Coronavirus Dispute Management FAQs
Last updated, 3rd July 2020
Coronavirus is impacting on the working practices of the judicial system massively. The situation in the courts has changed rapidly over the past few months and it is an uncertain time for both individuals and businesses who are already involved in, or might become involved in, litigation. Here we seek to address some of the issues that we are regularly being asked by clients right now. If you would like to ask about something not covered below, please do get in touch with us.
In light of Coronavirus, is arbitration now preferable over litigation as a method of dispute resolution?
Arbitration is more flexible than court litigation: as it is a creature of contract, the parties can, provided that they (and the arbitrator(s)) agree, to a large part determine their procedure for the resolution of the dispute. The international arbitration community has, for some time, made use of technology to deal with matters remotely: it is not, for instance, uncommon for procedural hearings to be dealt with by videoconference, given the time and cost that would be required to gather everyone into one physical place. Parties are also usually able agree that the arbitrator should determine their dispute or, more commonly, a specific issue or application, on the papers, without the need for a hearing. This, of course, all seems very suited to the challenges being experienced as a result of the Coronavirus outbreak, particularly where key participants are based in different countries and given the widespread travel restrictions currently in force.
Whilst most arbitrations arise in respect of disputes under contracts where an arbitration agreement was included in the contract itself, it is possible to agree to use arbitration “after the event” to resolve a dispute that has occurred, even though the contract does not provide for arbitration. However, this requires the agreement of both parties, not only to the use of arbitration, but also as to the procedure and rules to be adopted in that arbitration. It is often difficult to reach such agreement after a dispute has arisen, although parties may be willing to be more flexible and creative given current restrictions.
However, you should also bear in mind the disadvantages to arbitration: because it is a creature of contract it does rely on the cooperation of the parties, certainly where an expeditious outcome is desired. Arbitrators have, in practice, a limited toolkit of sanctions to apply to a deliberately delaying or defaulting party and are often wary of taking any step which might provide a defaulting party with the potential to challenge enforcement of an award on the basis that it has not been given a fair (and indeed often every) opportunity to make its case. Summary judgment is not available and rapid interim relief can be more difficult to obtain, even with the various emergency arbitrator provisions now available under most institutional rules.
Ultimately, if your counter-party does not want a hearing to go ahead by video conference, or otherwise deal with the dispute expeditiously, then it is unlikely, in practice that this will happen but, where parties share a genuine desire to progress the dispute through to a final outcome, arbitration provides a flexible format for doing so.
How are the courts operating in light of the Coronavirus outbreak?
With the government lockdown, it has been a challenging time for the judicial system, but the message has largely been that access to justice should remain and courts should continue to operate, albeit in a different way.
There is no set rule being applied across all of the civil courts in England and Wales. However, what can be said is that the courts are largely avoiding physical hearings and arranging remote hearings wherever possible. A number of courts have issued protocols as to how to hear cases remotely using telephone or video technology, and some courts (such as the High Court and the Court of Appeal) are only covering urgent work and are adjourning hearings. Where physical attendance is necessary, the courts are implementing social distancing measures.
Many court service staff are working remotely and, accordingly, you should anticipate that there will be some delays, particularly with non-urgent matters and you should ensure that you are allowing ample time.
At Freeths we have put in place the technology required to continue with hearings, as well as mediations and settlement hearings, and we will be happy to discuss these with you.
The limitation period for my claim is about to expire. What can I do?
It is important to ensure that you comply with the time frames for bringing a claim since a failure to do so can provide a complete defence to your claim. No changes have been made to the Limitation Act 1980 and its strict provisions remain in force.
There are risks to leaving the filing and issue of a claim form until shortly before the limitation period is due to expire, and these risks are clearly greater still given the potential for practical issues connected to Coronavirus. To minimise the possibility of your claim becoming time-barred, if your limitation period is due to expire shortly, we can explore with you:
- whether it is possible to enter into a standstill agreement with the other party/parties involved, or
- whether issuing protective proceedings might be prudent
A standstill agreement is designed to either suspend the running of the limitation period, or to extend the limitation period.
In the event that it is not possible to enter into a standstill agreement, it may sometimes be sensible and/or necessary to issue protective proceedings. However, having issued a claim, time will begin to run for service of the claim and you will be expected to pursue the proceedings promptly and effectively.
Can I still issue my claim?
Yes, at present, the court service is still issuing civil proceedings, both in the High Court and through the County Court network.
Different procedures apply in different courts: for instance the Commercial Court was already using an electronic process for the filing of documents, which has been largely unaffected by current events, whereas a number of the County Courts, where we would normally issue urgent claims or applications in person, are now operating their usual counter service by email only. It is, therefore, advisable to check with the particular court.
If your claim is, or may, be close to the limitation period (the time within which you must commence proceedings, by issuing a claim at court), then it would be prudent to send your proceedings to the court for issue as soon as possible and factor in that the Court Service may require extra time to deal with the paperwork. We have found Court Service personnel to be receptive to requests for proceedings or applications to be issued urgently where there is good cause for doing so, but there is, of course, no guarantee of this. We would advise that extra time is allowed and that contact is made with the court involved at an advance stage regarding any specific assistance that may be required of them during this challenging time.
Will my hearing/trial go ahead?
Courts and tribunals are continuing to operate despite the Coronavirus outbreak, albeit with an increased emphasis on remote hearings and some adjournments for what are considered non-urgent matters. At Freeths we have put in place the technology required to continue with hearings, as well as mediations and settlement meetings, remotely.
However, there are a few things that you still need to consider in order to ensure that your hearing/trial is carried out properly and that justice can be done, for example:
- Can the hearing proceed without whoever is unable to attend?
- If a witness is unable to attend, are they a key witness?
- Would it be satisfactory for a witness to give evidence via phone or video link?
If it is not possible to proceed with the hearing or trial, it may be possible to make an application for an adjournment for Coronavirus-related reasons and, where specific medical issues apply to key witnesses, experts or members of the team involved, medical evidence should be included with the application. However, you should be aware that the decision to adjourn remains at the discretion of the judge.
You should also distinguish between an inability to attend court and an unwillingness to do so. An inability to attend court is likely to be viewed as far more important than a mere unwillingness to do so. Again, whatever the circumstances, the court will require evidence and justifiable evidence.
I need to provide a witness statement but I am self-isolating. What can I do?
Restrictions on meeting in person will provide challenges in relation to managing evidence generally and we will discuss with you in particular:
- Using technology to facilitate taking your witnesses statement. At the very least, we will likely take your witness statement proof over the telephone and will explain this in the statement in order to seek to remove any adverse inferences as to the value of the statement.
- Allowing more time for your witness statements to be signed, as this may need to be done via post or by courier. Alternatively, we use a third party platform known as Docusign so that we can obtain your electronic signature.
When it comes to the hearing/trial, if necessary, we can make alternative arrangements if you are unable attend court—see above.
What about my mediation or settlement meeting?
We have already conducted remote mediation, using a virtual platform, for clients since the COVID-19 travel restrictions commenced, securing an on the day commercial settlement for our client – you can read more about this here.
I don’t think that I can comply with a court direction as I am self-isolating due to Coronavirus. What can I do?
The overriding approach of the courts is that you should comply with the court timetable and, if at all possible, you should do whatever you can to meet any deadlines.
However, if events overtake you, you may be able to ask the court for an extension of time for complying with a direction. The first “Coronavirus direction” displaced the normal rule that the parties can agree extensions of time of up to 28 days and instead allowed the parties to agree an extension of time for up to 56 days. However, this does not apply to the period for filing and serving defences.
Any request for an extension beyond 56 days will require a formal application to the court. When making such an application, you should explain how the pandemic has impacted upon your ability to comply with the direction(s) and supply any relevant medical evidence. However, you should be aware that the decision remains at the discretion of the judge.
I need to sign a document but I am self-isolating. What can I do?
The Coronavirus outbreak has undoubtedly provided additional challenges in terms of obtaining physical signatures.
Where the court rules require a document to be signed, this is satisfied if the signature is printed by computer or other mechanical means. This means that, in most cases, we are able to avoid having to post documents or even having to be physically present when someone signs a document.
At Freeths, we use a third party platform known as Docusign, which allows documents, such as court forms, contracts and settlement agreements, to be signed electronically by anyone with access to an e-mail account and a web browser.
For further information on Docusign, and signing documents generally, please see our ‘Signing commercial contracts FAQs’ here.
If you would like to talk through the consequences for your business, please email us and one of our team will get in touch.
The content of this page is a summary of the law in force at the date of publication and is not exhaustive, nor does it contain definitive advice. Specialist legal advice should be sought in relation to any queries that may arise.
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