Summary

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Summary

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Evidence — Admissibility — Civil procedure — Mediation — General principle of confidentiality of mediation and specific confidentiality agreement — Whether privilege of confidentiality ceases to apply where one party alleges existence of transaction — Suit by business against supplier — Mediation followed by disagreement on outcome of mediation — Motion to homologate transaction containing allegations related to mediation — Motion to strike allegations — Whether Court of Appeal erred in law in holding that exception proposed by authors to principle of confidentiality of mediation prevails over clause of strict confidentiality signed by parties — Whether facts related to mediation can be tendered to prove alleged transaction — Whether writing necessary to prove alleged transaction.

Disputes arose between the parties, both in Quebec and in the United States, regarding jet-ski gas tanks: Bombardier claimed that the tanks, supplied by Union Carbide, were unfit for normal use. A mediation agreement prepared by mediator Mendelsohn was signed on April 26, 2011. It contained the following clause regarding the confidentiality of the process: “Nothing which transpires in the Mediation will be alleged, referred to or sought to be put into evidence in any proceeding”. An offer was made at the mediation session held the next day in Montréal. On May 17, Bombardier’s lawyer accepted the offer of $7M. On May 19, Union Carbide’s lawyer stressed that this was a global settlement. On June 6, Bombardier stated that, on the contrary, it was limited to the Quebec dispute. In July 2011, Bombardier filed a motion in the Superior Court to homologate the transaction in the dispute. The applicants applied to strike six allegations from the motion on the ground that they referred to the mediation.

Lower Court Rulings