Case Law
< back to case lawBurchell NF –v- Mr & Mrs Bullard [2005] EWCA Civ 358
Burchell was a builder who agreed to construct an extension to the Bullards' home. The Bullards thought his work unsatisfactory, and refused to pay his bill of £18,318. They counterclaimed £100,815 and further damages. In particular, they said that Burchell's work on their roof was unsatisfactory, and that it would cost £23,646 to dismantle and rebuild it.
After a bitterly fought trial, Burchall was awarded £18,327 and the Bullards £14,373, a net amount after VAT and interest of only £5,025. The Court of Appeal was asked to consider costs, which had risen to some £185,000.
The court noted that Burchell's solicitors had suggested mediation at an early stage, but the Bullards' response was that "the matters complained of are technically complex and as such mediation is not an appropriate route to settle matters."
The court was not persuaded. Ward LJ said that a small building dispute is par excellence the kind of dispute which lends itself to ADR; that the merits of the case favoured mediation, and that the Bullards behaved unreasonably in believing, if they did, that their case was so watertight that they need not engage in attempts to settle. He said that the stated reason that the matter was technically too complex to be mediated was "plain nonsense", and that the cost of ADR would have been a drop in the ocean compared with the fortune spent on this case. He said the case was indeed suitable for mediation, and that the Bullards could not rely on their own obstinacy when saying that mediation had no reasonable prospect of success.
Ward LJ said that the Bullards would not suffer costs sanctions from their refusal to mediate, but only because they refused the offer on the advice of their surveyor, not their solicitor. Also he noted that this occurred in 2001, long before the guidance offered by the judgment in Halsey. But he went on to say:
"The profession must, however, take no comfort from this conclusion. Halsey has made plain not only the high rate of a successful outcome being achieved by mediation but also its established importance as a track to a just result running parallel with that of the court system. Both have a proper part to play in the administration of justice. The court has given its stamp of approval to mediation and it is now the legal profession which must become fully aware of that and acknowledge its value. The profession can no longer with impunity shrug aside reasonable requests to mediate. The parties cannot ignore a proper request to mediate simply because it was made before the claim was issued. With court fees escalating it may be folly to do so. I draw attention, moreover, to the Pre-Action Protocol for Construction and Engineering Disputes - which I doubt was at the forefront of the parties' minds – which expressly requires the parties to consider whether some form of alternative dispute resolution procedure would be more suitable than litigation. The Bullards have escaped the imposition of a costs sanction in this case but defendants in a like position in the future can expect little sympathy if they blithely battle on regardless of the alternatives."