It is somewhat paradoxical that with the increasing popularity of mediation as a method of dispute resolution in both family and general civil litigation matters, it is likely that the number of claims against mediators, both lawyer and non-lawyer, will increase significantly over the next few years. The opportunity for expansion of ADR will in fact breed new litigation. These cases will consist of claims regarding possible ethics codes violation and liability issues. The increased "professionalism" and emergence of mediators as separate from their profession of origin will undoubtedly lead to more lawsuits involving mediators.

The downside of professional recognition is a professional standard of liability. If the standard applied is similar to that used by the courts in other professional matters, it will be a very high standard indeed. Although not a serious issue up until now with court connected or mandatory mediation, lawsuits are also much more likely.

This paper attempts to survey the literature and review the basis of potential claims against mediators in general, and deal with some specific concerns over such matters as the lawyer as mediator and mediating with non-represented parties. The areas of potential liability are likely to be breach of fiduciary duty, breach of contract and negligence. While much of this paper draws on family law examples, the issues remain the same for any type of mediation.

There is also the added dimension of whether mediation constitutes the practice of law which non-lawyer mediators must be mindful of although it is unlikely that the Law Society would take action against a non-lawyer mediator. In the U.S., this has been a significant issue.

In Ontario there have been few claims to date. There are no reported cases in Ontario or for that matter anywhere else in Canada. Even in the United States, where the whole ADR movement is far more advanced than in Ontario, there have not been a significant number of cases. As late as September 1996, it was reported in the Canadian Bar Association Ontario ADR section newsletter that insurance rates for ADR providers were around $800.00 per year which seemed excessive as there had never been a claim in Canada and very few in the US.

The ADR section has recently arranged group Mediator/Arbitrator's professional indemnity insurance for members with a $125.00 premium offering no deductible and coverage for $1,000,000.00 per claim and an annual aggregate of $2,000,000.00. This compares with AMIO's coverage which has a premium of $199.00 with a $500.00 deductible and a claim limit of $1,000,000.00 per claim and in the aggregate. The insurance is underwritten by Royal Insurance. When these rates are compared with the costs of insurance for lawyers in Ontario with a yearly premium of $5,050.00, and a deductible which ranges from $3,500.00 upwards, it is obvious that the insurance companies do not see a large underwriting risk in offering this coverage.

This view is supported by the low number of complaints, four formal complaints and "hints" of six others, received by the Academy of Family Mediators in 1995 and 1996. The complaints can be categorized as arising from two sources: lack of communication between the mediator and one or more of the clients and more importantly from a potential liability point of view, confusion over the role of the mediator.

The Lawyers Professional Indemnity Company (LPIC) in Ontario has not had to defend any claims against lawyers under its policy and those which have arisen out of the ADR Centre in Toronto are covered under the immunity provisions of the practice direction.

This happy situation may not last for long. It is of some interest that a recent popular book on Mediation called "You be the Judge" by Toronto lawyer, Norman A. Ross addresses the issue of insurance coverage with the following paragraph:

DOES THE MEDIATOR HAVE TO HAVE INSURANCE?

Does the mediator carry liability insurance? Most lawyers who mediate will be insured under their professional liability insurance programmes. This is a matter about which you should enquire. What sort of insurance is it? Does it afford protection for the mediator's negligent acts or omissions? While there is little experience in mediator negligence to date, one can envision cases of dishonesty or negligence where a mediator has an undeclared conflict of interest or conspires with one of the parties to a mediation, causing losses to the other. These days, all eventualities should be protected against. Failing to carry this kind of insurance will speak volumes about the mediator's business acumen, if nothing else. You should not have to bear the risk of mediator incompetence or dishonesty.

It is fair to say that in general most potential consumers and providers of mediation services have not addressed the issue of insurance in any way.

Despite the potential for claims, one of the leading Canadian texts or handbooks on family mediation, in its recent second edition, does not mention mediator liability, potential or otherwise although there is advice on the importance of written agreements etc. which clearly go a long way to avoiding claims or at least successful ones.

In the journal literature, special issues of Mediation Quarterly in 1984 reviewed "Ethics, Standards and Professional Challenges" and in 1985 "Legal and Family Perspectives in Divorce Mediation" were reviewed. In 1989, "Legal Issues Affecting the Practice of Mediation" were considered by the same publication but there has been little focus on mediator liability issues in either the academic or professional literature. It is almost as though caught up in the need to develop a theory of mediation which would support the increasing professionalization of mediators, the opposite side of the coin has been ignored.

Before embarking on a review of the problem, if there is one, it is helpful to try and define what mediation is and is not! It seems generally accepted that mediation is a process in which a neutral third person assist the parties in resolving their dispute without having any power to impose a result. The mediator functions by creating the conditions under which the parties will conclude a successful negotiation. There is no decision making power granted to the mediator only that of process managing.

The key to any definition or understanding of mediation and this is especially important from a liability perspective is that the parties make the decision to settle or agree and it is not imposed on them. The mediator as process manager or designer does not bear responsibility for the outcome provided that the process itself is not flawed. The mediator's duty consists of at least three elements to ensure a fair and open procedure. These elements have been characterized as the duty of impartiality, the duty to be thorough and the duty not to be coercive in the process.

OVERVIEW OF LIABILITY

The basis of mediator liability is and will be grounded in the concept of the mediator as a professional. While there is no all-inclusive definition of a professional, it is generally accepted in Canadian, British and American jurisprudence that there are a number of generally recognized characteristics which apply to a professional occupation:

1. The work being performed is skilled and specialized, derived from training or experience, and it is generally accepted that a substantial part of the work is mental or intellectual rather than manual;

2. Persons engaged in the occupation are expected to be committed to certain higher standards of service and principles not only for the benefit of the client but for the community as a whole; and

3. Persons practising in the profession are members of an association which regulates admission and standards for the profession.

The rise of a profession has been described as follows:

• Professions develop when jurisdictions become vacant, which may happen because they are newly created or because an earlier tenant has left them altogether or lost its firm grip on them. If an already existing profession takes over a vacant jurisdiction, it may in time vacate another of its jurisdictions or retain merely supervisory control over it.

Clearly, mediation is an emerging profession and mediators should expect that their actions will be held to the standards that the courts have imposed on professionals in general. Most cases will arise from the mediator's duty to provide competent mediation services. Unfortunately, at this stage, although there has been much discussion for at least ten years, there is no definition or standard to assist in determining what this actually means.

There is no reason to doubt that mediator liability exists in both contract and tort but of greater concern is the possible expansion of the concept the mediator as a fiduciary to deal with limitations in claims made in contract or tort. While courts have held in cases of special or fiduciary relationships that a rebuttable presumption of undue influence arises from the nature of the relationship, even if there is a fiduciary relationship between the mediator and parties to a mediation, the presumption should not arise because the mediator does not make the parties' decision, is not a party to the mediation and benefits only indirectly from the decision.

It is generally accepted that a cause of action for negligence arises if the following elements are present:

(a)A duty of care exists between the mediator and the party;

(b)There has been a breach of that duty in that the mediator's conduct is negligent or in breach of the standard of care required of him;

(c)Damages have been suffered which have been caused by the conduct of the mediator;

(d)The damage is reasonably foreseeable as arising from the mediator's conduct.

The standard of care of a professional is that of a reasonably competent and diligent professional. To attract liability, it is not enough to prove that the professional has made an error of judgment or not known about some particular part of professional knowledge, but it must be shown that the error or ignorance was such that an ordinarily competent professional would not have made or shown it.

BASIS OF POTENTIAL MEDIATOR LIABILITY

General liability

In one of the earliest articles on the topic, Arthur A. Chaykin divided the liability issues into four groupings:

(a)Liabilities that a mediator may be exposed to that are similar to the liabilities that any business person might face;

(b)Liability pertaining directly to mediation where causation and damages issues are not a barrier to a claim;

(c)Liability pertaining directly to mediation where causation and damages issues are barriers to a claim; and

(d)Liability to third parties effected by the outcome of the mediation process.

Chaykin then went on to set out nine descriptions of potential claims, most of which have not come to pass:

(i)False Advertising;

(ii)Breach of Contract;

(iii)Tortious Interference with Contract or Business Relations;

(iv)Fraud;

(v)Invasion of Privacy;

(vi)Defamation;

(vii)Breach of Fiduciary Duty; and

(vii)Malpractice or Professional Negligence.

The most obvious claims would be for breach of contract and malpractice with breach of fiduciary duty and breach of confidentiality being other areas of significant liability. According to Chaykin, at least three unique features distinguish mediator liability from analyses of other professional liability and make the development of a theory of liability quite difficult:

(a)The parties remain in full control of the process and responsible for the results;

(b)The mediator has no responsibility to third parties; and

(c)Mediators have special immunity privileges which tend to insulate them from liability.

It seems that the leading U.S. case on mediator liability remains Lange v. Marshall in the Missouri Court of Appeal, which, although giving comfort to mediators from the fact that the lawyer mediator in question was not found liable at the court of appeal level, unfortunately does not offer much guidance to us on the actual issue of mediator liability apart from the specifics of the case.

From the Canadian perspective, an article written by Judith Ryan basically saw the same potential dangers for mediators. Although warning that mediators must be cautious about making any expressed or implied representations that mediation will be cheaper, faster, or in some way better than litigation focused on the duty of the mediator to provide competent services and liability that might flow from this requirement which she saw as including an obligation on the part of the mediator to raise all issues necessary for a complete and fair settlement. After reviewing the only reported case in the U.S. to that date, which provided little guidance, the conclusion is that "Lawyer/mediators, therefore, would be well advised to obtain separate liability insurance to protect them against claims made against them in their capacity as mediators".

An 1988 article by Jay Folberg comments that although lawyers have long warned of the liability exposure faced by mediators and the need for defensive practices there had at the time been few claims. This was in contrast to the experiences of other professionals. Little has changed to date.

The primary areas of potential claims were seen to be breach of contract, negligence and breach of fiduciary duty. Folberg correctly points out that there is no established standard to which mediation services can be compared for the purposes of easily establishing liability although he speculated that the rise of cases and complaints against mediators might just be a function of time given the increasing popularity of mediation. Lawsuits and claims against service providers are usually the result of dissatisfaction with the process. Because the parties create the outcome and feel that the "own" the process, they are less likely to be dissatisfied later or to hold the mediator responsible for the result.

Confidentiality

The issue of confidentiality and privilege although separate are linked. A significant amount of the academic and professional journal literature concerning mediation ethics and practice has been concerned with this issue although not from the perspective of potential mediator liability.

In general the common law has given priority to the administration of justice over social values and there is no reason to expect that this view will change in the future. The classic statement regarding privilege was made in 1881 by Master of the Rolls Jessel and is set out in the leading Canadian text on evidence as follows:

• In the first place, the principle protecting confidential communications is of a very limited character. It does not protect all confidential communications which a man must necessarily make in order to obtain advice, even when needed for the protection of his life, or of his honour, or of his fortune. There are many communications which, although absolutely necessary because without them the ordinary business of life cannot be carried on, still are not privileged.... Therefore it must not be supposed that there is any principle which says that every confidential communication which it is necessary to make in order to carry on the ordinary business of life is protected. The protection is of a very limited character, and in this country is restricted to obtaining the assistance of lawyers, as regards the conduct of litigation or the rights to property.

Although the courts have shown some flexibility in expanding, the doctrine of privilege is still quite narrow. The leading case is that of Slavutych v. Baker in the Supreme Court of Canada in 1976 which confirmed the applicability of the Wigmore test. As this had been the basis for the few decisions concerning mediators it is worth setting out the four conditions which are used by the courts as the basis for determining privilege. They are:

1. The communications must originate in a confidence that they will not be disclosed.

2. This element of confidentiality must be essential to the full and satisfactory maintenance of the relation between the parties.

3. The relation must be one which in the opinion of the community ought to be sedulously fostered.

4. The injury that would inure to the relation by the disclosure of the communications must be greater than the benefit thereby gained for the correct disposal of litigation.

The text confirms that before consideration is given to broadening the existing limits of the doctrine of privilege it would have to be clearly demonstrated that the external social policy in question is of such unequivocal importance that it cannot be sacrificed before the altar of the courts.

There is a generally accepted view that mediation is a positive process of dispute resolution. It can be argued that at this time there is no distinct recognized mediator privilege in common law although there is a growing recognition of the central role which confidentiality plays in the mediation setting and that problem will have to be resolved on a case by case basis. Although confidentiality is "the cornerstone for the protection of communications within particular relationships", it alone is not sufficient to attract privilege.

Furthermore an argument can be made that the second part of the Wigmore test does not apply as there is no ongoing relationship between the mediator and the parties, especially in a private mediation setting, and it is obvious that the fourth part is subject to public policy considerations.

In Porter v. Porter, a 1983 decision of Mr. Justice Gravely of the Unified Family Court in Hamilton, the confidentiality of communications which took place in mediation carried out by a psychologist for the parties was ruled to be privileged under the Wigmore principles. The court had concerns over the fourth element of Wigmore's test and that specific consideration led to a mediator being required to testify in a Yukon case where there were allegation of danger to the children involved. In a more recent Ontario case, Mr. Justice Granger, held that although an agreement made through mediation was protected by the principles of privilege under the Wigmore test, during the "evidentiary phase" of the trial, it was admissible as an offer to settle on the issue of costs.

The question of a confidentiality in the arbitration process has been litigated in Lalonde v. Lalonde, where the court allowed the examination of an arbitrator by one party and the use of transcript on appeal. This was a departure from the generally assumed rule that arbitrators are not compellable witnesses on an appeal. If an arbitrator who is acting in an adjudicative role is compellable then so is a mediator.

The obvious solution to this problem, if indeed it is a problem given the Wigmore principles, is remedial legislation. That route has been followed in many American jurisdictions. This was specifically called for by Chief Justice McEachern of British Columbia in a 1987 case where he questioned the jurisdiction of the court to create "a blanket sort of privilege" for mediators.

In the U.S. the Wagshal v. Foster case in 1994 extended absolute quasi-judicial immunity to mediators and case evaluators in the superior court's ADR program. The issue of judicial immunity in the U.S. is closely connected with the development of public ADR. Where the ADR options are statutorily authorized, some legislatures provide for judicial immunity within the legislation or rules. If not, the common law requirement that actual damages be proven to have resulted directly from the mediator's actions may in effect provide some immunity.

For example, the legislation in Pennsylvania protects the confidentiality of statements and documents produced or created for mediation, makes them inadmissible in judicial or other proceedings and non-discoverable. The protection does not apply to documents which existed independently of the mediation or in criminal matters. In Oregon, a recent revision of the law on confidentiality in mediation, the statute distinguishes between "mediation communications" which are confidential and the "mediation agreement". There is different treatment for private parties, non-state agency public bodies or state agency public bodies. With private parties, mediation communications are automatically confidential unless the parties agree otherwise. Exceptions include reporting child or elder abuse, and when one party or mediator reasonably fears serious harm to another. Mediation agreements are not confidential unless the parties agree that they are to be so. With public bodies, mediation is not confidential.

The Ontario Family Law Act provides for mediation as does the Children's Law Reform Act although the recent amendments to the Divorce Act do not. In both cases, the parties can opt for open or closed mediation. If the parties decide on closed mediation, no evidence of anything said or of any admission or communication made in the course of the mediation is admissible in any proceeding, except with the consent of all parties to the proceeding in which the mediator was appointed.

In Ontario, the Government's original proposal for rules covering province wide mandatory mediation, confidentiality issues were dealt with without reference to immunity from claims for the mediator. Statements and documents, if not otherwise subject to discovery, are not admissible in the proceedings, even to impeach credibility. If the parties reach a settlement, details are to be filed with the court, if no settlement only the mediators report is to be filed. The Secretariat's revision is basically the same but eliminates the need to file details of the settlement with the court. There is no mention of mediator immunity in the proposal nor in the discussion paper which is unusual given the practice in other jurisdictions and in the Ottawa project.

Mediators customarily promise confidentiality to all parties, therefore risk of law suit for malpractice. In order to deal with this issue, many mediators contract for confidentiality in their agreements to mediate and the careful mediator also sets out the limits to such confidentiality.

The potential problems with this approach are that the contract is not binding on third parties and if considered, an agreement to prevent evidence being brought forward in court bears the risk of being void for public policy reasons.

Disclosure

As noted above, while there is no absolute privilege or duty of confidentiality, in certain cases there is a positive duty imposed on the mediator to disclose certain information. For example, the Child and Family Services Act of Ontario set out a duty to report child abuse. The section applies to every person who performs professional or official duties with respect to a child including

(a)a health care professional, including a physician, nurse, dentist, pharmacist and psychologist;

(b)a teacher, school principal, social worker, family counsellor, priest, rabbi, member of the clergy, operator or employee of a day nursery and youth and recreation worker;

(c)a peace officer and a coroner;

(d)a solicitor; and

(e)a service provider and an employee of a service provider.

The section specifically applies even though the information reported may be confidential and no liability attaches to reporting unless the person doing so is acting maliciously or without reasonable grounds. The only exception to the rule is that it does not abrogate any solicitor client privilege. Other grounds for disclosure include a reasonable fear of one party causing harm to the other party or the mediator and court ordered disclosure. If disclosure is made outside these examples, a mediator could face a claim.

Breach of Codes of Conduct

It has been suggested that an essential element of any successful negligence claim will be a failure of the mediator to comply with acceptable standards of practice. A failure to comply with professional rules of conduct may in an appropriate case be evidence in support of a finding of negligence or breach of fiduciary duty in a civil suit, although this is more likely if it is a breach of a code of the mediator's profession of origin. The rules are also important in guiding courts as to the nature of the duties flowing from the professional conduct and may be particularly relevant to professional liability claims, although they are not as useful as might be expected.

At present, as there is no overall professional body governing the practice of mediation, there is no generally accepted code of conduct although there is controversial movement towards this goal. This is the same situation as existed in 1986 when Judy Ryan wrote her article, "The Lawyer as Mediator", in the Canadian Family Law Quarterly. There are now more codes of conduct but we are still a long way from a situation where standards are accepted by the mediation community and it is therefore difficult to set the standards which should be accepted by the courts.

Family Mediation Canada and Academy of Family Mediators

Family Mediation Canada has a long history of attempting to set standards and passed the first Code to govern the conduct of family mediators in Canada in 1986. Recently a new Code has been proposed. Since this code only applies to members of the organization, there is little to assist in trying to set a standard of care, the breach of which would lead to liability apart from any sanction imposed by FMC itself. Similarly in the U.S. the Academy of Family Mediators has its Code. Both the AFM and FMC Codes have moved towards a much more detailed outline of the process, duties and responsibility of the mediator and if followed would make a successful claim very unlikely.

CBAO - ADR Section Proposed Model Code of Conduct

The Canadian Bar Association - Ontario ADR Section, which is the fastest growing section of the CBAO, has recently put forward a draft "Model Code of Conduct for Mediators". The main objectives of this Code are:

(a) to provide guiding principles for mediators' conduct;

(b)to provide a means of protection for the public; and

(c)to promote confidence in mediation as a process for resolving disputes.

The Code imposes duties of impartiality and confidentiality and prohibits the provision of legal advice to the parties. The issue of avoidance of conflict of interest is also addressed and the agreement to mediate is also given prominence. Of significant interest to lawyer-mediators in particular is the provision regarding other conduct obligations which specifies that:

Nothing in this Model Code of Conduct replaces, supercedes or alienates ethical standards which may be imposed or additionally imposed upon any mediator by virtue of the mediator's professional calling.

Similarly, nothing in the model code deals with liability issues nor is there any requirement to carry liability insurance. The draft has been circulated to various dispute resolution organizations for comment.

LAWYERS AS MEDIATORS

An early article commented that from a professional responsibility perspective, there appeared to be four classes of rules which impact on the lawyer as mediator. They are (a) absolute restrictions (2) training (3) independent legal advice and (4) former and future clients. These issues do not seem to have been fully resolved from a Canadian or U.S. perspective and lawyers seem to have a far greater risk of breaching professional rules than being sued by disgruntled parties. As was clearly set out in the article:

The mediation process is designed to minimize the risk of judicial rejection. It is designed to identify and eliminate the circumstances that give rise to charges of undue influence or unconscionability. A competently trained mediator will exercise skills to ensure the parties exhibit individual responsibility and reach a mutually fair decision. If one party exploits another's weaknesses, misuses a fiduciary relationship, uses fraud, deceit, misrepresentation or other wrongful act to gain an advantage or suggests an agreement that is grossly inadequate, it is the duty of the mediator to intervene. The intervention may be the exposure and correction of the problem or it may be the termination of the mediation. The mediator would also have an obligation to inform the parties, whatever action is taken, that any agreement reached in such circumstances would not be enforceable. The mediation process addresses undue influence and unconscionability concerns. Indeed it is a critical element of the process. The risks are less likely to materialize because such concerns are so prominent.

Although these comments were made in the context of a requirement of independent legal advice, they do set out a potential for a higher standard of care for lawyer-mediators, especially in the setting where one party is unrepresented. This has not been a problem but if the mediator is responsible for more than the integrity of the basic process, they there is potential liability arising from a result that one party perceives as unfair where the mediator did not intervene to "balance" the process.

In the US, courts are applying rules regarding lawyers to lawyer mediators especially regarding later representation conflicts which has a potential deterrent effect on lawyer- mediators of strictly enforced conflict.

In Canada, there is a rebuttable presumption of possession of confidential information in case law which although dealing with the movement of lawyer between firms, would apply to the question of later representation by a lawyer-mediator.

Some practitioners believe in the separation of representational lawyers from neutrals and have left law firms to practice ADR. There is also some concern that holding lawyer-mediators to a higher standard would provide unfair competition from non-lawyer mediators.

Some states have placed affirmative duties on lawyers which at a minimum requires the lawyer-mediator to inform the parties to mediation that they do not represent them and may not do so in the future, provide information concerning the mediation process and strongly urge the parties to have independent legal advice if not independent legal representation. A similar type of rule is that of the Law Society of Upper Canada set out below.

Leonard Riskin, in an early article on the topic, stated that the lawyer in mediation should have the duty to assist the participants towards an agreement through a process that meets the parties' own sense of fairness, does not violate minimal societal notions of fairness between persons who make agreements and does not violate minimum standards of fairness toward unrepresented parties.

Another author proposed that lawyers be permitted to act as mediators where the parties are reasonable informed about the mediation process, and the lawyer reasonable believes that

(a)the mediation can be undertaken impartially;

(b)the dispute is suitable for mediation; and

(c)the parties are able to participate effectively and make adequately informed decisions.

It is generally accepted that stricter rules should apply where there are unrepresented parties and the mediator-lawyer must be even more cautious in the provision of mediation services as distinct from legal representation.

As noted above, the Law Society of Upper Canada Rules of Professional Conduct specifically addresses the possibility of lawyers acting as mediators under its Rules of Professional Conduct and in particular under Rule 25 which states that:

Lawyers as Mediators

The lawyer who functions as a mediator must ensure that the parties to the mediation process understand fully that the function being discharged is not part of the traditional practice of law and that the lawyer is not acting as a lawyer for either party. The lawyer as mediator acts to assist the parties to resolve the matters in issue.

COMMENTARY

1. The lawyer-mediator should suggest and encourage the parties to seek the advice of separate counsel before and during the mediation process if they have not already done so.

2. Where in the mediation process the lawyer-mediator prepares a draft contract for the consideration of the respective parties the lawyer-mediator should expressly advise and encourage them to seek independent legal advice concerning the draft contract.

3. The lawyer-mediator must at the outset inform the parties to the mediation that although communications pertaining to and arising out of the mediation process may be covered by some other common law privilege, they will not be covered by the solicitor- client privilege.

4. In acting in the capacity of a mediator the lawyer as a general rule should not give legal advice as opposed to legal information to the parties during the mediation process.

5. As a general rule, neither the lawyer-mediator nor a partner or associate of the lawyer-mediator should render legal representation or give legal advice to either party to the mediation, bearing in mind the provisions of Rule 5 (conflict of interest) and its Commentaries and the common law authorities.

The Toronto ADR project practice direction which was published in 1995 provides for a two year pilot project at the ADR Centre in Toronto. The confidentiality of the proceedings and immunity of neutrals at the ADR Centre is specifically set out in the practice direction along with the suggestion that users of private ADR services may wish to enter into agreements covering the same topics.

The Ottawa ADR practice direction has the following provisions regarding the confidentiality of Proceedings/Immunity of Neutrals

Prior to participating in a mediation session are required to enter into and file with the mediator a confidentiality agreement in Form 3, indicating their agreement that:

(a)statements made and documents produced in a mediation session or in pre-mediation exchanges including statements of issues and appended documents, and not otherwise discoverable, are not subject to disclosure through discovery or any other process and are not admissible into evidence for any purpose, including impeaching credibility;

(b)the notes, record, and recollections of the mediator conducting the mediation session are confidential and protected from disclosure for all purposes; and

(c)the mediator conducting the mediation session has the immunity described in s.82 of the Courts of Justice Act, with necessary changes to points of detail.

At least one private mediator uses similar wording to (c) above in his contract with the parties.

Given that mediation is not limited to the legal profession, there is no reason to say that non- lawyer mediators will not face the same tests regarding liability as lawyers.

Results of the mediation

It is here that the disgruntled client will look to the mediator for compensation. It is also because of the nature of the process that this will be a difficult area to maintain a successful liability claim. Given that the parties craft the settlement and the mediator only manages the process, under most circumstances it will be difficult to place the blame on the process itself although this will happen.

The area where expansion of liability is likely is where the generally accepted model codes are breached regarding the process followed by the mediator and parties.

Standard of Care

It is likely that the most important cause of action will be negligence and that standard of care will not be different in the future and will be that of any other professional and the main defences will be consent of the parties and legal authority.

Substantive Knowledge

Although the theory of mediation appears to stress that it is the process of mediation which matters, there is considerable debate over the issue of the mediator needing to have substantive knowledge of the field in which he or she is mediating. It seems clear, by analogy to the other professionals, that there will be different standards of care imposed on mediators by the courts depending on whether they are mediating in an area of special knowledge or expertise. For example, a family law mediator might be expected to have some basic knowledge of the income tax principles related to family law and a commercial mediator might be expected to have industry or legal knowledge of the subject matter.

REPRESENTED V. NONREPRESENTED PARTIES

As the practice of mediation becomes more widespread, the number of cases involving unrepresented parties or one unrepresented party will continue to increase. It is this area where most difficulties are likely to arise. It will be especially important for the mediator, especially, the lawyer mediator, to make sure that a written agreement is in place concerning the mediation so that confusion over the mediator's role does not arise. The mediator also faces greater risks of liability from both flaws in the process and a party's perception of a flawed result. In dealing with unrepresented parties, the mediator must ensure that the process is fair and that there is no question of the mediator not being a true neutral.

Mediator Immunity

There seems to be general consensus that mediators at least in private practice will face liability claims and although the promotion of mediation may justify some immunity for those involved in court connected mediation, the immunity afforded to judges under the Courts of Justice Act should not be extended to private mediators. In the U.S., at least 42 states have rules of one type or another connected with mediator immunity and/or competence.

Again the contract itself can be used to attempt to limit liability. In the contract referred to above, a specific term is entitled "Waiver of Liability" and confirms the role of the mediator and attempts to have the parties agree not to sue and provide an indemnification.

When attempting to limit or avoid liability and confer immunity from suit, the contract should contain a definition of the mediation process; an explanation of the role of the mediator; fees;

the responsibilities of the parties and the mediator in the process; a definition of what is meant by confidentiality and its limits and a strong recommendation to the parties that they obtain independent legal advice. It has also been suggested that there be a provision to mediate disputes arising from the mediation itself.

CONCLUSIONS

If according to one commentator, we can view the first decade of ADR as one of experimentation and the second as one of implementation, then the third decade will in many ways be one of regulation. In order to properly analyze the impact of regulation on liability, it is necessary to fall back to first principles and decide whose process it is. If it is a process of self determination, then the necessity of detailed objective standards which would be required for a determination of negligence is questionable. If mediation is seen as evaluatative rather than facilitative then standards make more sense and the question of liability becomes much more important.

We are still unclear as to what it means to be a competent mediator and what tools can be used to assess both substantive knowledge and mediation skill. While certification would confer status, the basis of this certification is unclear especially as it seems that experience mediating may to be the most important aspect of qualifications. If the mediation community cannot agree on these basic issues, it is unlikely that the courts will be able to find liability against mediators.

There is a serious question of whose obligation it is to create a trustworthy high quality profession and deal with the issues of liability of not just practitioners but designers of dispute resolution programs. By moving towards standards many will be excluded from the newly emerging profession which may not benefit the users of mediation. There would appear to be little demonstrated link between competence as a mediator and the codes.

Despite this, there is significant potential for claims against mediators and it is likely as the concept of mediators as a separate profession evolves, at the same time, the development of standards will make successful claims more likely. In reality, the situation is not much different then it was in 1986-87 when Chaykin commented that liability claims against mediators would be difficult and usually unsuccessful. The best protection against a successful suit lies in having a written contract and encouraging clients to obtain independent legal advice during the process and having liability insurance the terms of which may require a written agreement in any event. The insurance must include coverage for the costs of defending the claim for although the chances of a successful claim are low, the chances of a potential claim is real. As set out in a pamphlet from a leading U.S. insurer of mediators:

Our overall experience has been that most claims filed against mediators have been successfully defended. Nevertheless, mounting a defence against even the most frivolous claim can be expensive. Because of the potential for a mediator malpractice suit, mediators should consider protecting themselves with malpractice insurance. As the mediation process is used more frequently, both on a voluntary and court mandated basis, it is reasonable to assume that malpractice filings against mediators will correspondingly become more frequent.

As Folberg commented in 1988, the imposition of legal liability for mediators is a question of balancing public policies which favour the resolution of private disputes against the policy of holding professionals accountable and providing a remedy for the parties to mediation. Given that there are at least three possible areas of protection from liability for mediators, there would appear to be little reason to extend immunity. At the same time it is important for judges to fully understand the role of the mediator's and the extent of his or her responsibilities so that unreasonable standards are not imposed by the courts.

Overall, as long as mediators focus on the process of mediation, remain facilitative and avoid the temptation to evaluate or adjudicate, the potential liability issue is not significant and can easily be insured against at reasonable cost.

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