Mediations: Confidentiality and Mediators’ Duties

-by Joseph J. Sullivan, C.S., Sullivan Mediations

The primary responsibility for review of case law and legislation at private mediations rests with legal counsel. Most mediators firmly take the position that they are not giving legal advice at a private mediation and that is the role of the partisan lawyers.

Having said this, mediators may tangentially remind parties in a skillful manner about case law or legislation that might impact the case being mediated without providing an opinion. In contrast, pre-trial judges have quite a different role than mediators. A pre-trial judge ought to express a firm opinion on both the facts and the law of any particular case. Experienced mediators can raise certain areas of concern, both factually and legally, to the parties and their counsel and avoid giving a decisive opinion. A mediation conducted in this manner respects the important independent role of legal counsel. One risk of a mediator overstepping the bounds is this could create an issue between one of the lawyers and his or her own client if for example legal counsel is mistaken. There is case law that is relevant, perhaps more procedural in nature, of which counsel should be aware during the mediation.

In 2014, the Supreme Court of Canada released the Union Carbide Canada Inc. v Bombardier Inc. [2014] S.C.J. No. 35, May 8, 2014 decision. In Union Carbide the Supreme Court of Canada dealt with whether a mediation contract with an absolute confidentiality clause displaced the common law settlement privilege. At common law, settlement privilege is a rule of evidence that protects communications exchanged by parties as they try and settle a dispute. This privilege applies even in the absence of statutory provisions or contract clauses with respect to confidentiality. This rules promotes honest and frank discussions between the parties which can make it easier to reach a settlement. This common law settlement privilege ceases however, if it is necessary to disclose a communication to prove the existence or scope of the settlement.

Apart from this common law settlement privilege, mediation agreements often have absolute confidentiality clauses. Such clauses can displace the common law settlement privilege depending upon an interpretation of the mediation agreement. The parties may contract for a greater confidentiality protection than at common law. Mediation agreements therefore must be carefully worded with respect to confidentiality provisions.

In my view, the absolute confidentiality provisions in mediation agreements prevent disclosure as to what took place during the course of the mediation.

If a case settles, then Minutes of Settlement ought to be drawn that will set out the settlement terms. If any issue arises as to the terms or scope of the settlement, the Minutes of Settlement would then be the governing document.

By way of commentary, I note that pre trial judges will often ask “what happened at the mediation?” By the terms of most mediation agreements, legal counsel should advise the judge that there is an absolute confidentiality clause in a mediation agreement preventing disclosure as to what transpired during the session.

Rules of Professional Conduct

Rule 5.7-1 of the Law Society of Upper Canada’s Rules of Professional Conduct has certain requirements for lawyers who act as mediators. This rule requires that a lawyer who acts as a mediator shall, at the outset of the mediation, ensure that the parties understand fully that the lawyer is not acting as a lawyer for either party, but is acting to assist in settlement. Secondly, communications arising out of the mediation process may be covered by some other common law privilege and will not be covered by solicitor and client privilege.

Prudent mediators will have these comments in their written mediation agreement.

In the commentary under this rule, it is noted that the lawyer (acting as mediator) should not give legal advice, but might give “legal information to the parties during the mediation process.” For example, the mediator may give information on the consequences if the mediation fails.

In my view, the establishment of clear boundaries between legal counsel, mediators and pre trial judges should aid the settlement process.