In a recent case the court dismissed a mediator's application to set aside a witness summons requiring her to provide evidence. The evidence related to a mediation over which she presided and which resulted in a settlement, that subsequently became the subject of litigation.
Background
The issue arose following a mediation some years previously between Farm Assist Limited (now in liquidation) (FAL) and the Secretary of State for the Environment, Food and Rural Affairs (DEFRA), at which the parties reached an amicable settlement.
Some six years after the mediation FAL sought to set aside the settlement, alleging that it had been agreed under economic duress. DEFRA wished to call the mediator to give evidence and both parties agreed that the mediator should be asked to provide evidence, including details of her private conversations with the parties. When approached, the mediator informed the parties that she had retained no relevant documents and had little factual recollection of the mediation. Unsatisfied with this response, DEFRA served a witness summons to require the mediator's attendance at the trial. The mediator attempted to set aside the summons, relying upon the express provisions of confidentiality and non-attendance as provided for by the mediation agreement. The mediator also argued that her evidence would have been confidential and/or irrelevant.
Decision
The judge decided that the mediator should give evidence and held as follows:
1. Confidentiality - the proceedings in the case were confidential between the parties and the mediator and it would therefore require the consent of all three to waive the confidentiality. However, the court, will where it is in the interests of justice to do so, waive this confidentiality. In this case, the allegation of economic duress could only be assessed by reference to what had happened in the mediation, and it was therefore in the interests of justice for the mediator to give this evidence.
2. Privilege – the court recognised that privilege in mediation proceedings might exist in many forms and discussed these in turn:
a. legal advice privilege: the use of correspondence between solicitor and client at mediation would not result in the privilege being lost;
b. litigation privilege: similarly, where the document is used for the purposes of the mediation, the without prejudice privilege will not be lost;
c. without prejudice privilege – all information provided in the course of mediation is deemed to be without prejudice and is not admissible in any litigation of the dispute. However, this is a privilege that belongs to the parties, and not to the mediator; the parties waived this when they agreed that a witness statement could be taken from the mediator;
d. mediation privilege: the court found that it is yet to be definitively determined whether there is such a privilege that extends to the mediation process as a whole, but that what privilege there is extends to the parties as opposed to the mediator.
3. The mediation agreement provided that none of the parties could call the mediator as a witness in any litigation, or arbitration "in relation to the Dispute" and that the mediation would be treated as confidential as between the parties and the mediator, except where the court made an order to the contrary. The "Dispute" was defined by the agreement as being a dispute relating "to the work performed by [FAL] on behalf of [DEFRA] during the foot and mouth epidemic in 2001". The court held that the current proceedings related to the circumstances under which the settlement agreement was entered into, rather than a "Dispute" as narrowly defined by the terms of the mediation agreement, and therefore the confidentiality provision did not apply.
4. Even though the mediator claimed that she had little recollection of the mediation, there was a possibility that she would recall certain details when presented with documents.
Comment
This decision highlights the exceptional circumstances in which it is in the interests of justice for the court to refuse to uphold the confidentiality provisions in mediation agreements, and grant an application requiring the mediator to give evidence of the mediation. Here, economic duress was alleged and the conduct of the parties at the mediation had to be assessed in order to determine whether the settlement agreement should be set aside.
The case serves as a reminder that mediation is a form of assisted without prejudice negotiation and that the limits of without prejudice negotiations apply equally to mediation. Similar situations in which evidence may be sought include those where maintaining confidentiality would allow perjury or blackmail, or where referring to without prejudice material is necessary to explain a delay, or similar issue. However, it is likely that the decision would have differed if one of the parties had been unwilling to seek evidence from the mediator and not waived their right to without prejudice privilege.
This decision warns potential parties to mediation that confidentiality provisions in a settlement agreement need to be carefully structured. There are circumstances in which even the most cautiously worded agreement may not protect against issues such as serious misconduct, which the court might choose to examine. It also serves as a useful reminder to parties and mediators to consider taking detailed notes during the mediation.
Finally, a mediator seeking to avoid being called as a witness in proceedings relating to that mediation should ensure that any agreement to that effect is drafted in the broadest terms and captures all potential subsequent proceedings.
This decision should also be read in the light of the EU Directive on Mediation, which seeks to preserve confidentiality in mediations subject to public policy exceptions. UK laws are required to comply with this Directive by May 2011.
Further reading: Farm Assist Limited (in liquidation) and the Secretary of State for the Environment, Food and Rural Affairs (No.2) [2009] EWHC 1102 (TCC)
This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to www.law-now.com/law-now/mondaq
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The original publication date for this article was 03/07/2009.