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The Enactment and Implementation of the Mediation Ordinance: Its Impacts and Implications

2012-07-01

Introduction

Mediation is a growing trend in dispute resolution, and there has been a widespread global support in having a proper legal framework on the conduct of its proceedings.Since the Civil Justice Reform in year 2009 in Hong Kong, mediation, after years of gestation, has become a rooted form of alternative dispute resolution.The Hong Kong Legislative Council passed the Mediation Ordinance Cap 620 (“the Ordinance”) on 15th June 2012.It would come into operation in early 2013 to further promotemediationin commercial and communal disputes, and provide a regulatory framework for mediation, in particular in relation to issues of confidentiality and admissibility (in court) of the mediation process.In this article, key provisions of the Ordinance will be discussed as well as the significant impact brought by its enactment and implementation.

Definition of mediation

According to section 4 of the Ordinance, mediation is defined as a structured process comprising one or more sessions in which one or more impartial individuals, without adjudicating a dispute or any aspect of it, assist parties to the dispute to do any or all of the following:-

1. identify the issues in dispute;

2. explore and generate options;

3. communicate with one another; and

4. reach an agreement regarding the resolution of the whole, or part, of the dispute.

This definition would include activities undertaken in arranging or preparing for the mediation, follow up on matters arising out of the mediation and also includes any mediation which is conducted in person or by electronic means.

Scope of application

According to section 5(1), the Ordinance applies to any agreement to mediate if such mediation is wholly or partly conducted in Hong Kong, or if the agreement to mediate specifies that the Ordinance (or the laws of Hong Kong) is to be applied, regardless of whether the mediation is conducted before, on or after the commencement date of the Ordinance.

Confidentiality

One of the most significant impacts of the Ordinance is to regulate and make confidentiality of “Mediation Communication” a requirement.According to the Ordinance, “Mediation Communication” is defined as “anything said or done, any document prepared or any information provided, for the purpose of or in the course of mediation, but does not include an agreement to mediate or a mediated settlement agreement”.

Section 8(2) also provides that a person may not disclose a mediation communication except in certain circumstances.Such exceptions fall into 2 categories.

First, mediation communication may be disclosed in certain situations without the approval of the Court, if or when:-

1. consent of all the disputing parties and the mediators(s) have been obtained;

2. content of the mediation communication is information that has been made available lawfully to the public;

3. content of the mediation communication is subject to discovery in civil proceedings;

4. disclosure is necessary to prevent or reduce the danger of injury to a person;

5. disclosure is made for educational or research purpose;

6. disclosure is made for the purpose of seeking legal advice or is made in accordance with a requirement imposed by law.

The second category of exceptions consist of certain situations where a person may disclose a mediation communication only if prior approval of the Court (or tribunal) has been obtained.For example, such situations may include where a party seeks to enforce or challenge the mediated settlement agreement; the disclosure is made for the purpose of establishing or disputing an allegation or complaint of professional misconduct made against the mediator; or for any other purpose that the Court or tribunal considers justifiable in the circumstances of the case.

Save the above exception, the mediation process is protected under the Ordinance.Thisis meant to bolster public confidence in mediation as confidentiality is regarded as the cornerstone of the whole mediation process.As a general rule, unless there are compelling justifiable reasons, no one would be permitted to disclose any mediation communication, which would hamper the process and the outcome of the mediation.

Admissibility in evidence

Under section 10 of the Ordinance, mediation communication may be admitted in evidence in court proceedings only with leave of the Court or tribunal.The Ordinance has provided some guidelines that the Courts have to consider when determining whether to grant leave for mediation communication to be disclosed or admitted in evidence.They include whether the mediation communication may be, or has been disclosed under section 8(2); whether it is in the public interest for the mediation communication to be disclosed or admitted in evidence.

Conclusion

With the enactment of the Ordinance, it is hoped that Hong Kong may develop a dispute resolution culture.That said, while the Ordinance recognizes the merits of mediation and provides a formal legal framework to help bring the virtuous functions of mediation into full play; certain important issues including the accreditation of mediators remain unresolved.The Ordinance is also silent on professional immunity for mediators and whether mediators can give any professional advice or opinion to any disputing parties.



For enquiries, please contact our Litigation & Dispute Resolution Department:

E:ldr@onc.hk                                             T: (852) 2810 1212

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Important: The law and procedure on this subject are very specialised and complicated. This article is just a very general outline for reference and cannot be relied upon as legal advice in any individual case. If any advice or assistance is needed, please contact our solicitors.
Published by ONC Lawyers © 2012


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Managing Partner
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