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Are Mediations Without Prejudice?

The SCC recently discussed the question of the without prejudice nature of mediations in The Association de mediation familiale Québec v Bouvier 2021 SCC 54

In this case a couple from Quebec separated and entered a mediation process regarding parenting and child support for their two children. The mediator recorded his conclusions regarding what had been agreed upon in the mediation in a document called “summary of mediated agreements”.

Subsequently, one party applied in court for more support than was provided for in the mediation summary. He denied a contract had been reached and objected to the admissibility of the mediation summary in evidence.

At trial, the court relied upon Union Carbide Canada Inc v Bombarier 2014 SCC 35 in support of admitting the mediation summary into evidence. It held that based on the summary and on the parties’ post-mediation conduct, there was a valid contract. This decision was appealed. The appeal was dismissed.

The Association sought leave to appeal as a 3rd party to the SCC and leave was granted.

The appeal was dismissed by the Supreme Court.  The contract negotiated in mediation was upheld.

Settlement privilege, though very important, is subject to a settlement exception as articulated in Union Carbide.  That is, when a settlement is reached the settlement discussions are no longer confidential. The purpose of the settlement privilege is to promote honest and frank discussions which can make negotiations more effective in reaching agreements. It is also true that settlement privilege promotes the making of offers that may involve a degree of compromise which a party may not want communicated to a future judge or arbitrator in the event the proposed compromise did not result in settlement. In other words, litigants will be disinclined to compromise if they believed those compromises could be used against them in court. 

The Association’s position on the appeal was that unlike commercial mediation, family mediation should be subject to absolute confidentiality in order to protect vulnerable spouses. Justice Kasirer disagreed on the grounds that unlike commercial mediation, family mediation in Quebec is subject to a “set of special norms” that protect vulnerable spouses.

The special norms – procedural safeguards – absent in commercial mediation, is the involvement of two unique actors: a government certified mediator chosen by the parties under the standard mediation contract, and a judge who is asked to confirm any agreements arising from family mediation. 

Apart from evidentiary issues, this case confirms what most of us probably understood – that a mediator’s written summary of a settlement arising from mediation, unless it becomes formalized in some way that evidences acceptance by each party (e.g., signing the mediator’s summary, or communicated acceptance of it in some other clear fashion following mediation), is not a contract even though it may be admissible evidence in ultimately determining whether a contract was reached and what the terms of it were. The parties’ mediation agreement states this explicitly in paragraph 10 of the agreement. (par. 9) This is also a common provision in mediation agreements outside of Quebec. Another is a provision in many mediation contracts, usually initiated by the mediator, that they will not be compellable witnesses in a subsequent dispute between the parties.

There is no absolute confidentiality in mediations when the issue is whether a binding agreement was reached or what the terms were.

This approach, this exception to the confidentiality rule, is consistent with the purpose of the confidentiality. The purpose is to encourage settlements. Settlements are encouraged when parties have the ability to refer to evidence that may suggest for or against a settlement having been reached.

This is in no way a slippery slope. Where no settlement was reached, parties’ settlement offers made during an unconsummated negotiation remain confidential. They may not be referenced for the purpose of influencing the judge to rule one way or another on a substantive issue.

It is important at the end of each mediation to clarify if (a) this is a binding deal, or b) if the parties wish a cooling off period and the agreement is binding once placed in a consent order, or contract. Self represented participants in mediation need to understand at the end of a session fi they are signing minutes of settlement or flip chart notes this can be evidence of an agreement reached.