Monday 31 August 2009

Darren Olivier

ADR on its way - the Brownlee decision

Thanks to ADR specialist John Brand for highlighting an important judgment (click here) in a divorce case handed down in Johannesburg last week extolling the virtues of mediation. The case is likely to set an important precedent against attorneys attempting to claim attorney and client costs where mediation is not suggested at an early stage.

(Right: One suspects that The Browning, by its very nature, would not have approved of Brownlee)

"This is but an instance of what mediation might have achieved. In fact the benefits go well beyond it. In the process of mediation, the parties would have had ample scope for an informed but informal debate on the levels of their estates, the amount of their incomes and the extent of their living costs. Nudged by a facilitative intermediary, I have little doubt that they would have been able to solve most of the monetary disputes that stood between them. The saving in time and legal costs would have been significant and, once a few breakthroughs had been made, I have every reason to believe that an overall solution would have been reached. Everyone would, in the process, have been spared the burden of two wasted days trying to settle in judge’s chambers and four further days in which the minutiae of assets and liabilities and income and expenses were interrogated.

In short, mediation was the better alternative and it should have been tried. On the facts before me it is impossible to know whether the parties knew about the benefits of mediation, but I can see no reason why they would have turned their backs on the process, especially if they had been counselled on the matter by the attorneys. What is clear, however, is that the attorneys did not provide this counsel; in fact, in the course of the pre-trial conference they positively rejected the use of the process. For this they are to blame and they must, I believe, shoulder the responsibility that comes from failing properly to serve the interests of their clients.

In the course of the hearing, I asked counsel whether I had the power to cap the fees that the lawyers might derive from the case, and it was agreed that this is indeed my right. I can find nothing in the conduct of counsel to warrant such a move – they take their instructions from the attorney - but I am persuaded that the failure of the attorneys to send this matter to mediation at an early stage should be visited by the court’s displeasure. On this basis, I propose to limit the fees they can recover from their clients to the costs they can tax on a party and party scale. The client retains the right to pay more, but the attorney should not ask for this unless the client has obtained the advice of an independent practitioner."

This is very reminiscent of English judgments post the Woolf reforms and example of a growing trend for parties to show efforts to resolve disputes without recourse to Court. As an aside, the opposition period in trade mark proceedings is, in many ways, an ADR forum where issues are often resolved using cost effective Registry procedures and settlement agreements. In RSA the overburdened Courts and Registry are likely to make ADR more popular and I was reminded of this on Friday when consulting at a client who chooses to resolve a number of their IP disputes with a major competitor by each of them making representations to an agreed senior counsel, and then agreeing between them to adopt the decision. "It's quicker and cheaper" he says, and the client is assured of a competent decision maker. Although this client acknowledges that their method of dispute resolution, like mediation, is not always appropriate for resolving IPR disputes, one senses that Brownlee is another baby step toward more progressive ways of dealing with contentious matters.

Darren Olivier

Darren Olivier

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