Order 5 – Game Changer or Paper Tiger?
Credit: Raddison US (unsplash)
Introduction
With great fanfare on 1 December 2021 Singapore announced a new set of civil procedure rules, the Rules of Court 2021 (ROC 2021).
The new rules built on a public consultation that ran from 26 October 2018 to 31 January 2019 and were, according to the Courts’ Media Release, intended to “transform the litigation process by modernising it, and enhancing the efficiency and speed of adjudication, while maintaining legal costs at reasonable levels.” Central to the new rules was the simplification of rules, modernising of language, streamlining of procedures and enabling greater judicial control of suits.
One innovation was the creation of a duty requiring parties to consider amicable resolution of their disputes before and during the litigation process. Compliance with this duty was to be taken into account by the court when considering costs.
Amicable resolution can be achieved by parties trying Alternative Dispute Resolution (“ADR”) and/or through making written or oral offers. In the context of the ROC 2021, attempts to resolve disputes amicable are invariably contained in Offers of Amicable Resolution (“OAR”).
A duty to consider amicable resolution up front and throughout the litigation process ought to be beneficial to insurers as it should allow for matters to be settled earlier with concomitant cost savings. However, the author’s own experience shows that litigation is often commenced without any offers being made. Further, reported costs decisions have yet to establish clear precedents on how such failure to consider pre-action or early amicable resolution should be punished. This article gives some thoughts on how the litigation framework may be strengthened to facilitate early settlement of disputes.
What the Rules Say
Order 5 rule 1 sets out the duty to consider amicable resolution of disputes. The duty has four components:
“A party to any proceedings has the duty to consider amicable resolution of the party’s dispute before the commencement and during the course of any action or appeal.
A party is to make an offer of amicable resolution before commencing the action unless the party has reasonable grounds not to do so.
An offer of amicable resolution in this Order means making an offer to settle the action or appeal or making an offer to resolve the dispute other than by litigation, whether in whole or in part.
A party to any proceedings must not reject an offer of amicable resolution unless the party has reasonable grounds to do so.”
Order 5 rule 2 then goes on to explain that an offer of amicable resolution must be in “in writing” and must be open for acceptance for “a reasonable period of time and in any case, for at least 14 days unless the parties otherwise agree”. Unlike the rules concerning Offers to Settle (OTS) under the old rules of court, the ROC 2021 does not set out strict requirements for the formalities and contents of the offer.
Under Order 5 rule 3, the Court has the power to “order the parties to attempt to resolve the dispute by amicable resolution”. A party can refuse to participate but must submit a “sealed document setting out the party’s reasons for such refusal”. This document will be opened by the Court after the determination of the merits of the action or appeal and its contents may be referred to on any issue of costs.
The potential cost consequences of making (or not making) an OAR are set out in Order 21 of the rules of court. Order 21 rule 2(2) says that when exercising its power to fix or assess costs, “the Court must have regard to all relevant circumstances”, including, amongst other things “efforts made by the parties at amicable resolution”. Order 21 rule 4 provides that the “Court may disallow or reduce a successful party’s costs or order that party to pay costs, if …. (c) that party has not discharged that party’s duty to consider amicable resolution of the dispute or to make an offer of amicable resolution in accordance with Order 5…”
What did the drafters of the rules envisage?
Order 3 rule 1 says that the Rules are “to be given a purposive interpretation” and that the rules seek to achieve five ideals, namely (a) fair access to justice, (b) expeditious proceedings (c) cost efficiency, (d) efficient use of court resources and (e) fair and practical results that are suited to the needs of the parties. Sub-rule 3 mandates that “the Court must seek to achieve the Ideals in all its orders or directions”.
Looking at the language used in Order 5, it is clear that the drafters intended that all parties to a litigation would consider amicable resolution of their disputes before filing of process and throughout the lifespan of their dispute. Parties’ efforts would be taken account in cost decisions under Order 21.
It can be inferred from the absence of strict format requirements that Order 5 offers were envisaged to be nimbler than the old OTS system and that cost consequences could flow even from
Apart from the wording of the Rules of Court, insight into what was envisaged can be gained from the reports issued by two committees set up to consider civil justice reforms
The Civil Justice Review Committee (“CJRC”) established by the Ministry of Law
Civil Justice Commission (“CJC”) established by the Chief Justice, Sundaresh Menon
The CJRC at [83] to [87] of its report expressed the view that “Parties should be directed to consider ADR as a first step before commencing proceedings in court” and that there should be “more robust use of cost sanctions to discourage unreasonable refusals to attempt ADR or reach an amicable resolution of the matter”. The CJRC went on to justify its recommendation that parties should consider ADR by stating that “while the court-based approach to dispute resolution has its strengths, it may not always be the most appropriate mode in every case. While ADR may not necessarily lead to settlement in every case, it will provide a forum for parties to ventilate key issues. Even if this only results in a narrow scope of agreement, it may aid in moving the case forward by reducing the issues in contention.”
The CJC, commenting on the draft rules, stated that “parties have to give sufficient consideration to resolving disputes amicably before commencing or during the course of any action or appeal”.
From these various sources, I suggest that the drafters of ROC 2021envisaged
Litigation is no longer to be considered as the default mode of dispute resolution
Litigation should now be the course of last resort.
Further, when one considers the wording of Order 21 rules 2(2)(a) and 4(c) and how the previous OTS scheme worked, I would suggest that it was envisaged that non-compliance would resonate in cost penalties.
Benefits of early settlement
From an insurer's perspective, early settlement can deliver significant benefits. Resolving a claim at an early stage often contains legal costs and frees up the substantial time required to oversee a litigation. It also limits the uncertainty inherent in court proceedings, where outcomes can be difficult to predict and adverse judgments may exceed expectations. Early settlement therefore allows insurers to control both costs and litigation risk more effectively.
There can also be commercial and reputational advantages to early resolution. Policyholders are often more satisfied when claims against them are resolved promptly and without the stress, inconvenience and distraction of lengthy legal proceedings. This can strengthen the relationship between insurer and insured. Amicable resolution can also preserve relationships between the parties to a dispute.
That said, early settlement is not always possible or, indeed, desirable. At an early stage, the facts may be unclear and further investigations may be required before a fair assessment can be made. There will also be cases where an early settlement would require the insurer to pay more than can be justified or to compromise a strong defence.
What is happening in practice
In the author’s own experience, disputes have been settled at an early stage due to strategic use of Order 5 offers. However, this is the exception and not the norm.
It is more common for disputes to escalate in the way that they did under the old rules of court, with parties exchanging letters of allegation and denial before filing pleadings and moving into the litigation process without considering amicable resolution. In fact, the author has seen litigations being commenced without letters of demand being sent, let along pre-action offers being made. Sometimes where parties have considered their Order 5 duty, their ‘offers’ have been mere invitations for the other side to make the first move.
In 2026 (i.e. three years after the ROC 2021 came into force), is common to see parties first addressing their duty to consider amicable resolution during a case conference after litigation has been commenced.
Several factors may explain this state of affairs. In some cases, a party may feel unable to formulate a meaningful offer at an early stage because there is a significant asymmetry of information. For example, in a personal injury case, the Claimant often possesses the key documents like medial reports, but may not yet have disclosed them or may not have allowed the Defendant’s expert to do a medical re-examination. In such circumstances, the Defendant may legitimately consider that further information or investigation is necessary before any realistic settlement position can be adopted.
There may also be cultural and professional factors at play. Many practitioners were trained under the previous litigation paradigm, where settlement discussions often followed the exchange of pleadings or affidavits rather than preceded them. Such practitioners may be reluctant to all their client to make the first offer for fear of appearing weak or conceding bargaining advantage. Others may feel that the pleadings must first crystallise the issues in dispute before the parties can properly evaluate the strengths and weaknesses of their respective cases. As a result, amicable resolution may only be considered later in a litigation.
Emergence of Jurisprudence on Order 5
Reported costs decisions on the effects of making (or not making) an OAR are few and far between. This may be explained by the fact that only a fraction of litigations end up with reported judgments and it is possible that there have been unreported cases in which parties have been penalised for not attempting amicable resolution.
In this section I set out summaries of several publicly reported cases to see what trends can be deduced. I have not included family law matters where amicable resolution is well entrenched.
Cases:
Maxx Engineering Works Pte Ltd v PQ Builders Pte Ltd [2023] SGHC 71,
The court found that the parties were under a contractual obligation to refer their dispute to mediation and that pursuant to this obligation, the Claimant should be granted an order for specific performance to compel the Defendant to refer the dispute to mediation. The court held that the contractual terms gave rise to a legal obligation to mediate and that it was just and equitable to order specific performance of this obligation. One factor in favour if it being ‘just and equitable’ to order specific performance was the trend towards the promotion of ADR, which is reflected in the ROC 2021. The judge was also of the view that the mediation process would provide both parties with the opportunity to resolve their dispute without incurring further legal costs or substantial delay, and the judge took into account that parties had agreed that their dispute should be mediated.
QBE Insurance (Singapore) Pte Ltd and Anor v Relax Beach Co Ltd [2023] SGCA 45
The Respondent hotel company was asking the court to award them costs on an indemnity basis rather than the standard basis. The Respondent argued that their insurers made no effort whatsoever to amicably resolve the liability dispute even when invited by the Court to attempt alternative dispute resolution. This is despite the appellant insurers having lost in the proceedings below. The court agreed that this was an issue that it must take into mind, but ultimately decided that on the facts of the case there was no basis on which to depart from the standard basis of costs.
Zou Xinye v Ang Eileen and another [2024] SGMC 9
In Zou Xinye the defendants sought to strike out the Claimant’s claim on the basis that the Claimant did not make an OAR before commencing the action, in breach of Order 5 rule 1(2). District Registrar Koh Jiaying held that the failure to make an OAR resolution should not result in the striking out of the Claimant’s claim. In her view, “do so would be a denial of justice and would in fact go against the Ideal of fair access to justice”. Instead, “whether a party has made an offer of amicable resolution or attempted to resolve the dispute by amicable resolution, and whether refusal to do so is reasonable, are factors that the court can take into consideration when determining the issue of costs at the conclusion of the matter.” The learned Deputy Registrar was of the view that the non-compliance can be compensated by costs, and it would be appropriate for the court to consider the issue of costs at the conclusion of proceedings when it could be better assessed if the Claimant had reasonable grounds for not making an offer of amicable resolution.
Chia Hsien Leng, Ayron v Fasten Enterprises (Pte) Ltd and others [2024] SGDC 324
The claim arose from a dispute between the Claimant and his parents concerning the family business. The Claimant commenced an action for unpaid director fees which he said were owed to him. The Defendant (the company) contested the claim, arguing that it had used the directors fees to set off certain expenses incurred by the Claimant. The Claimant then added his parents in a third parties to seek an indemnification for the set-off expenses.
At the end of the trial, the District Judge held that the Claimant was entitled to $175,000.00 directors fees, but the Defendant was entitled to set off a sum of $96.650.66 for expenses incurred by the Claimant. The total amount to be paid to the Claimant was $78,349.34. The judge dismissed the Claimant’s claim against his parents.
Although the Claimant was successful, the Defendant had offered $100,000 before the trial (referred to as the First Offer to Settle) and later discussed settlement at $150,000 all-in (referred to as the Second Offer to Settle). As these were more favourable than the end result, the District Judge was of the view that the normal cost consequences should be reversed for the post-offer period.
The Defendant was thus ordered to pay costs on a standard basis up to “the First Offer to Settle and Second Offer to Settle” and the Claimant to pay costs on an indemnity period thereafter. The judge said “It was not necessary for me to decide from which of the two offers indemnity costs should run because parties did not suggest that they had incurred significant cost in that period. Both offers were made shortly before trial. By then parties had filed and exchanged witness statements. Most of the pre-trial work had been completed.”
Wang Bin v Zhong Sihui [2024] SGHC 189
The Claimant was seeking to enforce a Chinese arbitration award against the Defendant in Singapore. The Defendant sought to set aside the Enforcement Order on the basis that she did not have proper notice of the underling arbitration proceedings. After Judicial Commissioner Wong Li Kok Alex dismissed the Defendant’s set-aside application, the Claimant sought costs from the Defendant on an indemnity basis. Reliance was placed on an ADR offer in which the defendant was invited “to make full payment under the Enforcement Order without further interest, legal costs and disbursements after 5 February 2024”.
The learned Judicial Commissioner, however, agreed with the defendant that the ADR offer was not a reasonable or serious offer. This was because the offer:
(a) was made on the same day that the Claimant filed his second affidavit and before the Defendant considered her own additional affidavit
(b) was also only open for 14 days.
(c) did not contain a sufficient element of compromise to induce a settlement.
With regard to the Defendant’s conduct in rejecting the offer, the Court found that it did not breach the high threshold for ordering indemnity costs. This was because the defendant had brought a narrow case for setting aside the Enforcement Order and its approach and arguments were not implausible or unreasonable.
The learned Judicial Commissioner therefore ordered costs on a standard basis in favour of the Claimant.
Cheng Shi Ying Cherissa v Khoo Chong Kiat and another [2025] SGHC 91
This costs decision arose from a medical malpractice claim in which the Claimant failed to prove her case. The Defendants had sought costs of $350,000. In support of this figure they pointed to the fact that the Claimant had rejected the Defendants’ offers to settle. The Defendants also alleged that the Claimant was “not truthful about her [medical] condition” and “displayed no sincerity at all in reaching a settlement”.
The court considered parties attempts to settle but did not attach any weight to the offers as the parties had been far apart in their views. The Judge said:
“It seems to me that both parties had made efforts to reach an amicable resolution, but their respective ideas of what a reasonable sum should be to settle amicably were just too far apart. The claim was neither complicated nor complex. The documents filed were not voluminous. In Chia Soo Kiang, the claimant refused the defendants’ offer to settle and made no counteroffer. He also filed affidavits without leave and made major amendments to his claim a week before the trial commenced. The trial took eight full days and two half days, and the defendants had to pay for the transport and accommodation of their witnesses from overseas. Chia Soo Kiang can be distinguished from the present case, where the claimant had made efforts to mediate as well as offers to the defendants to settle the matter thereafter.”
Armira Capital Ltd v Ji Zenghe and others [2025] SGHCR 18
The Applicant had filed a Bill of Costs for the assessment of its costs pursuant to the three court orders that it had the benefit of. In the course of considering costs for the application, the court looked at efforts made by the parties to settle the costs dispute amicably. The court noted that the Applicant had sent a letter of demand on 5 December 2024 but had proceeded to file the application on 27 December, notwithstanding the Respondent asking for more time to respond on 16 December. Clients. The applicant justified this action by saying it was necessary to beat the 1 year time bar for assessment of costs and the Court held that it was reasonable to have filed the application without exploring ADR first.
Chong Jorina v Ritz Property Investimentos Imobiliarios Ltda and another [2026] SGHC 148
This action arose out of an investment scheme that the First Defendant had promoted. Under the scheme, interests in plots of land in Brazil were sold through a chain of intermediaries to retail investors in Singapore and Taiwan. The Claimant was one intermediary. She sued the Second Defendant for mis-representation but lost and had to pay costs to the Second Defendant.
The Claimant argued that the Second Defendant should be deprived of its costs because, amongst other things, the Claimant had made settlement overtures by participating in a full-day mediation in April 2024 and by exchanging of settlement terms in October 2024 and April 2025. The Claimant’s arguments failed and the court declined to alter the normal flow of costs.
Judge Vinodh Coomaraswamy gave no weight to the settlement overtures. This was because the content of the discussions at the mediation and of the settlement terms exchanged were not before the court and therefore the Judge could comment on whether the Defendant acted reasonably or unreasonably in not responding to the overtures. However, the Judge did go on to say that in any case since “the Claimant lost this action outright” the defendant was vindicated in not accepting any offer! To quote the judge in full:
65 In any event, the claimant lost this action outright. It is a reasonable inference that any settlement overtures involved the defendant paying to the claimant a non-zero sum to settle this action. The defendant refused to do so, went to trial and won an unqualified vindication. If the overtures point anywhere at all on the issue of costs, they point in the defendant’s favour, not in the claimant’s favour. Whether the claimant was or was not genuine in making or participating in these settlement overtures is no longer to the point. Events have demonstrated that the defendant was correct, and therefore acted reasonably, in not responding to the probable contents of these overtures and in refusing to pay the claimant a non-zero sum to settle this action.
Interestingly, there is no mention in the case report of the Defendant making any offers. The case report only mentions that the Defendant attended a mediation.
Lee Cheng Mui v Lee Say Yng [2026] SGHC(A) 13
The parties were siblings and tenants-in-common of a property which was at the centre of this dispute. During a break in the trial, the first instance judge asked parties to attempt amicable resolution of their dispute but they declined to do so. The judge then proceeded to reach a decision. He allowed the Respondent’s claim in part and awarded costs to the Respondent.
On appeal, the Appellant argued that the Judge failed to take into account factors which either should have resulted in the Respondent paying costs to the Appellant, or the costs ordered to be paid by the Appellant to the Respondent being substantially reduced or even nullified. The appeal court rejected these arguments. As the Respondent was the successful party, they were entitled to costs unless there were circumstances that warrant a different result. On the facts there was no reason to alter the normal flow of costs. Further, the appeal court was satisfied that the Judge had considered all relevant circumstances. Whilst the Appellant hade made an offer of amicable resolution, it was in relation to HC/OA 928/2023 (which was an application to sell the Property). It therefore is not relevant to costs in OC 867 (which was the main dispute). The only offer from the Appellant in relation to OC 867 was for the Respondent to discontinue the action with costs to be reserved. The offer to mediate “was raised before the Judge and it was considered by the Judge”. The appeal court therefore upheld the Judge’s decision to award costs against the Appellant.
Nirmala d/o Thangavellu v Acestes Pte. Ltd. [2026] SGDC 195
The Claimant injured her ankle while working as a security officer at a condominium and sued her employer. The claim was unsuccessful.
The Defendant sought costs on an indemnity basis, relying on an OAR that it served on the Claimant before the trial. The District Court held that the offer was insufficient to alter the normal flow of costs. The terms of the offer were that the Claimant shall discontinue the action and pay the Defendant’s costs and disbursements. District Judge Evans Ng opined that such an offer “means the Claimant is to yield fully” and was “the antithesis of a compromise”. This is because the offer “lacks any element that would induce or facilitate settlement and cannot be considered a ‘genuine’ offer”. Further it was also “hard to tell how the offer’s terms are more favourable to the Claimant than the judicial outcome”. The offer therefore failed to alter the Defendant’s entitlement to costs on the standard basis.
Given that only a pre-trial offer was mentioned, it would appear that neither party made offers of amicable resolution prior to the commencement of the suit. The Claimant’s motives for not making an offer were not considered by the court.
Shariffah Zaiton Binte Syed Agil Alsagoff v. Rita Zahara Binte Mohamed Nazeer [2026] SGDC 127
DC/SUM 336/2026 was an application by the Defendant to set aside a regular judgment entered in default of appearance. The court allowed the application and ordered that costs be in the cause (rather than the typical costs to follow the outcome of the application). The Claimant appealed against the cost order.
The appeal judge expressed the view that the Five Ideals in Order 3 requires parties to objectively assess the strengths and weaknesses of their cases when deciding whether to pursue or defend any applications. This is to avoid unnecessary expense and use of resources by parties and the Courts.
Whilst the Claimant had regularly entered default judgment there was obvious merits in the setting aside application. As such, the refusal of multiple offers for amicable resolution by the claimant incompatible with Five Ideals. The court took this “conduct into consideration… in making the cost order”, but did not provide any granularity as to how the conduct affected the costs award.
Lao Iok Sim (alias Liu Yuchan) v United Overseas Bank Ltd [2026] SGHCR 36
The Claimant was the victim of a scam and sued the Defendant bank. The Defendant successfully applied to strike the claim out. The Claimant appealed unsuccessfully. One argument raised on appeal was that the Defendant had conducted the litigation unreasonably, including filing a striking out application very shortly after receiving the Claimant's offer to settle. Assistant Registrar Ramu Miyapan rejected the argument. The time of the filing in and of itself could not be construed as bad faith - given the circumstances in which the defendant found itself, the Defendant could not be faulted for bringing this application as it had legitimate grounds to do so which the timing did not negate.
James Jonathan v Adel Ng [2026] SGMC 106
The parties were formerly married. The ex-husband inadvertently transferred money to his ex-wife. He emailed her multiple times to ask for the money back. He then appointed lawyers to write a letter of demand. The dispute then escalated to litigation. After a trial, the court ordered the ex-wife to make recompense.
Although she lost, the ex-wife argued for costs in her favour as she had made an OAR. The court placed little weight on the offer. This was because the offer letter had contained serious allegations against the Claimant including that “the proceedings were brought against her unnecessarily and for improper motive”, and that the “Claimant’s commencement of these proceedings are an abuse of process”. The court opined that “while genuine efforts by one party at trying to reach an amicable resolution can be taken as a factor in favour of that party, the content and context of the Defendant’s offers in this case do not support a favourable finding for the Defendant.” Costs were thus ordered to follow the event (i.e. the Claimant/ ex-husband was awarded costs in his favour).
As to what principles can be distilled from the limited reported decisions, I suggest the following:
Reported costs decisions in which the court considers Order 5 are becoming more common
Reported decisions in which courts expressly consider Order 5 and parties' efforts at amicable resolution are becoming increasingly common. This trend is expected as passage of time makes it more common for decisions on a particular rule to arise.
Making (or not making) and Offer of Amicable Resolution can have cost consequences
The cases confirm that parties' conduct in relation to amicable resolution is a relevant consideration in costs decisions.
In Fasten Enterprises and Shariffah Zaiton, the courts took parties' settlement conduct into account when determining costs. In Fasten Enterprises, the rejection of more favourable settlement offers resulted in the usual costs consequences being reversed for part of the proceedings. In Shariffah Zaiton, the court expressly considered the claimant's refusal of multiple offers of amicable resolution when making its costs order.
Conversely, in QBE v Relax Beach, the Court of Appeal accepted that a failure to engage meaningfully in amicable resolution was a relevant consideration in principle, although the facts ultimately did not justify any departure from the ordinary costs order.
An OAR must involve a genuine compromise and court will not automatically penalise rejection of an offer, but will instead consider the merits of the offer and a party's ultimate success at trial
The emerging jurisprudence suggests that the courts will not mechanically reward a party simply because an offer was made.
In Wang Bin, Nirmala and James Jonathan, the courts declined to attach significant costs consequences to settlement overtures because they were not viewed as genuine attempts at compromise. The cases suggest that an effective OAR should contain a real element of compromise capable of inducing settlement. An offer which merely requires the other party to capitulate, is made before the recipient has a fair opportunity to assess the case, or is accompanied by unnecessarily hostile allegations may attract little or no weight.
The courts have also shown a willingness to consider the broader context of the dispute. In Lao Iok Sim and Chong Jorina, substantial weight was attached to the merits of the parties' positions and their ultimate success in the litigation. This suggests that the reasonableness of rejecting an offer cannot be assessed in isolation from the substantive merits of the dispute.
Failure to make an OAR will not automatically result in costs sanctions
To date, there appears to be no reported decision in which a successful party has been deprived of costs solely because it failed to make an OAR or otherwise engage in amicable resolution.
The cases confirm that the duty is not absolute. In Armira Capital, the court accepted that it was reasonable to commence proceedings without first pursuing amicable resolution because the applicant needed to avoid an impending limitation period.
Courts are adopting a contextual rather than formulaic approach
Perhaps the most significant trend is that courts have generally resisted treating Order 5 as creating automatic outcomes. Rather than applying a rigid rule that every rejection of an OAR attracts adverse costs consequences, or that every failure to make an OAR warrants sanction, the courts have consistently examined the particular circumstances of each case. Factors such as the genuineness of the offer, the extent of compromise, the merits of the underlying dispute, the parties' conduct throughout the proceedings and any practical constraints on settlement efforts have all featured in the analysis.
What can be done to improve the frequency of pre-action or early amicable resolution
I contend that the introduction of pre action to discovery would help to reduce instances when parties feel unable to make offers because they cannot adequately gauge their exposures. For ADR to be effective there is often a need to know what evidence is available so that a proper assessment of litigation risks can be done (institutional clients will often need a written advice before giving settlement mandate). The problem facing litigants in Singapore is that there are very few obligations to give discovery upfront.
For Magistrates Court and District Court cases, Order 65 ROC 2021 requires litigants to give upfront production of documents that (a) the party in question will be relying on, (b) known adverse documents and (c) any further documents that parties have agreed to disclose. But this obligation is only activated when pleadings are filed.
The State Court Practice Directions contains pre-action protocols for certain types of dispute and some of this require pre-action production of documents. For example, Appendix A (Protocol for medical negligence) seeks to “prescribe a framework for exchange of information prior to the filing of an Originating Claim with a view to resolving medical negligence disputes arising out of an alleged negligent act or omission in connection with medical or dental diagnosis or treatment without protracted litigation.” For Appendix B (protocol for personal injury claims and non-injury motor claims) parties are to consider using Single Joint Experts which, since they owe duties to both parties, such experts will be in a place to provide information. The claimant must also provide certain documents to the Defendant’s which allows the Defendant to access the case.
For High Court matters, there is no obligation to give pre-action or upfront discovery. Further, since the court often asks parties to consider ADR at the first Case Management Conference and production of documents will not be ordered until later in proceedings, parties are being asked to consider mediation without a means to get the documents they need. The protocols both say that the court can take into account non-compliance when assessing costs.
Surprisingly, the Supreme Court Practice Directions (applicable to the High Court) only contain a pre-action protocol for medical negligence cases.
A better system would require all parties to disclose at least the documents that they are relying on up front. Parties ought to then be given a fixed time before attempting amicable resolution.
As to what innovation could be made, inspiration may be taken from England & Wales where the Civil Procedure Rules contain more than a dozen different pre-action protocols, each targeting a different type of claim. The Pre-Action Protocol for Personal Injury Claims contains lists of documents which may be disclosed. Para 7.1.3 of the Protocol then says:
“Pre-action disclosure will generally be limited to the documents required to be enclosed with the Letter of Claim and the Response. In cases where liability is
admitted in full, disclosure will be limited to the documents relevant to quantum, the parties can agree that further disclosure may be given. If either or both of the parties consider that further disclosure should be given but there is disagreement about some aspect of that process, they may be able to make an application to the court for pre-action disclosure under Part 31 of the CPR. Parties should assist each other and avoid the necessity for such an application.”
The Pre-action Protocol for Professional Negligence Claims does not list out potentially relevant documents, but does say the following
10.1 This protocol is intended to encourage the early exchange of relevant information, so that issues in dispute can be clarified or resolved. The claimant should provide key documents with the Letter of Claim and (at any time) any other documents reasonably requested by the professional which are relevant to the issues in dispute. The professional should provide key documents with the Letter of Response, to the extent not provided by the claimant, and (at any time) any other documents reasonably requested by the claimant which are relevant to the issues in dispute.
10.2 Parties are encouraged to cooperate openly in the exchange of relevant information and documentation. However, the protocol should not be used to justify a ‘fishing expedition’ by either party. No party is obliged under the protocol to disclose any document which a court could not order them to disclose in the pre-action period under CPR 31.16.
10.3 This protocol does not alter the parties’ duties to disclose documents under any professional regulation or under general law.
Both protocols say that non-compliance can be taken into account by the courts. This is echoed by Part 44.2 which states that “In deciding what order (if any) to make about costs, the court will have regard to all the circumstances, including ….(a) conduct before, as well as during, the proceedings and in particular the extent to which the parties followed the Practice Direction – Pre-Action Conduct or any relevant pre-action protocol… (e) whether a party failed to comply with an order for alternative dispute resolution, or unreasonably failed to engage in alternative dispute resolution”
The second change which will improve the frequency of early settlement will be harder to achieve. It is a mindset change. In my view, a significant issue is that many practitioners continue to approach disputes through a pre-ROC 2021 lens where litigation was viewed as the default means of resolving disputes and settlement discussions were often deferred to after the exchange of affidavits. This mindset sits uneasily with the philosophy underlying ROC 2021 where the rules contemplate that parties should actively consider amicable resolution before proceedings commence and throughout the life of a dispute
The reported decisions suggest that the courts are prepared to consider parties' settlement conduct when dealing with costs, but have thus far exercised that power cautiously. If the courts were to impose more substantial costs consequences in appropriate cases for unreasonable failures to engage with amicable resolution or for a failure to comply with the duties imposed by Order 5, behavioural norms would likely evolve. As occurred with the introduction of the former Offer to Settle regime, practitioners would adapt their practices to reflect the litigation risks associated with non-compliance. Over time, the focus would shift from asking whether a party should attempt amicable resolution to asking whether there is a good reason not to do so.
Conclusion
The duty to consider amicable resolution before commencement of proceedings appears to be a duty more honoured in the breach than in the observance. It is submitted that strengthening pre-action protocols to require up front discovery would correct this. This would be beneficial to insurers, who are often in positions where they would like to settle cases early but are not given the necessary offers and supporting documents for them to do so.
Donald Spencer
ILAS President