'Law of Apologies': a tool in ADR?


It appears that this is the question that the Ministry of Justice is asking in its latest consultation on the so called law of apologies, in civil proceedings in England and Wales. 

More often than not, when advising clients on the benefits of settling a dispute, the starting point is the costs of pursuing or defending the claim and the potential recovery of monies. 

However, it is not just the net gain or loss that clients have in mind but also the more intangible reasons for engaging with litigation. 

For instance, reputation management. It can be seen as costly to a business if it fails to make an example of a party who has somehow wronged it, acting against perceived customs or the spirit of good faith in commerce. 

And anyone who has participated in litigation, and specifically commercial litigation, will be no stranger to the weight which the process brings to business. In addition to the costs of the legal services, the opportunity cost is the time that could have been spent growing the business, instead of litigating on its behalf. 

It is in such cases where an apology can potentially sweep in to settle the dispute and calm stormy waters. 

The fear with issuing apologies is that it can be construed and used against you as an admission of liability in civil proceedings. This concern can be addressed through legislation and that is what the Ministry of Justice is currently inviting views on. An apology is seen as a potential tool to settle disputes. An apology can be partial, in that it doesn't accept responsibility for the circumstances, but simply expresses regret. An apology can also and of course be full, accepting  responsibility. 

The law of apologies has not received much attention in England and Wales to date. Currently, Section 2 of the Compensation Act states that ‘an apology, an offer of treatment or other redress, shall not of itself amount to an admission of negligence or breach of statutory duty’. Unfortunately, Section 2 has not had very much impact in reality. It's protection is seen as being limited, leaving parties exposed to liability in civil proceedings.

So the Ministry of Justice has sought to draw examples from other jurisdictions, as near as Scotland and as far as Hong Kong, where apologies law is more comprehensively designed. In Hong Kong, for example, the legislation goes so far as to allow an apology to be inadmissible as evidence, even if it includes a clear admission of fault. 

One possibility might be to consider creative ways to employ the law of apologies within mechanisms that we already have in place for alternative dispute resolution, such as privileged communication and mediation. However, confidentiality is the touchstone of these mechanisms and a big incentive in favour of accepting an apology is that it is both public and exemplary. 

From a practitioner's perspective, the development of apologies law is a worthwhile endeavour, especially in low to medium value disputes. Even proceedings that seem cost-efficient in the early days can tip the scale as the case progress and all too often, parties can find themselves in a position where the costs of continuing the litigation are entirely disproportionate to what's at stake. 

So ‘apologies law' can help avoid all of this, even though sorry still seems to be  the hardest word.  

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