Alternative dispute resolution (ADR), especially mediation, is now integral to litigation strategy in England and Wales. Courts increasingly scrutinise parties’ ADR conduct when making case management and costs decisions. While sanctions remain discretionary and fact‑sensitive, silence or unreasonable refusal to engage with ADR can carry real costs risk, even for a party that wins at trial.
In this blog post, our dispute resolution team looks at leading court decisions and recent rule changes on refusing ADR, explains what the courts treat as an unreasonable refusal, and sets out how to respond to a mediation invitation without exposing yourself to avoidable costs risk.
Key Authorities and What They Mean
In law, the “authorities” are the decided cases that set the principles judges apply. The decisions below are key authorities that have shaped how the courts treat refusal to engage in ADR and what that can mean for costs.
PGF II SA v OMFS Co 1 Ltd [2013] EWCA Civ 1288
The Court of Appeal held that silence in the face of a proper invitation to mediate is, in itself, unreasonable. The successful party’s costs were reduced because it failed to respond at all. The decision establishes that ADR conduct is part of reasonable litigation behaviour under the overriding objective. Silence may be treated as refusal and attract costs consequences.
Thakkar v Patel [2017] EWCA Civ 117
The Court of Appeal criticised delay and foot‑dragging over arranging mediation. Although the parties had indicated some willingness, one side’s procrastination meant mediation did not occur in time; that conduct was treated as unreasonable and affected the costs outcome. The lesson is that engagement must be timely and practical, not merely lip service.
Garritt‑Critchley v Ronnan [2014] EWHC 1774 (Ch)
The High Court ordered indemnity costs against a party that unreasonably refused mediation where settlement was realistically achievable. Indemnity costs are not automatic, but persistent, unjustified resistance to ADR in a case apt for settlement can justify them.
Halsey v Milton Keynes General NHS Trust [2004] EWCA Civ 576
Halsey remains relevant on factors for assessing whether a refusal of ADR was reasonable. The burden lies on the party asserting unreasonableness to show it. Factors include the nature of the dispute, merits, prospects of ADR success, timing, whether ADR would cause disproportionate delay or cost, prior attempts at ADR, and whether a point of law requires determination. These factors are applied flexibly and contextually.
Churchill v Merthyr Tydfil County Borough Council [2023] EWCA Civ 1416
The Court of Appeal confirmed that courts can stay proceedings and require parties to engage in ADR, provided the order is proportionate and does not impair the essence of the right to a fair trial or prevent access to the court. Churchill clarifies that Halsey does not prohibit court‑ordered ADR. The court will consider suitability, proportionality, timing and fairness when deciding whether to direct ADR.
CPR Updates From 1 October 2024
Amendments to the Civil Procedure Rules from 01/10/2024 expressly reference:
- the court’s case management powers to order or facilitate ADR; and
- parties’ engagement with ADR as part of conduct relevant to costs.
These amendments reflect and reinforce the authorities above. They do not make ADR mandatory in every case; they position ADR within active case management and costs assessment, with sanctions remaining discretionary.
These amendments reflect and reinforce the authorities above. They do not make ADR mandatory in every case; they position ADR within active case management and costs assessment, with sanctions remaining discretionary.
What Amounts to Unreasonable Refusal?
Courts do not require ADR in every case. A refusal may be reasonable where there is a clear point of law to be determined, ADR has no real prospect of success on the evidence, earlier ADR has genuinely failed, or timing makes ADR impractical. However, the following are repeatedly treated as high‑risk: failing to respond to ADR invitations (PGF), delaying or obstructing arrangements (Thakkar), and blanket or tactical refusals in cases suitable for settlement (Garritt‑Critchley).
Costs Consequences: Even If You Win
Unreasonable conduct concerning ADR can lead to reductions or disallowance of otherwise recoverable costs, adverse costs orders for stages of the case, or, in serious cases, indemnity costs. Outcomes are discretionary and turn on the facts, but courts now routinely examine ADR behaviour when deciding costs.
Practical Takeaways
- Treat ADR as a live, early case management issue. Consider suitability, timing, and format.
- Respond promptly and substantively to any ADR invitation. Silence is risky after PGF.
- If refusing or seeking to defer ADR, give clear, evidence‑based reasons, grounded in Halsey factors.
- Avoid delay and foot‑dragging. Make concrete proposals on mediators, dates, and format (Thakkar).
- Keep a clear paper trail: invitations, responses, reasons, and alternative proposals.
- Consider proportionate alternatives if full mediation is not apt, such as an early neutral evaluation, an issue‑focused session, or a time‑limited mediation.
Checklist: How To Handle an ADR Invitation
- Acknowledge promptly and confirm availability windows.
- Assess suitability against Halsey factors and record your analysis.
- If not accepting, propose an alternative ADR process, timing, or scope.
- Explain reasons succinctly and attach any key documents underpinning your position.
- Diary follow‑up steps and keep evidence of all correspondence and offers.
Dispute Resolution and Mediation Lawyers London
Our dispute resolution team are here to help you weigh up ADR, manage costs risk, and respond to mediation invitations with confidence, whether you are considering an offer to mediate or deciding how to respond to one.
Yvonne Addy, who heads the firm’s Dispute Resolution team with Andrew Wheldon, is a highly experienced civil, commercial and property litigator, as well as an ADR Group Accredited Civil and Commercial Mediator. Her approach is calm, focused and solution-driven, helping parties navigate difficult issues and move towards workable outcomes.
To learn more about the mediation process and what to expect, please read our recent article:
Mediation FAQs – What You Need to Know.
For more information or to speak to one of our team, email us at contact@muscattblackgraf.com or click here to complete our online contact form.
This note provides general information on ADR, costs, and case management in England and Wales, it is not legal advice and should not be relied upon as such. Specific advice should be taken on particular facts. This blog was published in June 2026, and information may have changed since publication.