In resolving litigation, most disputes are the subject of
mediation. Supreme Court statistics show that approximately
97% of matters are resolved before trial and that the
mediation process is the central contributor to such a high success
The recent Supreme Court decision of C v M  WASC
175 is a useful reminder of seriousness of the obligations of
confidentiality and the without prejudice nature of documents
prepared in relation to mediation and discussed at mediation.
Usually mediation orders spell out the obligations on the
parties, as do the mediators at the commencement of
mediation. Section 71 of the Supreme Court Act
provides that anything said or done, any communication or any
admission made during an attempt to settle a matter by mediation is
taken to be in confidence and is not admissible in any proceedings
before any court, tribunal or body. It further provides that
any document, copy or evidence of such a document prepared in that
context is also subject to the duty of confidence and is therefore
not admissible in any proceedings before any court, tribunal or
In C v M an action in the Supreme Court was referred to
mediation. The parties were accompanied by their lawyers but
it failed to produce a settlement of the claims. Following
mediation, M's solicitor properly sent his client a report on
the mediation by email later that same day marked "Private and
Confidential". Instead of maintaining confidence, M
forwarded the email to at least 5 other people with investment
interests in the business. The email itself "was heavily
slanted towards the defendant's position, as one might
expect." A copy eventually ended up in the hands of
C, the other party.
M admitted forwarding the email to others. C complained
that the confidentiality provisions surrounding the mediation had
been violated and sought permission to contact the unauthorised
recipients of the email 'to set the record straight'.
Justice Kenneth Martin stated that the statutory obligation of
confidentiality attaching to mediations "is intended to
promote an open, protected environment for parties to frankly and
freely attempt to reach the resolution of their civil
disputes" and that the protection of confidentiality
remains unless the parties agree or the court so orders. A
wider obligation of overarching confidentiality, applicable to all
proposed participants in the mediation is imposed such that
disclosure to third parties is prohibited. The unilateral
disclosure of the email was "a violation of an
indispensible protective component of the court's
processes" and might also amount to a contempt of
M was required to provide an affidavit identifying who else may
have received the information in the email but the court was not
prepared to make an order unilaterally permitting C to respond by
communicating with those recipients, asserting that "one
confidentiality violation... is more than enough." It
was, however, prepared to allow a tailored communication prepared
by C's solicitors and approved by the court, essentially
explaining C's concerns over the content of the email.
Justice Martin stated that "It is essential
that the parameters of the regime of statutory confidentiality
applicable to a mediation by direction be well understood by legal
advisers. They must then clearly and carefully communicate and
explain to their clients what obligation this carries when a
mediation is conducted. Where communications are
proposed to be made about what has occurred or been said at a
mediation, particularly by an email communication, the modern day
potential for the on-forwarding of email communications to become
'viral' in seconds must be recognised. Appropriate care
must be taken to preserve the regime of confidentiality which is
permanently attached to mediation communications."
If in doubt about these obligations, clients should seek
clarification from their legal advisor.
For more information about this legal update or any other
commercial litigation matters please contact Mark
Fatharly on (08) 9321
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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This was an interlocutory decision about the appointment of a tutor for the child appellant, to carry on his proceedings.
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