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Reimagining Dispute Resolution Under Cyprus’s CPR 2023: The Emerging Role of Mediation

posted 3 weeks ago

The 2023 Civil Procedure Rules (CPR) represent the most significant transformation of Cyprus’s civil justice framework since independence. Inspired by modern litigation principles and decades of common law evolution, the new rules aim to improve case management, encourage early resolution, and reduce delays and costs. Among their most profound shifts is the elevation of mediation—not just as a procedural formality, but as a structured, judicially endorsed alternative to litigation.

This article explores how mediation is positioned within the CPR framework, especially under the “overriding objective,” and how pre-action protocols, small claims, and judicial cost sanctions reshape the strategic landscape for litigants. Drawing from English precedent and local procedural reform, it assesses whether Cyprus is transitioning towards a truly mediation-forward model, or whether cultural and practical barriers still stand in the way.

1. A New Civil Justice Era: What the 2023 CPR Really Changed

The focus here pertains to the implications of the new Civil Procedure Rules (CPR) of 2023 on the practice of mediation. The CPR are anticipated to profoundly impact the operational aspects of the District Courts of Cyprus, primarily by introducing the “overriding objective,” which seeks to ensure the equitable and cost-effective resolution of cases. Ι will underscore the mechanisms facilitating dispute resolution prior to formal and traditional hearings, with a particular emphasis on the utilization of alternative dispute resolution techniques, notably mediation. The principal objective of this part is to critically evaluate the extent to which these rules foster and incentivize the resolution of disputes without recourse to formal hearings, and whether mediation is positioned as the primary alternative for dispute resolution. Lastly, it aims to examine the practical implementation and enforcement of the overriding objective.

The Old Cypriot Procedural Rules were established based on the Rules of England and Wales that were in effect when Cyprus became independent. Since 1958, the rules have undergone only minimal revisions, except for the amendments made to Orders 25 and 30 in 2016. The rules were identified as a significant impediment to efficiency and a major cause of delay in the Cypriot judicial system.[1],[2] Nevertheless, the need for radical reform of the Civil Procedure Rules was a very mature finding, and the Pikis Report identified a pressing need for radical reform of the Civil Procedure Rules as early as 1989. The report was not implemented, and the piecemeal reforms that followed had little impact.[3]

2. Mediation & the “Overriding Objective”: Substance over Formality

It is evident from the outset that the primary objective of the legal reform in question remains intact, as enshrined in Rule 1.2(1); although, the degree to which this objective has been achieved requires further examination over time. In particular, Rule 1.2(1) stipulates that “These rules are a procedural code with the overriding objective of enabling the court to deal with cases justly and at proportionate cost.” For sure, Rule 1.2(1) is not just a mere platitude. The interpretive articles of any legislative framework have increased significance and play a crucial role in understanding and applying each law, and Rule 1.2(1) falls under the section titled “overriding objective.

Very relevant is the case of Lombard (1999)[4], where the argument was that the formal request of the Claimant did not meet the criteria established under the previous CPR of England. The court rejected this application, stating that while the wording in the Civil Procedure Rules 1998 echoed the previous principle, the “overriding objective” outlined in the new rules meant that specific principles could not be applied in the same way. The court emphasized that the new rules interpretive provisions must guide the interpretation of the law, preventing the old case law from dictating the application of the new legislation.

In the context of understanding the CPR’s interpretive provisions, particularly Rule 1.5(2) mandates that the court must actively manage cases in order to further these overriding objectives. This active case management encompasses various essential components, such as encouraging the parties to cooperate with each other in the conduct of the proceedings, and identifying the issues at an early stage. Preliminary examination of issues is strongly encouraged. For example, as emphasized by J. David Steel in McLoughlin (2001),[5] where the proposed appeal was allowed due to the parties’ failure to properly determine preliminary issues and to establish the factual premise.

It is noteworthy that these interpretive provisions extend a warm welcome to mediation, which can be immensely helpful in resolving disputes in a timely and cost-effective manner. It seems that mediation anymore is fully compatible with new CPR and the expectations of the judge from the litigants.

3. Pre-Action Protocols: Bringing Settlement to the Forefront

The old Cyprus Rules of Civil Procedure did not provide any rule or recommendation for initiating a lawsuit or suggest when it is appropriate to file a writ of summons; nor was also no regulatory or theoretical framework regarding what should precede an attorney’s application to the court. For sure, there are some exceptions in specialized laws such as Banking Law and Auctioned Real Estate process, like where specific notifications and letters are required before the bank can proceed with a mortgage claim. However, in all other cases, lawyers usually relied on the Limitation Rules and a strategic approach to handle each particular case. Drafting in a general or conciliatory style was preferred among Cypriot lawyers, so there was no substantial reason for a lawyer to insist on crystallizing the case and limiting the issues at stake while finalizing the presented claims.

According to new CPR, the procedures to be followed prior to the filing of any claim, application or application form start with pre-action Protocols. If the parties do not adhere to the rules without any justification, the Court may impose sanctions on the non-complying party.

For claims that involve specified amounts of money, such as invoices, loans, liquidated amounts, or rent, Protocol I applies. Under this protocol, the Claimant must send a letter of claim to the proposed Defendant. The letter of claim must follow specific forms that have been introduced by the Rules to be used in all applicable cases. However, this requirement letter may be modified to fit each individual case.

Protocol II pertains to road traffic accidents and personal injury claims. This protocol applies mostly to claims related to traffic accidents, including property damage and personal injury cases. All personal injury cases must follow the protocol guidelines, and in cases arising from road traffic accidents where there are no personal injuries involved, it should be followed wherever possible.

Protocol III deals with pre-action conduct in cases the aforementioned Protocols do not cover. This protocol concerns the procedure that the parties involved must follow before the commencement of legal proceedings. However, CPR Rule 3.13, which concerns Protocol III, provides further guidance regarding the exchange of relevant information and documents related to the claim. The parties involved are required to act reasonably and avoid litigation. They must follow a fair process aimed at preventing litigation actions. In cases where an expert witness opinion is necessary to settle a claim, the parties should agree on appointing a single expert witness whenever possible.

In any case, it should be noted that there is the possibility as well as the intention to add additional Protocols.

According to CPR Rule 3.9, pre-action protocols are designed to encourage parties to engage in substantive negotiations as soon as a dispute is recognized. The goal is to help parties obtain all the relevant information they need to enter into negotiations for an out-of-court settlement. If a settlement proposal is submitted, it could have cost consequences. The aim is to resolve disputes without the assistance of the court and to effectively manage cases where litigation cannot be avoided. An intriguing perspective was presented in the Daejan case,[6] which dealt with comparable but more sophisticated and developed British Pre-Action Protocols. It was stated that “[…] the object of the protocol […] is to get people to put their cards on the table and to honestly and rationally discuss matters.

Through these protocols, described as “… a significant part of the architecture of judicial procedures,” cooperation and dispute resolution between parties are promoted at an early stage through the exchange of information, while mediation is encouraged. In cases where the dispute is brought to court, the protocols aim for smooth judicial proceedings with limited contentious issues. The court may consider compliance or non-compliance with the pre-trial protocol when issuing case management directions and when issuing orders regarding costs, thereby creating a strong incentive for parties to engage in pre-trial communications.

Rules 3.10(1) and 3.10(2) clearly state that parties should obey pre-action protocols and conduct; otherwise, the Court will consider such negligence and impose penalties. For example according to 3.10(4), when non-compliance has led to the start of judicial proceedings, the court may issue such an order as it deems fair to avoid placing the innocent party in a more unfavorable position, including an order requiring the party in violation to pay all or part of the costs.

In the demand letter and response, the claimant and the defendant, respectively, must state whether they wish to refer the matter to mediation or another Alternative Dispute Resolution (ADR) method.

4. How the CPR Reshape Small Claims

A new innovation of the new CPR is that a claim can be classified as Small or Ordinary (Standard).

The criterion in question is whether the Claimant is claiming a total amount less than €10,000 or seeking compensation of less than €10,000, or if the Court believes that the Claimant believes it is unlikely to secure an amount greater than €10,000.

Firstly, the triple disjunctive criterion obviously aims to allow the Court to intervene when the Claimant makes clearly excessive claims for the circumstances of the case. While Rule 28.3 provides additional powers to the Judge to upgrade or downgrade the classification of the Court Case always considering the overriding objective of the CPR. This means that if the Claimant advances remedies unjustified by the circumstances, or if the deviation from the small claims limit is tiny and the disputed facts are not serious or complex enough to justify a full-scale trial, then the Court and the Judge have substantial powers to insist on a more minimal court procedure.

It is the author’s opinion that these provisions (such as those for pre-trial protocols) also promote the concept of Mediation. On the one hand, there are all these very fundamental rights, such as the Right to Access Justice, but also other collateral rights, such as freedom of contracts; on the other hand, emotionally charged claimants seek exhaustive legal avenues to their problems. Therefore, if the Court, in safeguarding itself and the Justice system, considers legally simple cases or those without legal interest for simplified examination, then Mediation becomes more attractive due to its flexibility and ability for interpersonal deepening, gaining additional value.

Thus, cases related to Small Claims have simplified procedures in relation to (i) mechanisms for providing additional information and clarifications (Part 19), (ii) interim remedies (Part 25), (iii) Disclosure and Inspection of Documents (Part 31), (iv) Evidence (Part 32), and (v) Hearing (Part 37). Indicatively, Rule 29.9 even refers to the possibility of the Court dealing with the claims without a hearing.

5. Semantic Confusion: When Legal Terms Undermine Legal Certainty

Although the 2023 Civil Procedure Rules introduced long-overdue procedural reforms, certain terminological choices—particularly regarding mediation—have generated conceptual ambiguities. These inconsistencies, when compared to the terminology used in the National Law for Mediation (NLM), risk weakening the legal clarity and internal coherence the reform sought to achieve. The NLM, formally titled The Certain Aspects of Mediation in Civil Disputes Act of 2012 (Law 159(I)/2012), was enacted to align domestic mediation practices with the EU Directive on Mediation.[7] It governs both domestic and cross-border civil disputes, including commercial matters, but excludes categories such as disputes where the parties lack the legal freedom to settle and certain labour disputes falling outside the Directive’s scope.

An issue observed concerns the inadequacy of certain terms both in the text of the National Law for Mediation and in the CPR. For example, the CPR use the term “Mediation Αrrangement“,[8] which may have been chosen to include other agreements, such as oral ones; however, this conflicts with the different term chosen for the law, “Compromise Agreement“.[9] Another term that potentially raises interest is that the CPR also use the term “Mediation Administrator“,[10] which differs from the dictionary word “Mediator“, the term chosen in the text of the National Law for Mediation. For instance, Rule 45.65(2)(a) states that “the mediator or mediation administrator […]“, implying that the mediator and the mediation administrator are two different terms. Perhaps the term “Mediation Administrator” refers to the various private mediation institutes in the country; however, this interpretation is also problematic. Firstly, the theory of mediation does not prescribe for the existence of mediation institutes or forums although there are some, and theoretically, nothing prevents a freelance accredited mediator of common acceptance by the parties from managing an ad hoc mediation process. Similarly, neither the text of the CPR nor the National Law for Mediation or any other law defines the existence of mediation institutes in any way, while, on the contrary, they stipulate that mediation can take place anywhere.

6. From Settlement to Judgment: Making MSAs Enforceable under the CPR

Mediation Settlement Agreements (MSAs) are the written outcomes of successful mediation procedures, in which parties voluntarily agree to resolve their dispute. While these agreements are typically based on consent and private negotiation, their legal effect becomes critically important once one party seeks to enforce the terms. In most jurisdictions, including Cyprus, MSAs are generally treated as contracts and interpreted through the lens of contract law. However, unlike ordinary contracts, they are often afforded a heightened status—some scholars even refer to them as “super contracts.”[11] This is due to their direct connection with court-sanctioned processes, strict confidentiality norms, and limited grounds for contesting their validity. The 2023 Civil Procedure Rules (CPR) introduced a clear procedural framework to convert MSAs into enforceable orders, equating them with judicial decisions. This section unpacks that framework and the implications of submitting MSAs for enforcement under Part 8 or Part 23 of the CPR.

From a technocratic angle, we should pay tribute to the Cyprus legal system since it provides that the enforceability of the settlement agreement after mediation can be equated to a court judgment. In general, CPR provides two frameworks for initiating a mediation process. If a court procedure is already in progress, an interim application under Part 23 of CPR is appropriate.[12] However, if the parties start and successfully conclude a mediation without a court procedure being initiated, then they can use the procedure outlined in Part 8 to secure the execution and enforceability of the mediation settlement agreement.[13] This involves skipping the steps of Rules 8.3 to 8.8 and seeking a court order that will reiterate the terms of the settlement.[14]

Once all parties give their consent[15] or if the settlement agreement contains a relevant clause,[16] an Application may be filed with the Court, and the Court may (or may not)[17] declare the whole or part of the agreement as enforceable with the same effect[18] and a court decision with the same content as the agreement may be issued. In fact, the procedural procedure is more favourable to the procedure followed for execution actions or to secure the enforceability of prior judgment; since, as we already discussed, CPR Rules 8.3 to 8.8 should be skipped.

The registration of an agreement resulting from mediation is significant since the agreement escapes the traditional and everyday framework of Contract Law and is equated with a court order, which is even directly enforceable once the particular simplified steps provided for in the new CPR are followed.

When the circumstances and the complexity of the case justify it, there is also the option for Tomlin Order. A Tomlin order is a special type of consent order where legal proceedings are paused based on agreed terms. If these terms are not met, the stay can be lifted, and the order allows parties to enforce the agreed terms without starting new legal actions. Unlike typical consent orders, a Tomlin order is a binding contract, meaning the court can only re-open the dispute between the parties where it could intervene with any other contract.[19]

7. Confidentiality, Disclosure & Mediation Evidence in the Courtroom

As per Rule 45.62, the term “mediation evidence” refers to evidence that arises during or in connection with a mediation process. The relevant articles, ranging from 45.65 to 45.67 of the CPR, represent an attempt to harmonise the technical language of the procedural rules with the principles of mediation and the NLM; particularly with respect to the confidentiality of mediation and in regard to the high barriers that one must overcome to convince a judge to order the disclosure and inspection of evidence arising from the mediation process. These provisions align fully with the NLM, reflecting the core principles of mediation by maintaining the stringent requirements for preserving the confidentiality of mediation proceedings.

The core provisions we meet in Rules 45.65 to 45.67. In general, they cover scenarios both within ongoing civil proceedings and instances where mediation evidence is sought through court without an existing related judicial process.[20] A notable aspect of these articles is that when such a request is made, the mediator becomes a party to the judicial proceedings and they are served with the application documents and granting them the status of Respondent.[21] While not explicitly stated, this implies that the mediator could theoretically file an objection to the applicant’s request. The cornerstone of these provisions is the requirement for applications seeking disclosure of mediation evidence to be accompanied by an appropriate affidavit from a competent person. This affidavit must attest that the necessary criteria are met, which mirror those in the NLM.[22] Although, these provisions make a distinction for cases classified as Small Claims.[23] In these instances, the formal application process is bypassed. Instead, the applicant verbally informs the judge of their desire to introduce mediation evidence.[24] The judge then has the discretion to provide appropriate directions on a case-by-case basis

Mediation processes are inherently confidential. In the very beginning, we discuss the importance of mediation, and later in this section, the relevant provision of the NLM is explained. However, when it is seeking the enforceability and the execution of a mediation settlement agreement through the court powers, it is legitimately appropriate and reasonable to be included a few derogations to the fundamental principle of confidentiality; and carefully scrutinise the balance between the principle of confidentiality and the legitimate interest in ensuring the enforceability of mediated agreements.

The abovementioned criteria for the disclosure of mediation evidence are met when it is necessary to (i) implement or enforce the mediation settlement agreement,[25] or (ii) when there are overriding public policy considerations as defined in article 7(1)(a) of the EUM.[26],[27] Last but not least, the party’s request that mediation evidences shall be revealed is satisfied also (iii) when all parties to the mediation agree to the disclosure or inspection.[28]

8. Conclusion: A Strategic Tool for a Smarter Litigation System

It is imperative, especially for lawyers, to internalize that an overarching objective guides the current civil procedural framework. This objective is not intended to position mediation as a preliminary obligatory step before court proceedings. Instead, it necessitates that legal practitioners skillfully assess and determine the appropriateness of mediation on a case-by-case basis. This may involve implementing a pre-action protocol, or, at the very least, using simple communications to narrow down the issues in dispute and exchange preliminary views regarding potential remedies amounts.

The new Civil Procedure Rules (CPR) of Cyprus in 2023 introduce innovative approaches that significantly enhance the position of mediation within the legal system. The pre-trial protocols encourage and guide parties to consider mediation as a favorable alternative resolution. Similar encouragement is seen with the simplified rules for Small Claims cases under €10,000, which not only expedite the judicial process but also make mediation even more appealing for these simpler cases. Concurrently, the strict rules regarding the confidentiality of mediation, as set out in Rules 45.65 to 45.67, ensure the integrity of the process while allowing for the disclosure of information under specific conditions. These changes, combined with D. Q. Anderson’s historical findings on the lack of significant differences in success rates between mandatory and voluntary mediation, suggest that the integration of mediation into the legal system can be effective without violating the principles of justice or the free will of the parties.

Mediation emerges as a structured and effective tool that can significantly alleviate the courts’ caseload by resolving disputes that do not necessarily require judicial final and formal hearings. Far from being a trend, mediation offers numerous advantages and safeguards, such as preserving confidentiality and providing a neutral third party to mitigate the pressures exerted on lawyers by their clients. By fostering a more amicable and efficient resolution process, mediation serves as a valuable mechanism within the broader legal landscape, aligning with the overriding objective of delivering justice fairly, swiftly, and cost-effectively.

[1]Introduction for CPR Guiding Drafts’ (Supreme Court of the Republic 2019), p. 2.

[2] Among other things, in the ‘Council Recommendation of 12 July 2016 on the 2016 National Reform Programme of Cyprus and delivering a Council opinion on the 2016 Stability Programme of Cyprus’(2016/C 299/07),  it was noted that ‘[i]nefficient court procedures and limited capacity lead to significant delays in processing court cases […]. In the absence of a reform of the civil procedure law, the processing and enforcement of court decisions and the reduction of backlogs remain slow,’ and the recommendation was given to ‘[i]ncrease the efficiency and capacity of the court system and reform its civil procedure law.’

[3] Speech of Persephony Panayi, ‘Opening Speech of the President of the Supreme Court at Official handover ceremony of the New Rules of Civil Procedure to the Supreme Court’ (26 November 2020) <http://www.supremecourt.gov.cy/Judicial/sc.nsf/All/2F88169B0310EED5C225863000420C57?OpenDocument> accessed 5 May 2024.

[4] Lombard Natwest Factors Ltd v Arbis [1999] 10 WLUK 940

[5] McLoughlin v Grovers [2001] EWCA Civ 1743

[6] Daejan Investment Ltd v. Park West Club Ltd [2003] EWHC 2872 (TCC)

[7] Directive 2008/52/EC

[8] Original Greek Word: Διακανονισμός Διαμεσολάβησης.

[9] Original Greek Word: Συμφωνία Συμβιβασμού.

[10] Original Greek Word: Διαχειριστής Διαμεσολάβησης.

[11] Edna Sussman and Conna Weiner, ‘Striving for the Bullet-Proof Mediation Settlement Agreement’ [2015] 8 New York State Bar Association 22, p. 22.

[12] CPR Rule 45.63(1)(a)

[13] CPR Rule 45.63(1)(b)

[14] CPR Rule 45.63(2)

[15] CPR Rule 45.63(5)

[16] CPR Rule 45.63(9)(a)

[17] The court may rejects the application if the content of the settlement agreement is contrary to the law, unenforceable, or if the dispute could not be resolved through mediation. Such a decision is subject to appeal under Rule 45.63(11).

[18] CPR Rule 45.63(7)

[19] Robert Turner, Jonathan Winegarten and Michael Kershaw (eds), ‘Atkin’s Court Forms’ (LexisNexis 2024), p 133.

[20] CPR Rule 45.65(1)

[21] CPR Rule 45.65(2)

[22] CPR Rule 45.65(3) & 45.66(2)

[23] CPR Rule 45.65(4) & 45.66(4)

[24] CPR Rule 45.67

[25] CPR Rule 45.65(3)(c) & 45.66(2)(c)

[26] CPR Rule 45.65(3)(b) & 45.66(2)(b)

[27] The Article 7(1)(a) state: “where this is necessary for overriding considerations of public policy of the Member State concerned, in particular when required to ensure the protection of the best interests of children or to prevent harm to the physical or psychological integrity of a person.

[28] CPR Rule 45.65(3)(a) & 45.66(2)(a)

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Reimagining Dispute Resolution Under Cyprus’s CPR 2023: The Emerging Role of Mediation

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