research?

We have been involved in general discussions about ADR over many years, although they have often focused on mediation. Our experience has been that something is holding ADR back. The research that we published and other research that we have contributed to, such as the Scottish Civil Justice Council’s access to justice committee’s work on ADR, suggest a long list of potential barriers, many of which are cultural or based on knowledge or understanding.

There are opportunities to use online sources of information where different options can be presented alongside one another and, if people use those as they initially try to work out how to resolve a dispute, there is no influence placed on their viewpoint by an adviser who might encourage them to go in a particular direction. The mygov.scot website, which is a growing and useful resource in terms of information on dispute resolution and many everyday matters, presents information about advice services, legal aid, alternatives to court and court alongside one another. It also has links to many mediation and other ADR organisations.

The information is out there but, as John Sturrock referred to it, there is a culture in which the default mode for many people is to go to see a solicitor. By the time they do that, they probably already have an approach in their mind and it is difficult to move them from that if they have a particular focus on wanting to litigate the matter or to be proven right. That approach is not the most amenable to mediation, so it is important to get information to people early when they are considering their options and before they are part-way down a track from which it is hard to retreat.

I am very conscious of the clock, as we have about five minutes left.

In response to Rona Mackay’s question, there is evidence available from other jurisdictions about the savings that might accrue from, for example, the use of mediation. If the committee would like to have access to that, I will provide some information.

That would be helpful.

Certainly, the evidence from England is that very substantial savings are being made through, for example, the use of mediation. It would be useful to think about whether a comparative study could be carried out, but it is also important to look at it not just from the point of view of finance, as there is a danger that we look at it as a way to save public money. That is an appropriate factor or criterion, but there are other issues that I have mentioned, such as stress, anxiety, time, relationships, contracts and so on, for which the use of ADR would have benefits and disadvantages, and all are worthy of consideration.

In my submission, I suggested as one of my recommendations that Audit Scotland might be invited to carry out a review of the civil justice system from a value-for-money point of view. It would be interesting to develop that.

Robin Burley talked about mediation and the provision of pro bono services. That has been great and people have sacrificed a huge amount of time over many years. However, if mediation and mediators are to be perceived as a valuable part of the dispute resolution framework, there comes a point at which some value must be placed on the provision of those services and an appropriate level of remuneration must be made available, not least if we want people to develop those skills and their careers in that way.

11:15  

I will finish these remarks by picking up on what Colin Lancaster said, and what I said earlier. However much we discuss the matter, we are back again to consideration of the structural, societal and cultural ways in which we deal with problems in Scotland. There is often perceived to be a culture of win-lose adversarialism and polarisation in this very building, and that sends signals.

We are, of course, in some ways biologically and psychologically geared up for the fight-or-flight mechanism to prevail, particularly when we are under pressure. It is a matter of working with those ideas and the idea of what it might be like to have a society in which we can understand how people act and react under pressure—particularly when things become very emotional—and how, nevertheless, we can help people to work more effectively.

That was really the context of the Apologies (Scotland) Act 2016. It was an attempt to put a different approach into the culture of problem solving, because apology is a well-recognised way of achieving that. This session has opened up all sorts of possibilities and interesting questions for inquiry.

For reasons of time I will ask two very direct and targeted questions. John Sturrock talked—quite rightly, in my view—about the nuances, and access to justice has come up. Is there a danger that we talk about access to justice when what we really mean is access to the courts? I am not sure that the two concepts are synonymous and I think that they are often wrongly conflated. I would be grateful for your thoughts on that.

I will put my second question to Robin Burley, although I appreciate that others may want to respond. Mr Burley talked about how these approaches are not well known. Given that they are cheaper than the courts and solicitors and that, from the evidence we have seen, the success rates appear to be high, it seems odd that people are not availing themselves of these approaches and do not know about them. A cynic might suggest that members of the legal profession would be reluctant to recommend them, given that they would effectively be talking themselves out of money. Would the cynic be right?

As if, Mr Kerr!

Liam Kerr has raised a very important point, if I may say so. The issue about justice and what we mean by that is one that would take up the whole hour and a quarter and more. He may be right that access to justice is perceived rather more narrowly than it could be. However, I would like to reframe the question and suggest that what we are really considering is availability of early, effective, efficient and useful processes to help people to resolve their problems—disputes, differences or whatever they may be. Justice is a much wider concept or understanding than merely a reference to rights as defined in the law. That itself is a contentious issue and needs to be discussed further.

I do not think that the cynic is right. We need two things—leadership and education. On leadership, it would be great if people within the Scottish Parliament availed themselves of the opportunity to learn about mediation and took courses in it. It would help to show that there are other ways of handling difference and dispute.

On education, when I leave here I am going to the University of Strathclyde to do some tutoring in mediation as part of the university’s diploma course for lawyers. Edinburgh has a diploma course that includes a mediation module, as well. If there were modules in mediation in all the law schools in Scotland, we would see a change coming in. Education is key to making that change, but it is a generational thing. We need leadership now to make the change.

Mr Kerr’s point about access to justice is right. We should look at all the different options, and mediation clearly falls within that. On the point about costs, if we want to see more mediation and arbitration and—particularly at that lower level—to keep that work out of the courts, we have to have a way of making it cost effective.

We have talked a bit about legal aid—the committee will not be surprised that I do not agree with SLAB on arbitration—but I think that we need to be a bit more radical and look at things such as online dispute resolution and telephone mediation. There have been successful schemes elsewhere. Thinking about rural areas in particular, where people might have to travel hundreds of miles to their nearest court, we need to think seriously about how we ensure that people can get access to dispute resolution, whether that is through the court, mediation or arbitration, and that we have proper ways in which people can do that, possibly even from their own home if it is by telephone or on a computer.

We need to be much more radical about ensuring that people have access to different dispute resolution methods and how that actually happens. Do we start to integrate it into the wider court and justice system? Does it become an option in a sort of triage approach, in which people get a choice as they come towards the court door about the different options open to them and the different costs involved? Telephone mediation will obviously be cheaper than having somebody in court for a number of days. We need to be quite radical about what options there are, such as those that are being tested elsewhere in the world, and we need to think about the possibilities for using technology to ensure that people have real access to justice in Scotland.

With that, I am afraid that the clock has beaten us. I thank all the witnesses for what has been an excellent session. ADR—or RDR, if we want to refer to it as that—has not been given the prominence that it could have been given, and today has helped to resolve that to an extent. It has also raised lots of issues and the panel will be pleased to hear that we will look at those during our work programme to decide whether we want to move forward and do more. In the meantime, thank you all very much for attending. I suspend the meeting for a change of witnesses.

11:21 Meeting suspended.  

11:28 On resuming—