Summary

  • Without prejudice privilege in mediation exists between the parties and is not a privilege of the mediator. The parties can choose to waive the privilege.  
  • The court will generally uphold confidentiality provisions in mediation agreements but, exceptionally, will order that a mediator give evidence about what took place in a mediation if it is in the interests of justice to do so.  

In the recent case of Farm Assist Limited (In Liquidation) v The Secretary of State for the Environment, Food and Rural Affairs (No. 2) [2009] EWHC 1002 (TCC) Mr Justice Ramsey considered an application by a mediator to set aside a witness summons. Ramsey J held that in exceptional circumstances, the confidentiality provisions between the parties and the mediator can be set aside in the interests of justice. The judge also commented on the difference between confidentiality and without prejudice privilege in the context of a mediation.

Background

The Department of Environment, Food and Rural Affairs (DEFRA) brought proceedings against Farm Assist Limited (FAL) in relation to FAL's handling of the foot and mouth epidemic in 2001. The parties attended mediation and as a result a settlement agreement was entered into. FAL then brought the current proceedings against DEFRA seeking to set aside the settlement agreement on the basis that it had been entered into under economic duress at the mediation.

Neither party objected to the mediator being called to give evidence about the mediation (including her private conversations with the parties). This led to the court directing the parties to write jointly to the mediator in an attempt to discover if she had retained any notes or documents from the mediation, whether she had any factual (or other) recollection of the mediation and inviting her to disclose to the parties such notes or documentation she may have retained. The mediator responded by saying that as the mediation had occurred many years ago she had very little factual recollection of the events. Furthermore, her files contained no personal notes. In response, DEFRA said that, nevertheless, its lawyers would wish to meet the mediator and take a witness statement. FAL stated that such an approach would be a waste of costs. The mediator refused and DEFRA then served a witness summons on the mediator seeking her attendance at the trial. The mediator applied to set aside the witness summons.

The Mediation Agreement

The Mediation Agreement contained a number of terms which have now become commonplace in mediation agreements and deal with such matters as the status of communications in the mediation. Clause 6 of the Mediation Agreement provided that each party was deemed to be agreeing to the confidentiality provisions in the Mediation Procedure.

The Mediation Procedure included terms providing that:

  • All communications relating to and at the mediation would be without prejudice;
  • All information produced for, or arising in relation to, the mediation would be kept confidential;  
  • All documents produced for, or arising in relation to, the mediation would be privileged and not be admissible as evidence or discoverable in any litigation or arbitration connected with the Dispute (as defined); and  
  • None of the parties to the Mediation Agreement would call the mediator as a witness in any litigation or arbitration in relation to the Dispute and the mediator will not voluntarily act in any such capacity without the written agreement of all the parties.  

Decision

Ramsey J dismissed the application and held that the mediator should give evidence in response to the witness summons. In reaching his decision, Ramsey J considered at length the legal and academic authorities on confidentiality and privilege in mediations and then summarised these as follows:

Confidentiality: The proceedings were confidential as between the parties and between them and the mediator. As a result the mediator could enforce the confidentiality provision (even if the parties agreed to refer to matters outside the mediation) and the court would generally uphold it, save where it considered it necessary in the interests of justice for evidence to be given of confidential matters. There was even, in the absence of express agreement, an implied confidentiality in mediation akin to the implied confidentiality in arbitration.

Without prejudice privilege: The mediation was covered by without prejudice privilege. However, it was a privilege which existed as between the parties and it was not a privilege of the mediator. The parties could waive the privilege.

Other privileges: If another privilege, for example, legal advice privilege, attaches to documents which are produced by a party and shown to a mediator, that party retains the privilege and it is not waived by disclosure to the mediator or by waiver of the without prejudice privilege.

Ramsey J then concluded that, in the interests of justice, the mediator should give evidence as to what was said and done in the mediation for the following reasons:

  1. The issue in these proceedings was whether the settlement agreement was procured by economic duress during the mediation. The allegations concerned what was said and done in the mediation and this would require evidence of what FAL said had been done by the mediator. That evidence formed a central part of FAL's case and the mediator's evidence was necessary for the court to determine properly what was said and done.
  1. The fact that the mediator had no recollection of the mediation did not prevent her from giving evidence. A witness summons would not be set aside because the witness says they cannot recall matters (R v Baines [1909] 1 KB 258). Memories might be jogged when documents were shown to witnesses and they had the opportunity to focus, in context, on events some years earlier.
  1. Calling the mediator to give evidence would not be contrary to the express terms of the Mediation Agreement. The parties' agreement not to call the mediator as a witness "in relation to the Dispute" was limited to litigation or arbitration in relation to the underlying dispute. Dispute was a defined term that related to the work performed by FAL during the foot and mouth epidemic in 2001 and did not extend to a dispute as to whether the settlement agreement was entered into under duress. However, Ramsey J noted that even if the wording of the Mediation Procedure did apply to this case, that would not in itself lead to the witness summons being set aside. Rather, it would be a factor for the court to take into account in deciding whether, in the interests of justice, the mediator should be called as a witness.
  1. By agreeing that the mediator could be called as a witness, the parties had waived any without prejudice privilege in the mediation and since it was their privilege, they were entitled to do so.
  1. The confidentiality provisions in the Mediation Agreement were binding as between the parties and the mediator. However, the court could permit the use of, or order disclosure of, the otherwise confidential material if it was in the interests of justice to do so. Whilst it was possible for the confidentiality to be waived, that had to be with the consent of all parties (including the mediator). Ramsey J concluded that the mediator had a right to rely on the confidentiality provision in the Mediation Agreement, but held that this case was an exception, where the interests of justice lay strongly in favour of evidence being given of what was said and done at the mediation.

Comment

Confidentiality is central to the mediation process and it is held up as one of the key reasons why the mediation process is successful. However, this case makes clear that there may be exceptional circumstances where in the interests of justice the court may override express confidentiality agreements and order a mediator to give evidence about what took place in the mediation.

There were several factors that made this an exceptional case: the conduct of one of the parties at the mediation was the subject of the proceedings; the allegations (of economic duress) were serious; and both parties were content for privilege to be waived and for the mediator to give evidence. Whilst this case should provide a warning that serious misconduct in mediation may be subsequently examined by the court, it is also right to observe that it would be rare for an experienced mediator to allow the mediation process to be abused in a way that would or could give rise to such a claim. In fact, FAL discontinued its claim against DEFRA after the hearing but just days before the judgment was handed down and the mediator was consequently not required to give evidence at trial.

Most mediation agreements will contain provisions seeking to restrict the parties' ability to call the mediator as a witness in subsequent disputes. This judgment may also see mediators inserting stricter provisions into their mediation agreements restricting the extent to which the parties may call them as a witness. That said, it appears from the judgment that even express words dealing with the situation that arose here would not have led the judge to a different conclusion. It would have been just one factor to take into account when applying the interests of justice test.