Confidentiality within mediation

One of its most defining features is confidentiality, which serves as a cornerstone for building trust among parties, fostering open communication, and ensuring the process’s integrity.

The principle of confidentiality

Confidentiality in mediation means that the information disclosed during the mediation process cannot be used outside of it without the consent of the parties. This principle creates a safe space for participants to discuss their concerns, explore solutions, and negotiate openly without fear of reprisal or exposure.

The key elements of confidentiality include:

• privacy of proceedings: mediation sessions are private, involving only the parties, their representatives, and the mediator. This contrasts sharply with the increasingly public nature of both civil and family court proceedings
• protection of communication: statements made during mediation are typically inadmissible in court, fostering candor and creative problem-solving although it is important to read the exceptions to that below
• mediator neutrality: mediators are bound by confidentiality and cannot share details of the mediation with anyone outside the process.

Legal and ethical frameworks

Confidentiality in mediation is supported by legal and ethical standards that vary by jurisdiction but often share common themes.

Parties will often sign confidentiality agreements before mediation begins, reinforcing the private nature of the process and establishing grounds for legal recourse if confidentiality is breached.

In some cases, courts may mandate confidentiality in mediation, providing additional assurance to participants.

Benefits of confidentiality

Confidentiality in mediation carries with it many benefits that contribute to its effectiveness as a dispute resolution method:

• encourages open communication
• preserves relationships: by keeping discussions private, mediation reduces the risk of public conflict and helps preserve personal or business relationships
• promotes creative solutions: without fear of external scrutiny, participants can propose innovative and unconventional solutions
• minimizes risk: confidentiality shields parties from the potential harm of having sensitive information disclosed publicly.

Challenges and limitations

While confidentiality is a fundamental aspect of mediation, it is not absolute. Certain exceptions may apply:

1. Legal obligations: mediators may be required to disclose information if mandated by law, such as in cases involving criminal activity or threats to public safety. The High Court case of Berkeley Square Holdings & Ors v Lancer Property Asset Management Ltd & Ors reminded us that legal privilege and confidentiality surrounding mediation is not impenetrable.

The case involved accusations of secret and fraudulent transactions of enormous sums, and whether the defendants in the proceedings could rely on extracts from position statements that had been submitted during early mediation sessions with the claimants.

The defendants argued that the extracts would show that the claimants had been aware of the transactions for some time, thereby defeating the allegations being made against them. The claimants, however, sought to argue that the statements were protected by mediation privilege and could not be disclosed.

The judge set out a summary of the position and where confidentiality in otherwise protected negotiations could in principle be set aside, as follows:

a. where there is a dispute as to whether negotiations have resulted in a concluded settlement;

b. where one party claims that the negotiated settlement should be set aside because of fraud, misrepresentation or undue influence;

b. where, despite the absence of a settlement, an estoppel is said to arise out of something said during negotiations;

d. where privilege is being used as a cloak for perjury, blackmail or other ‘unambiguous impropriety’;

e. where evidence of the negotiations could be used to explain delay or apparent acquiescence;

f. where it is relevant to the interpretation of the settlement agreement to admit objective facts referred to in the negotiations;

g. where the ‘Muller exception’ arises where (i) there is no issue as to the truth or falsity of anything stated in the negotiations; and (ii) admitting evidence of what was said is necessary in order to ensure that an issue raised by one party is ‘fairly justiciable’; and (iii) there is no adverse effect on the protection to which the other parties are entitled.

In this case, the judge held that both the fraud exception at paragraph (b) as well as (g) applied and therefore allowed the privileged evidence of the negotiations to be introduced into the proceedings.

2. Informed consent: parties may agree to waive confidentiality for specific purposes, such as enforcing a mediated agreement.
3. Ethical dilemmas: mediators must balance confidentiality with ethical responsibilities, particularly in situations involving harm to others.