There has been a lot of excitement about this Court of Appeal case due to the possibility that it might have resulted in members of the public being denied access to the courts and instead being required to pursue redress of their grievances through ADR or the internal complaints procedures of local authorities or other public bodies such as housing associations. This has meant that the stakes have been very high which in turn has meant that in addition to the two original parties there were no less than seven intervenors and thirteen barristers taking part in the final hearing.
The intervenors included the Social Housing Law Association, intervening in the case no doubt to try and persuade the court to bar as many of their members' tenants as possible from the courts, and their rivals, the Housing Law Practitioners Association, presumably trying to ensure complete freedom of access to the courts.
I should just add here that ADR stands for Alternative Dispute Resolution, which can be summarised as meaning ways of resolving disputes without going to court. For more information about ADR see this post on Which.co.uk. For the purposes of this post, an internal complaint and a complaint to the Ombudsman are treated as ADR.
In the event, the case turned out to be a bit of a disappointment for both sides. The Court of Appeal held that while it is possible for the Courts to require the parties to use ADR, the question of whether they will do so will depend on the circumstances of each case. This means that there will have to be many further cases to enable us to obtain guidance as to when it would actually be appropriate for a Court to require a case to be dealt with by way of ADR.
The Facts of The Case
Mr Churchill issued County Court proceedings against Merthyr Tydfil County Borough Council because of damage to his home caused by Japanese knotweed, which was getting onto his land from adjoining council-owned land. The council applied for a stay of the proceedings on the basis that Mr Churchill should have made use of the council’s complaints procedure rather than issuing Court proceedings
The County Court Judge dismissed the council’s stay application. He held that he was bound to follow Dyson LJ's statement in Halsey v. Milton Keynes General NHS Trust  to the effect that: "to oblige truly unwilling parties to refer their disputes to mediation would be to impose an unacceptable obstruction on their right of access to the court." The council appealed. The Court of Appeal held that Dyson LJ's comments were not binding, and the courts have the power to stay proceedings and require the parties to use ADR. However, the Court did not say when they should do so or even whether Mr Churchill should be required to do so. They referred the matter back to the County Court. It will be interesting to see if next time around the County Court does stay the proceedings. I suspect that they won't, if only because the case has been going on for so long now that it might as well stay in the court,
The Background To The Case: Complaints Procedures Which Are Not Fit For Purpose
I think that everyone will agree that it would be best if problems faced by people dealing with public bodies were resolved quickly and cheaply by an accessible, fast, and decisive complaint procedure rather than having to use the courts.
For instance, if nobody at your housing association landlord’s offices is responding to your complaints about mould in your housing association flat a complaint would result in somebody getting back to you to apologise for the lack of response, get the mould dealt with, and perhaps offer you some compensation for the problem.
Alternatively, if you apply to a local authority for accommodation as a homeless person but are not provided with temporary accommodation, a complaint might result in somebody providing accommodation and an apology or explaining why this cannot be provided.
To continue to contemplate the ideal situation, if the complaints were not dealt with satisfactorily at the first stage then they would be quickly escalated to a more senior member of staff who could resolve the problem as quickly as possible. Then if the internal complaints procedure did not work the matter could quickly be referred to an Ombudsman who could investigate and deal with the complaint.
Ideally this procedure from first complaint to Ombudsman decision should be completed within a matter of days. There is no point in making a complaint about being homeless if you have to wait longer than this for a decision. Slightly longer may be acceptable for housing disrepair but not more than a few weeks.
In the real world, complaints are dealt with slowly such that it may take months for the Ombudsman to consider a complaint by which time the subject matter of the complaint may only be of historical interest. There is also the problem of staff in a public body dealing with complaints about their own organisation being biased against the complaint. This means that people do not seriously expect internal complaints and the Ombudsman to be able to deal with a matter being complained of in time to get it resolved. As such, people turn to the Courts for faster and fairer dispute resolution.
Let’s take, for instance, Lambeth Council’s complaints procedure. I think that even Lambeth’s strongest supporters will have to concede this council has a long history of very low standards of service provision and badly needs an effective complaints procedure. The council’s website describes it as a simple, two-stage process. Those two stages are Local Resolution and Final Review.
Lambeth’s target for providing a full response to written response to an initial or local resolution complaint is 20 working days or 4 weeks, but the web site warns that it may actually take longer than this to respond. The target for providing a response to a second stage or Final Review complaint is 25 working days or 5 weeks, but again, the web states that this may take longer.
If you need to escalate a complaint to an Ombudsman, this will take further time. The Housing Ombudsman website says that their average investigation time is around six months, with 99% of cases completed within 12 months. The Local Government Ombudsman says that most investigations take 3 months to complete, but some more complex ones may take longer. It is not clear if this includes the 20 working days that they state that it will take for them to let you know if they will deal with your complaint.
In my experience, one should not expect to receive a response to a complaint until very close to the target date. These targets mean that at Lambeth an internal complaint is likely to take nearly a month to deal with at stage one or two months if it needs to go to the second stage, or five months if you need to go to the Ombudsman. As such, there is no way that they represent a practical alternative solution to urgent problems, such as a homeless person needing accommodation or a tenant requiring urgent repair works.
There are further problems, such as how to enforce a decision made internally by a council following a complaint. It may well be that it will be ignored, and the only solution will be another complaint. Another major problem is that the Ombudsman and therefore internal complaints officers only recommend much lower compensation than the courts and do not provide for the recovery of legal costs. This means that if someone has a complex problem which they need help with from a lawyer with they won’t be able to claim their legal fees back after a successful complaint which they probably would be able to do if they issued legal proceedings.
This case does open the door to the possibility of Defendant public bodies being able to persuade a Court stay proceedings, refer cases to ADR, and award costs against parties who have unreasonably refused to agree to ADR. I predict that until public bodies crank up their complaints procedures so that they provide speedy and effective grievance redress, this will not happen very much. Then again, it would be foolish to ignore the possibility and not be prepared for an aggressive opponent applying for a stay and costs
The Bar Council, which intervened in the case, set out a list of eleven factors which it said should be considered by the courts when deciding whether to exercise their discretion as to whether to stay proceedings and make orders for costs against those who had issued legal proceedings rather than complaining. These were:-
- The form of ADR being considered
- Whether the parties were legally advised or represented
- Whether ADR was likely to be effective or appropriate without such advice or representation
- Whether it was made clear to the parties that, if they did not settle, they were free to pursue their claim or defence,
- The urgency of the case and the reasonableness of the delay caused by ADR,
- Whether that delay would vitiate the claim oe give rise to or exacerbate any limitation issue
- The costs of ADR, both in absolute terms and relative to the parties' resources and the value of the claim
- Whether there was any realistic prospect of the claim being resolved through ADR
- Whether there was a significant imbalance in the parties' levels of resource, bargaining power, or sophistication,
- The reasons given by a party for not wishing to mediate: for example, if there had already been a recent unsuccessful attempt at ADR, and
- The reasonableness and proportionality of the sanction in the event that a party declines ADR in the face of an order of the Court.
I suggest that before proceedings are issued, potential claimants take the following steps:
- Carry out an assessment as to whether it might be successfully argued by an opponent that the case you are dealing with would be dealt with through ADR.
- When writing a letter before action to a public body, invite them to deal with the matter by way of an internal complaint. This might require the potential claimant to allow 8 weeks for the council to respond rather than the 2 weeks which is often allowed with a letter before action. Actually, with the Pre-Action Protocol for Housing Conditions, there is generally time for this, as you have to allow a month before instructing a surveyor and a further 14 days from when the surveyor’s report is sent to the landlord. The surveyor will usually take two or three weeks to inspect and then produce a report so you are looking at three months anyway.Where urgent action on the part of the council is required, such as carrying out repair works, and the tenant cannot be expected to wait this long, the landlord can be invited to expedite their complaints procedure and deal with the complaint in say 7 days, with a warning that proceedings will be issued if this cannot be done.It will rarely be appropriate to delay judicial Review proceedings in this way as they are supposed to be issued as soon as possible, and in any event, not later than three weeks after the decision complained of. Nevertheless, a Judicial Review Pre Action Protocol letter might still invite the proposed Defendant to deal with the matter by way of an expedited complaint.
- Include a section in a Particulars of Claim explaining why ADR is not considered appropriate and citing the Bar Council criteria as justification
Once these steps have been taken, I think that claimants will be able to proceed through the courts without fear of having the proceedings derailed by an application for a stay and referral to ADR and either being denied the costs of the claim or having the opponent's costs awarded against them.