HL Deb 21 February 1994 vol 552 cc419-22

2.50 p.m.

Baroness David asked Her Majesty's Government:

Whether in the course of their current programme of reducing costs, delay and complexity in civil litigation, the Lord Chancellor's Department have obtained information about the types and number of civil cases which could be referred to mediation, if sufficient facilities existed

The Lord Chancellor (Lord Mackay of Clashfern)

My Lords, it is clear that alternative dispute resolution practitioners claim benefits for mediation across the whole spectrum of civil cases. However, despite a substantial body of published research, there is as yet very little empirical evidence to support these claims.

Baroness David

My Lords, I thank the noble and learned Lord for his not very satisfactory Answer. Does he still stand by his statement of October last year to the Chartered Institute of Arbitrators in Glasgow that he is very much in favour of alternatives to court procedures for those whose disputes can be resolved effectively without recourse to litigation? Is he aware that many commercial cases— sometimes involving millions of pounds— have been resolved through mediation, often in only one or two days, by organisations such as the Centre for Dispute Resolution? Is he also aware that mediation took place in one day of a £ 27 million case which was set for a 12-week hearing? That was announced in the Financial Times in January this year.

The Lord Chancellor

My Lords, I try, so far as possible, to ensure consistency in the various statements I make, and I stand by what I said in Glasgow. The difficulty is to identify in advance those cases in which alternative methods may be of particular use. The case to which the noble Baroness referred proves ex post facto, as it were, once the agreement had been reached, that it was a good idea to look at that way of resolving it. It appears as though it may not have been the most difficult case to resolve as it was resolved so quickly.

Lord Hailsham of Saint Marylebone

My Lords, I do not know whether my noble and learned friend has available to him the figures for the proportion of cases which start by writ or county court summons and which ultimately end in judgment after a contested trial? If he has, can he give them? I believe that they will dispel the canard, absurdly held by many people, that lawyers make their business in fighting cases rather than by disposing of them by other means.

The Lord Chancellor

My Lords, there are a number of different figures in that area. I know that an extremely small proportion of cases ultimately go to trial compared with the number which are initialed. That is one of the difficulties of a requirement to submit to alternative dispute resolution. All that one may be doing is adding a fifth wheel to the coach requiring people to go through a system which in any event will be unnecessary because they have managed to solve their problem without a trial. However, if it is decided to do that earlier rather than later, it would help to avoid strains on the system which presently exist through unresolved cases continuing, and sometimes for too long.

Lord Cocks of Hartcliffe

My Lords, in the course of inquiries, will the noble and learned Lord the Lord Chancellor tell us whether he is receiving the enthusiastic co-operation of the Law Society?

The Lord Chancellor

My Lords, I believe that it would be fair to say that legal practitioners generally are pretty enthusiastic for methods of dispute resolution in which they can help and participate. There is a difficulty sometimes in that when alternative methods have been developed, they become very like that to which they are an alternative. Indeed, at the conference to which the noble Baroness, Lady David, has referred, one of the complaints made was that arbitration was becoming increasingly like court proceedings. Some identified the reason for that as the participation of lawyers in arbitration proceedings. I did not have to take a position on the identification of the cause.

Lord Irvine of Lairg

My Lords, since the Legal Aid Board has adopted the position that legal aid cannot he made available for mediation, is the noble and learned Lord of the view that it is desirable that a legal aid certificate should be capable of covering processes which can lead more economically to the resolution of disputes out of court? If the sense of the noble and learned Lord's previous answers is that he is not convinced about the effectiveness of mediation, would he support the public funding of one or two pilot schemes in order to give hard evidence about its claimed effectiveness?

The Lord Chancellor

My Lords, I shall take the second question first. I have given a lot of thought to the question of a pilot scheme. One of the difficulties of an effective scheme is that I believe that it would have to be compulsory, otherwise one does not have a proper sample by which to test the results. As regards the first part of the question concerning legal aid, I believe that, under the present arrangements, it is difficult to contemplate legal aid as available for mediation generally. As the noble Lord knows, in relation to divorce I have proposed the possibility of mediation. One of the difficulties raised with me about that is either one pays both for the mediation and subsequent litigation, or one makes some kind of condition about people who may not have fully used the mediation system at public expense. Then one is accused of having a two-tier system in which people with plenty of money can go directly to the courts whereas those who are litigating on a publicly-funded basis are required to go through mediation. That is a difficulty about the proper answer to the first part of the question.

Lord Ashley of Stoke

My Lords, will the noble and learned Lord consider a situation in which what I may call "a little man" has been denied legal aid and yet wants to take on a large corporation? Will he consider it possible to deprive the large corporation of the right to legal representation if legal aid is denied the "little man" so that there will be fairness as regards arbitration?

The Lord Chancellor

My Lords, there are certain conditions about the award of costs which have a bearing on this matter. If the "little man" is denied legal aid, it is either because he is not little enough to qualify financially or the legal aid board is of the view that his case is not one which has sufficient merit to justify the grant of legal aid. In either of those events, it is quite difficult to think that it would be right to withdraw from the presumed defendant corporation (the large corporation) the ordinary rights which it has in a court of law to be represented. Indeed, strictly speaking, a corporation cannot represent itself, so there are difficulties in that regard. However, I appreciate the sense of the noble Lord's question. It may be that developments in relation to conditional fees may have some help in the situation to which he refers.

Baroness Faithfull

My Lords, does my noble and learned friend support the alternative method of a voluntary body, the conciliation and mediation organisation? That organisation offers a service in the voluntary sector. I believe it has said that the Treasury will not give a grant until the divorce Bill goes through. When it does, can my noble and learned friend say whether that organisation will be considered and whether a grant will be made on an interim basis until that Bill is passed?

The Lord Chancellor

My Lords, there are many highly desirable organisations which come to the Government for funding. If matters were left entirely to me and I had an infinite amount of money, I would feel very happy to support many of them. The difficulty is that when we are dealing not with our own but with taxpayers' money, we have to assign some kind of priority. As regards the family situation, I have set out the views which have commended themselves to me so far for consultation on the possibility of introducing mediation as part of the process on the grounds for divorce. Whether or not a Bill results from that depends on the outcome of the consultation and the extent to which these proposals are supported. I have made it clear in the statement that I made in Glasgow and on many other occasions that I believe very much that there are plenty of opportunities for mediation and other forms of alternative dispute resolution. Judges of the Commercial Court, for example, have made it plain, and they have taken active steps to bring to the attention of the parties involved the possibilities of other methods of dispute resolution. I strongly support that. I think that it is the right way forward in the present circumstances.