The recently gazetted Mediation Bill (the "Bill") aims to protect the confidential nature of any "mediation communication", which is any communication made for the purpose of or in the course of mediation. This definition encompasses all communications between the parties or between a party and the mediator not only during but prior to the mediation proper, and thereafter, provided that it falls within the definition, but does not include an agreement to mediate or a mediated settlement agreement. It is anticipated that the Bill, when enacted, will imbue greater confidence in parties in the mediation process, and thus encourage parties to participate in the process with greater focus and commitment.

Confidentiality and admissibility of mediation communications

The Bill provides that mediation communications are confidential and must not be disclosed except under expressly specified circumstances. These include, for example, where (i) all parties involved, including the mediator, have consented to the disclosure; (ii) the content of the communication is already in the public domain (except due to an unlawful disclosure); or (iii) disclosure is necessary to prevent or minimise the danger of injury to a person or serious harm to the well-being of a child. In such circumstances, the court's permission to disclose the communication is not required.

In other cases, if the parties wish to disclose a mediation communication, they must apply to the court for permission to do so. The court's permission is also required in all cases where a party wishes to adduce a mediation communication as evidence in court proceedings. Examples of circumstances in which the court's permission is required (to disclose or adduce as evidence) include where a party seeks to (i) enforce or challenge a mediated settlement agreement; or (ii) establish a complaint of professional misconduct made against a mediator or other professional who participated in the mediation.

Applicability

The Bill, when enacted as legislation, will:

  • apply to mediations that are conducted in Hong Kong or where the agreement to mediate provides that the laws of Hong Kong will apply to the mediation;
  • be of retrospective effect. In other words, any attempt to disclose a mediation communication (or to adduce it in evidence) will be subject to the restrictions in the Bill even if the mediation (to which it relates) took place before the legislation comes into effect;
  • not apply to a number of processes including (i) mediations provided for in the Labour Relations Ordinance, Ombudsman Ordinance, and the Arbitration Ordinance; and (ii) various conciliations, some of which include those provided for in the Labour Tribunal Ordinance, Labour Relations Ordinance, and the various anti-discrimination ordinances.

Comment

Mediation is one of the cornerstones of the Civil Justice Reform, and has now become a fixture in civil proceedings. Judges and Masters are actively encouraging the parties to consider mediation and are penalising parties that unreasonably refuse to mediate. Despite this judicial emphasis on mediation, there is a perception that many parties are not yet comfortable with using documents and passing information to each other during the mediation process. For example, in our experience, some parties are still somewhat reluctant to have private discussions with the mediator outside the mediation proper, even though most experienced mediators welcome any opportunity to hear a party's views. Many parties are also uncomfortable setting out their 'without prejudice' position in writing for the purposes of a mediation. With the introduction of legislation that expressly protects the confidentiality of communications that are made not only in the course of but also for the purpose of mediation, it is hoped that litigants will make better use of the mediation process with the comfort that such statutory protection exists.

The Bill is expected to be introduced in the Legislative Council for reading on 30 November 2011. At present, there is no firm time frame for its enactment or coming into force.