Law and Legislation
The current national legislation incorporates the provisions of mediation in the Code of Civil Procedure. At present there is no specific statutory scheme for mediation. However, the Netherlands Mediation Institute (NMI) does have special schemes for mediators. There are 2001 NMI Mediation Rules, which set out the conditions to be fulfilled by the mediator and the mediation. The NMI also has a complaints procedure. This regulates where parties can lodge a grievance about the performance of a mediator in a particular case. There is also a disciplinary board for mediators.
Voluntariness
On 4 June 2002 the District Court of Haarlem ruled on the voluntariness of mediation. The parties who appeared before the judge had agreed orally on 16 November 1999 to resolve their dispute by mediation. A few minutes after the start of the first meeting one of the parties withdrew. The other party applied to the court for performance of the oral agreement. He considered that the agreement obliged the other party to make a reasonable effort to ensure the success of the mediation. The judge disagreed. Voluntariness is one of the basic principles of mediation and is also recorded in the NMI Mediation Rules. Article 4 of these Rules provides that each of the parties and the mediator may terminate the mediation prematurely. The judge felt that there would be no point in obliging a person to continue the mediation if this could be terminated at any desired moment and without giving reasons.
This judgment may possibly have implications for so-called mediation clauses'. When parties reach agreement in a mediation procedure, they record the agreements in a settlement agreement. This often also includes a provision that if disputes arise about the implementation of the agreement the parties will once again seek the help of a mediator before resorting to litigation. Such a clause is also sometimes used by commercial parties who have frequent business dealings with each other. If the position taken by the District Court of Haarlem were taken to its logical conclusion, it would mean that the mediation clause is not enforceable in practice. In other words, the parties are obliged to appear before the mediator, but cannot subsequently be compelled to use their best endeavours to ensure the success of the mediation. This is a practical ruling. As mediation depends on the commitment of the parties, there would be no point in compelling parties to remain at the mediation table against their will. If they were so compelled, it would in turn result in litigation in which parties seek to demonstrate that they have used their best endeavours. This would hardly be conducive to the desired dejuridification' of disputes !
Instituting new proceedings
Article 8 of the NMI Mediation Rules provides that if parties opt for mediation, any pending proceedings before the courts will be stayed until the mediation has ended. The article also provides that no new legal proceedings may be instituted during the mediation. This is to ensure the smooth passage of the mediation.
A husband and wife had difficulty in settling their divorce. Various topics had to be regulated such as access to the children, maintenance and the division of assets. They called in the assistance of a mediator. During the mediation it transpired that no agreement could be reached about maintenance. However, the husband wished to continue negotiating on the division of assets. This is why he did not wish to terminate the mediation. But he instituted legal proceedings concerning the maintenance so that this could be arranged without delay. The wife attempted to convince the judge that he should not deal with the case because the husband was entitled to institute legal proceedings only after termination of the mediation. The judge set aside the wife's objections. He considered that in these circumstances it would be contrary to the dictates of reasonableness and fairness' to apply article 8 of the NMI Mediation Rules. The judge therefore made an exception and dealt with the husband's application regarding maintenance.
Binding nature of agreements
If an expert's report is ordered during mediation, is the order binding ? Article 8.2 of the mediation agreement provided that agreements made between the parties during the course of the mediation would be binding on them only in so far as they were recorded in writing between them'. In such an agreement the parties may provide that the agreements concerned will no longer be binding on them if and when the mediation ends without a settlement agreement as referred to in paragraph 1.
The District Court of Utrecht heard a case in which the parties had started the mediation informally, in other words without a prior written agreement. They had also asked an external expert to draw up a report. Article 8.2 of the mediation agreement was therefore not (yet) applicable. The court was asked to rule on the status of the agreement concerning the expert's report. The judge held that during mediation each party was obliged to use its best endeavours to reach a settlement and in the process to show understanding for the other's point of view and that the parties should dare to make agreements. But as the parties had not made any further agreements and the mediation had ended without agreement, the agreement on the expert's report was no longer binding on the parties. This was therefore in keeping with the provisions of article 8.2.
The District Court of Utrecht had previously been asked to rule on the application of article 8.2 of the mediation agreement. The parties in this case were using mediation to regulate the consequences of their divorce. A list of agreements had been made and signed by the parties at a given moment during the mediation. Ultimately, however, they did not sign a final settlement agreement. Nonetheless, one of the parties demanded performance of the listed agreements. The judge held that this concerned matters that had been agreed in writing between the parties during the course of the mediation' and that they were therefore binding pursuant to article 8.2. The defendant disagreed with the judgment and appealed to the Court of Appeal of Amsterdam. He claimed that during the mediation agreement he had felt overwhelmed and pressurised and had, as a result, completely lost sight of the nature of the subject matter. The judge held that he should have raised this point earlier. The fact that his lawyer had been present when the settlement agreement was drawn up and that there had been sufficient opportunity for him to consult with the lawyer was a factor taken into account by the judge in dismissing this defence. This judgment is of great importance to lawyers who attend mediation. If they do not intervene during the mediation they forfeit the opportunity to do so. During the proceedings their client can no longer claim that matters were incorrectly represented. It is the duty of the lawyer to point out the consequences to his client during the mediation.
In 2002 the District Court of Arnhem had to rule on the nature of the agreements recorded in a settlement agreement. The parties had a dispute about a physiotherapy practice. During the mediation they reached agreement. However problems arose during the implementation of the provisions of the settlement agreement as they proved to be unclear. The parties therefore convened a second mediation session, in which the agreements were confirmed, clarified and supplemented. No record of the session was kept by the mediator and no second settlement agreement was drawn up. When the disputes arose again, legal proceedings were instituted in order to compel performance of the agreements. The judge naturally agreed that the original settlement agreement was valid and contained binding agreements. However, the judge decided otherwise in respect of the oral agreements. The parties disagreed about the content of these agreements as there was insufficient record of them. The judge could not therefore order either of the parties to comply with these (unclear) agreements. In order to be sure that a party actually performs the agreements, the other party must ask the court to impose a coercive fine. As the parties were committed to working together for some considerable time longer and had to transact business together and the imposition of a coercive fine would lead to further disputes and escalation, the court dismissed the application.
The lodging of documents and the confidentiality of information in the proceedings
What is the position regarding the confidentiality of documents used during the mediation ? Do they remain confidential when the parties once again come before the judge ? In legal proceedings much value is attached to establishing the truth. Which of the two principles is more important: confidentiality or establishment of the truth ? The case law on this does not yet provide a clear answer.
The District Court of Arnhem held on 5 December 2003 that it would not examine what had been discussed in the mediation owing to the confidential nature of the mediation. In 2000 the same court ruled that the confidential nature of mediation continued to exist after its termination. However, disputes which had not been fully discussed in the mediation and which had been referred to the court in the context of entirely new proceedings could be discussed. In January 2003 the District Court of Arnhem held that e-mail correspondence with the mediator could not be introduced into the proceedings since it was covered by the duty of secrecy under the mediation agreement.
The District Court of Arnhem was consistent in its three judgments. But shortly after the last judgment the Court of Appeal of Amsterdam held in another case that establishing the truth was more important than confidentiality. Although the Court of Appeal held that lodging such a document was by no means an obvious course of action since the parties had agreed secrecy', it considered that none of this constituted an argument that would weigh so heavily that a party could not use such a document as evidence. The District Court of Utrecht did not follow the judgment of the Court of Appeal of Amsterdam. In its judgment of 2 February 2005 the court held that the information which had been used in drawing up the settlement agreement was covered by the duty of secrecy. This did not apply to the signed settlement agreement. As the law on secrecy and confidentiality has not yet crystallised, it will be necessary to await a judgment of the Supreme Court on this subject.
Right of excusal
A mediator's right of excusal is closely connected with the principle of confidentiality. This concerns the question of whether a mediator may be called as a witness in later court proceedings. Various professional groups can claim to be excused from giving evidence. Examples are lawyers, doctors and notaries. At present mediators do not have the right of excusal unless they are also lawyers. But what is the position if a lawyer acts as mediator ? Views differ on this. For example, the Disciplinary Board for Mediators has ruled that a lawyer/mediator is not entitled to invoke his right of excusal in his capacity as a lawyer. According to the Board a lawyer who acts as mediator is not exercising his profession as a lawyer. The rules for lawyers do not therefore apply. However, the Bar Disputes Committee does not agree with this. The Committee considers that the Bar's disciplinary rules do apply to a lawyer who is acting as a mediator. A client must be able to rely on the fact that his lawyer/mediator is bound by all rules governing lawyers, unless these rules have been expressly excluded.
On 29 September 2004 the District Court of Almelo held that an NMI-certified mediator could in principle invoke his right of excusal in his capacity of a lawyer on the basis of the principle of confidentiality of mediation, as recorded in the NMI Rules and in the mediation agreement signed by the parties. A problem that arose in this case was that one of the parties was assisted by a third party who had not countersigned the mediation agreement. The mediator was entitled to exercise the right of excusal in respect of those questions which were subject to reasonable doubt or which could be answered truthfully without revealing what should have remained concealed.
Below can be found more examples of case law. All these judgments, with the exception of LJN AE 5262, have been published on www.rechtspraak.nl.
District Court of Haarlem, 4 June 2002 LJN AQ 2615, case number : 78515/HA ZA 01-1435 After ending their affective relationship the parties agreed to settle the division of their assets by means of mediation. The defendant left the first meeting after only a few minutes. Under clause 4 of the mediation agreement, which provided that each of the parties and the mediator could voluntarily terminate the mediation procedure if they so desired, the District Court held that the husband had not acted unlawfully in relation to the wife by leaving the mediation meeting.
District Court of Utrecht, 4 June 2002 LJN AE5262, case number 112617/HAZA 00-588 During the mediation the parties drew up and signed a list of agreements. The mediation did not end with the adoption of a settlement agreement. One of the parties argued that as there was no settlement agreement as referred to in clause 8.2 of the mediation agreement, he was entitled to assume that he was not yet under any legally binding obligations to the other party. This argument was not accepted by the District Court. As this party was assisted by his lawyer during the mediation, the District Court also rejected his defence that he felt overwhelmed and pressurised during the mediation.
Court of Appeal of Amsterdam, 10 December 2003 LJN AR5521, case number 670/02 This was an appeal against the judgment of the District Court of Utrecht of 4 June 2002 (see above). The Court of Appeal upheld the judgment of the District Court. As the parties could, if they wished, withdraw during the mediation sessions for confidential consultation with their lawyers (when the mediator and the other party were not present) and both parties had made use of this possibility, the Court of Appeal considered this to be a decisive factor and held that the document signed by the parties contained agreements that were binding on them as referred to in clause 8.2 of the agreement.
District Court of Arnhem, 13 November 2002 LJN AQ2634, case number 92344/KG ZA 02-661 In the course of mediation the parties concluded a settlement agreement on the use of a physiotherapy room. Problems arose during the implementation of this agreement and a fresh mediation session was convened. During this session further oral agreements were made. As the parties subsequently disagreed about the contents of these agreements, performance of them could not be requested in interim injunction proceedings.
District Court of Utrecht, 24 September 2003 LJN AQ2600, case number 130073 During mediation the parties agreed that an expert third party would value certain companies that were to be apportioned. The mediation agreement was signed some considerable time after the mediation was initiated. The mediation did not result in the conclusion of a settlement agreement. The District Court held that the nature of the legal relationship between parties to a mediation process meant that the agreements they made with each other were not binding on them if and in so far as the mediation process did not result in a settlement, unless they had agreed otherwise.
District Court of Arnhem, 18 November 2003 LJN AQ 2547, case number FA RK 03-12043 During a mediation procedure involving the settlement of a divorce, the husband instituted legal proceedings concerning his maintenance obligation towards his wife. The wife argued that her husband's application should be declared inadmissible. The District Court held that since the parties agreed that they would not reach agreement on the maintenance obligation in the mediation procedure, the rule that no new proceedings should be instituted during the mediation could be disregarded under article 6:248, paragraph 2, Civil Code.
District Court of Arnhem, 5 December 2003 LJN AQ2565, case number 106569 / KG ZA 03-773 The parties disagreed about what had been agreed in the mediation procedure concerning access. At the court hearing they raised what had been discussed during the mediation. The District Court held that this could not be considered since the nature of the proceedings was different.
District Court of Almelo, 29 September 2004, LJN AT4104, case number 61101 HA ZA 03/910 The right of the mediator to claim confidentiality applied only in respect of what the parties had told him during the conclusion of a mediation agreement and not in respect of what he had been told by third parties present at the mediation.
District Court of Utrecht, 2 February 2005 LJN AS5144, case number 178258 / HA ZA 04-113 The non-disclosure clause in a mediation agreement barred a party from adducing evidence by examining witnesses who had been present at the mediation.
District Court of Arnhem, 25 May 2005 LJN AU0366, case number 122055 / HA ZA 04-2431 Where an agreement had been made about the cost of mediation, the District Court held that a price indication implied that the final fee could be higher. As the mediator had itemised his activities in detail and had submitted a claim in accordance with the agreed hourly rate, the fact that the price indication had been overly optimistic did not in itself mean that claims in excess of the estimated amount need not be paid. Another matter in dispute was the quality of the work performed professionally by the mediator, since it was argued that the mediator had made serious errors. The defence claimed that the duty of confidentiality prevented this aspect of the dispute from being submitted to the courts. The District Court held that the duty of confidentiality contained in the mediation agreement between the parties (standard mediation agreement) did not apply in a professional liability proceedings.
