Looking back at the Civil Procedure Act and ADR
Two years on from the introduction of the Civil Procedure Act 2010 (the Act), have things changed in terms of dispute resolution or are things much the same? Like all questions posed in this area resolute answers are hard to find because the confidentiality connected to most ADR, keeps things private. However, the legislation clearly should have had some impact.
We revisit the key areas of the Act that relate to dispute resolution as follows:
Chapter 5 of the Act strongly encourages Appropriate Dispute Resolution (“ADR”) or genuine negotiation. This is a change from “alternative” dispute resolution.
The definition of ADR was also expanded in section 3 of the Act. It is a broad and inclusive definition of ADR aimed at being flexible.
In ADR, one must note the following overarching obligations:
- Obligation to only take steps to resolve or determine dispute (s19);
- Obligation to use reasonable endeavours to resolve dispute (s22);
- Obligation to narrow the issues in dispute (s23); and
- Obligation to ensure legal costs are reasonable and proportionate (s24).
Importantly there are also sanctions available for contravening the overarching obligations (s28). The court may impose a costs order for breaching these obligations. Section 29 of the Act enables the court to make certain orders as to costs. The court may also order parties to take steps and make any other order.
The Act also created a legislative basis for courts to actively case manage civil proceedings. Section 47 of the Act states that a court may give any order that is appropriate. A court may refer a civil proceeding, or part of a civil proceeding, to appropriate dispute resolution to resolve or settle the proceeding (s 66(1)).
The importance courts place on ADR is also central to the Act. The Act enhances the capacity of the courts to order that parties participate in non-binding ADR, with or without their consent (s 66(2)).
Sections 48 and 49 of the Act, also limits the time in cross-examining witness, which is also aimed at ADR. It is encouraging the parties to talk more and resolve matters.
However, despite the clear benefits of ADR and the attempt to further encourage ADR the Act does not make ADR compulsory – rather it “encourages it” at all stages. The original pre-litigation components of the Act required parties to participate in ADR prior to the commencement of litigation. This caused much controversy, and it was subsequently repealed after the change of government.
