X (a pseudonym) v Y (a pseudonym) - [2022] WADC 85

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION:   PERTH
CITATION:   X (a pseudonym) -v- Y (a pseudonym) [2022] WADC 85
CORAM:   SWEENEY DCJ
HEARD:   28 FEBRUARY 2022
DELIVERED          :   8 SEPTEMBER 2022
FILE NO/S:   [Suppressed]
BETWEEN:   X (a pseudonym)
Plaintiff
AND
Y (a pseudonym)
First Defendant
Z (a pseudonym)
Second Defendant

Catchwords:

Section 71 of the Supreme Court Act 1935 (WA) - Inadmissibility of offer made during mediation - Confidentiality of offer made in mediation - Without prejudice privilege - Waiver - Consent

Legislation:

Nil

Result:

Preliminary issue determined in favour of defendants.
Evidence ruled inadmissible and statement of claim and schedule of damages to be substituted.

Representation:

Counsel:

Plaintiff	:	In Person
First Defendant	:	Mr G D Cobby SC
Second Defendant	:	Mr G D Cobby SC

Solicitors:

Plaintiff	:	Not applicable
First Defendant	:	MDS Legal
Second Defendant	:	MDS Legal

Case(s) referred to in decision(s):

Avonwick Holdings Ltd v Webinvest Ltd [2014] EWCA Civ 1436
B v Auckland District Law Society [2003] 2 AC 736
Biala Pty Ltd v Mallina Holdings Ltd [1990] WAR 174
Bourns Inc v Raychem Corp [1999] 3 All ER 154
Briggs v Clay [2019] EWHC 102
C v M [2011] WASC 175
Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner [2019] FCAFC 201; (2019) 272 FCR 290
Cutts v Head [1984] Ch 290
Eurasian Natural Resources Corporation Ltd v Dechert LLP [2016] EWCA Civ 375; [2016] 1 WLR 5027
Federal Commissioner of Taxation v Consolidated Media Holdings Pty Ltd [2012] HCA 55; (2012) 250 CLR 503
Federal Commissioner of Taxation v Jayasinghe [2016] FCAFC 79; (2016) 247 FCR 40
Hyde v Wrench (1840) 49 ER 132
Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1
Masters v Cameron (1954) 91 CLR 353
Minister for Immigration and Citizenship v SZJGV (2009) 238 CLR 642
Muller v Linsley & Mortimer [1994] EWCA Civ 39; [1996] PNLR 74
Naso v Danehill Nominees Pty Ltd [2006] WASC 265
Ofulue v Bossert [2009] UKHL 16; [2009] 1 AC 990
Old Papa's Franchise Systems Pty Ltd v Camisa Nominees Pty Ltd [2003] WASCA 11
Pihiga v Roche [2011] FCA 240
Pinto v Kinkela [2003] WASC 126
Rush & Tompkins Ltd v Greater London Council [1989] AC 1280
State of Western Australia v Southern Equities Corporation Ltd (in liq) (1996) ALR 597
SZTAL v Minister for Immigration and Border Protection [2017] HCA 34
Unilever PLC v The Procter & Gamble Co [2000] 1 WLR 2436
Western Areas Exploration Pty Ltd v Streeter [No 2] [2009] WASCA 15
Yokogawa Aust Pty Ltd v Alstom Power Ltd [2009] SASC 377
YXW Pty Ltd v Sushi Sushi Franchising Pty Ltd [2016] VSC 538; (2016) 52 VR 182

SWEENEY DCJ:

Introduction

Section 71 of the Supreme Court Act 1935 (WA) provides that evidence of anything said or done, any communication and any admission made in the course of, or for the purposes of, an attempt at settlement of a case by way of court‑ordered mediation is inadmissible in any proceedings and, further, that any document prepared in the course of, or for the purposes of, an attempt to settle a case by way of court‑ordered mediation is confidential. There are several express exceptions. A party wishing to use such evidence to advance a case of professional negligence against the lawyer who represented him or her during the mediation is not amongst them.
The plaintiff's case against the defendants, her former lawyers, for alleged professional negligence, depends upon evidence of matters that occurred in court-directed mediation in earlier Supreme Court proceedings against different defendants. To avoid confusion with those defendants in the Supreme Court proceedings, I will refer to the defendants in the matter before this court as the plaintiff's 'former lawyers'. Her former lawyers object to all such evidence and the pleadings that refer to it.
This court ordered that a preliminary issue be determined prior to trial, to determine whether s 71 renders inadmissible any evidence of multiple facts pleaded in the statement of claim and objected to by her former lawyers in their Schedule A. The short answer to the question to be determined is 'yes'. Further, the statement of claim, schedule of damages, and aspects of the material filed in support by the plaintiff for the determination of the preliminary issue all breach s 71(1). These are my reasons for so deciding.

Dealing with confidential matters in these reasons

The first challenge was to determine how to approach this judgment, in which some reference necessarily has to be made to things said and done during mediation, which are confidential. Different judges have taken different approaches to the issue: in C v M [2011] WASC 175, Kenneth Martin J anonymised the parties' names, suppressed the case number to the general public, and gave a 'broad and sanitised summary' to ensure that no confidential material came before the eventual trial judge. By contrast, in Naso v Danehill Nominees Pty Ltd [2006] WASC 265, Martin CJ stated: 'I will not compound the breach of s 71 by repeating what was in the affidavit material, other than to say that its general tenor was …', giving reasons for decision in general terms that did not require disclosure of confidential material. Another approach might be to annex a document setting out the confidential factual issues, and suppress its contents, but that approach in this case was likely to be convoluted.
It is essential to provide the barest detail, but even that bare detail is confidential. Not much detail is required, because the broad principle is the same irrespective of the fine details of the case, but it is impossible to explain the case without revealing at least something of what was said and done in and around mediation. I have adopted the approach of anonymizing the parties and suppressing the case number from availability to the general public, as well as sanitising the facts of identifying detail. Some extra protection is afforded because the mediation took place in entirely different proceedings in the Supreme Court, with the plaintiff the only party in common.

Very broad factual situation

Moving on then to the broad facts, the plaintiff is suing her former lawyers (the law firm and individual lawyer) for alleged professional negligence. They acted for the plaintiff in relation to previous litigation (in which she was also the plaintiff) conducted in the Supreme Court concerning the interpretation of a will (and a second action, involving three of the same defendants to the first action). The first action was referred to mediation before a registrar. Towards the end of that mediation conference, a handwritten offer to settle was made to the plaintiff by all of the defendants in that dispute, by way of payment of a certain sum. The offer was expressed to be open for two days only. No time for the payment to be made was specified in the written offer although, according to the plaintiff, the author of that handwritten note, the lawyer for the executor, had mentioned a likely timeframe in discussions. The offer was subject to the parties entering into a deed setting out the terms as per the handwritten offer.
After the mediation conference was over, the plaintiff wished to accept the offered sum, but wanted a clear time for payment to be specified, which her former lawyer (on her instructions) communicated to the defendants in writing, specifying a date for payment and also proposing an exchange of a bank cheque for a minute of consent orders discontinuing both actions. The defendants then effectively went quiet. In time, it emerged that the defendants had regarded that response as having amounted to a counter‑offer, which rejected their offer: Hyde v Wrench (1840) 49 ER 132.
The plaintiff complains that her former lawyer knew she wanted to accept the offer unconditionally - except that she 'merely wanted to clarify the date by which her money would be provided to her' - and negligently failed to word the acceptance of the offer such that it could not be characterised as a counter‑offer, a concept the plaintiff was then ignorant of. The plaintiff pleads that she relies upon the authority of Masters v Cameron (1954) 91 CLR 353 to advance her case that she merely wanted to clarify the date the money would be paid. That case does not appear to be on point; it is no part of this judgment, however, to assess the merits of the plaintiff's case against her former lawyers.
The Supreme Court matter did not settle, the matter was heard by way of directions as to the construction of the will, and that construction went against plaintiff. As a result, she received a distribution from the estate which was substantially less than that which had been on offer during mediation. She now claims damages against her former lawyers on the basis, in essence, of the difference between the offer made in mediation, which she could have accepted, and the lesser sum she ultimately obtained. Her schedule of damages makes that plain. That is not her only complaint in the current action, but it is her most substantial claim.
There is no material before the court indicating that the parties in the Supreme Court proceedings have given their consent to the admission of the offer in these proceedings, and the plaintiff made it plain in oral submissions that there is animosity involved and that they have not provided consent.

The legislation

Section 71 provides:
71. Privilege
(1)Subject to subsection (3), evidence of -
(a)anything said or done; or
(b)any communication, whether oral or in writing; or
(c)any admission made,
in the course of or for the purposes of an attempt to settle a proceeding by mediation under direction is to be taken to be in confidence and is not admissible in any proceedings before any court, tribunal or body.
(2)Subject to subsection (3) -
(a)any document prepared in the course of or for the purposes of an attempt to settle a proceeding by mediation under direction; or
(b)any copy of such a document; or
(c)evidence of any such document,
is to be taken to be subject to a duty of confidence and is not admissible in any proceedings before any court, tribunal or body.
(3)Subsections (1) and (2) do not affect the admissibility of any evidence or document in proceedings if -
(a)the parties to the mediation consent to the admission of the evidence or document in the proceedings; or
(b)there is a dispute in the proceedings as to whether or not the parties to the mediation entered into a binding agreement settling all or any of their differences and the evidence or document is relevant to that issue; or
(c)the proceedings relate to a costs application and, under the rules of court, the evidence or document is admissible for the purposes of determining any question of costs; or
(d)the proceedings relate to any act or omission in connection with which a disclosure has been made under section 72(2)(c).
(4)A mediator cannot be compelled to give evidence of anything referred to in subsection (1) or (2) or to produce a document or a copy of a document referred to in subsection (2) except -
(a)in proceedings referred to in subsection (3)(d); or
(b)in proceedings relating to a costs application where there is a dispute as to a fact stated or a conclusion reached in a mediator's report prepared under the rules of court on the failure of a party to cooperate in the mediation and the evidence or document is relevant to that issue.
(5)In subsections (3) and (4) -
costs application means an application for the costs of the mediation or of the proceedings to which mediation relates.
'Mediation under direction' is defined in s 69 to mean 'mediation carried out by a mediator under a direction of the Court under and subject to the rules of court'. 'Mediator' is defined as:
(a)a registrar appointed by the Chief Justice to be a mediation registrar under the rules of court; or
(b)a person approved by the Chief Justice to be a mediator under the rules of court; or
(c)a person agreed by the parties.
The exception in s 71(3)(c) is complemented with s 167(1)(q), which provides that the judges of the Supreme Court may make rules of court enabling and regulating the mediation of matters, including 'the admissibility of evidence in relation to a mediation for the purpose of determining the costs of the mediation or the costs of the proceedings between the parties to the mediation'.
Section 72 is not directly relevant to the facts of this case but is relevant to the interpretation of s 71 as part of the overall legislative scheme. It provides:
72. Confidentiality
(1)Subject to subsection (2), a mediator must not disclose any information obtained in the course of or for the purpose of carrying out mediation under direction.
(2)Subsection (1) does not apply if -
(a)the disclosure is made for the purpose of reporting under the rules of court on any failure of a party to cooperate in a mediation; or
(b)the disclosure is made with the consent of the parties; or
(c)there are reasonable grounds to believe that the disclosure is necessary to prevent or minimize the danger of injury to any person or damage to any property; or
(d)the disclosure is authorised by law or the disclosure is required by or under a law of the State (other than a requirement imposed by a subpoena or other compulsory process) or the Commonwealth.
Despite the heading, s 72 clearly does not define the duty of confidentiality created by s 71(2) which applies to all, and not just mediators.

Plaintiff's submissions as to the interpretation of s 71

The plaintiff argues, however, that a literal interpretation of s 71 is not in keeping with the purpose underlying the law, and that the court should prefer an interpretation which finds that s 71 has no application to client/solicitor communications, and does not have the effect of protecting a lawyer from a claim in negligence.
The plaintiff submits that the court ought to draw the underlying purpose of s 71 from the common law 'without prejudice' privilege, relying upon the decisions of the Court of Appeal (in England) in Muller v Linsley& Mortimer [1994] EWCA Civ 39; [1996] PNLR 74 and Unilever PLC v The Procter & Gamble Co [2000] 1 WLR 2436. She submits that s 71 was never intended to protect a lawyer from an action for negligence and that, if a party is prevented from leading evidence of facts which are necessary to prove a claim of professional negligence relating to advice given or conduct during mediation, the public's confidence in the mediation process will be undermined.
She therefore argues that an interpretation of s 71 should be favoured which does not extend to client/solicitor communications. (Of course, her main complaint does not centre around a client/solicitor communication but, rather, her former lawyers' response to the offer made in mediation). The plaintiff contends that the failure of Parliament to include in s 71(3) an express exception enabling evidence to be led where it relates only to an action for professional negligence arising out of the handling of negotiations in mediation indicates that it did not occur to Parliament that a lawyer would seek to hide behind s 71 to escape liability, and therefore this court should imply such an exception.
Further, the plaintiff submits that, in any event, the communications between her and her lawyer occurred after the mediation conference, and therefore do not fall within the prohibition in s 71.
To do justice to her argument, it is necessary to consider the scope of without prejudice privilege at common law, before comparing that to the text of s 71.

Without prejudice privilege at common law

In 1957, our High Court considered the scope of the common law without prejudice privilege in the case of Field v Commissioner for Railways for New South Wales [1957] HCA 92; (1957) 99 CLR 285 (291) ‑ (292):
The law relating to communications without prejudice is of course familiar. As a matter of policy the law has long excluded from evidence admissions by words or conduct made by parties in the course of negotiations to settle litigation. The purpose is to enable parties engaged in an attempt to compromise litigation to communicate with one another freely and without the embarrassment which the liability of their communications to be put in evidence subsequently might impose upon them. The law relieves them of this embarrassment so that their negotiations to avoid litigation or to settle it may go on unhampered. This form of privilege, however, is directed against the admission in evidence of express or implied admissions. It covers admissions by words or conduct. For example, neither party can use the readiness of the other to negotiate as an implied admission. It is not concerned with objective facts which may be ascertained during the course of negotiations. These may be proved by direct evidence. But it is concerned with the use of the negotiations or what is said in the course of them as evidence by way of admission. For some centuries almost it has been recognised that parties may properly give definition to the occasions when they are communicating in this manner by the use of the words 'without prejudice' and to some extent the area of protection may be enlarged by the tacit acceptance by one side of the use by the other side of these words.
In determining whether a particular admission in that case by a plaintiff to a doctor retained by the defendant was admissible, the court commented (292) - (293):
The question, however, does not depend altogether upon the expectations of the parties. It depends upon what formed part of the negotiations for the settlement of the action and what was reasonably incidental thereto. …
On the whole the conclusion of the Supreme Court that the plaintiff's admission fell outside the area of protection must command assent as correct. It was not reasonably incidental to the negotiations that such an admission should be protected. It was made without any proper connexion with any purpose connected with the settlement of the action.
In Western Australia, McLure J in Old Papa's Franchise Systems Pty Ltd v Camisa Nominees Pty Ltd [2003] WASCA 11 [91] - [95] summarised without prejudice privilege as follows:
91Statements made without prejudice in an attempt to settle a dispute or action are privileged. Without prejudice privilege is a joint privilege and thus cannot be waived without the consent of the negotiating parties. The mere fact that a document is or is not marked 'without prejudice' is not decisive. The test is whether the communication was part of a genuine attempt to settle a dispute: Rodgers v Rodgers (1964) 114 CLR 608 at 614. If so, the whole course of the negotiations is privileged: South Shropshire District Council v Amos [1987] 1 All ER 340.
92A binding contract brought into existence as a result of without prejudice negotiations is not protected by the privilege. Although the resulting contract is not privileged, the negotiations leading to the agreement remain privileged: Biala Pty Ltd v Mallina Holdings Ltd(1990) WAR 174 at 180; Bentley v Nelson [1963] WAR 89 at 93.
93However, without prejudice negotiations leading to an agreement can be considered where there is a dispute as to whether or not an agreement to settle was made: Tomlin v Standard Telephones & Cables Ltd [1969] 1 WLR 1378; Unilever P/C v Proctor & Gamble Co [2000] 1 WLR 2436 at 2444.
94The authorities establish that the without prejudice rule is not absolute and resort may be had to without prejudice material for a variety of reasons when the justice of the case requires it: Rush & Tompkins Ltd v Greater London Council [1989] AC 12870 per Lord Griffiths at 1300.
95Thus, without prejudice negotiations may be 'pleaded into evidence' in such a way that the privilege is no longer available, by analogy with the rule concerning legal professional privilege: Western Australia v Southern Equities Corp Ltd (in liq) (1996) 142 ALR 597 at 601-602. The principal is not confined to the case where the party seeking to assert privilege raises a positive case: Data Access Corp v Powerflex Services Pty Ltd (1994) AIPC 91‑112.

Turning to the cases relied upon by the plaintiff, Muller v Linsley concerned an action on the part of the Mullers against their former lawyer for professional negligence in failing to arrange for the stamping of a transfer of shares from husband to wife before that transfer was submitted to the Board of the company seeking to oust him as director. The transfer was an attempt to put those shares out of reach of the Board before he was obliged to sell his shares to other members. The Board rejected the unstamped transfer and forced him to sell his shares and Muller's subsequent action against the company resulted in him receiving a substantial settlement. As against his former lawyer, Muller pleaded that he had acted reasonably in mitigating his loss caused by the company, and disclosed the settlement itself, but resisted the lawyer's request for discovery of the documentation leading to the settlement, on the basis that such documentation was all part of without prejudice negotiations.
Hoffmann LJ referred to the decisions of Cutts v Head [1984] Ch 290 and Rush & Tompkins Ltd v Greater London Council [1989] AC 1280, the latter being a case in which the House of Lords had upheld a claim to privilege of without prejudice negotiations resulting in a settlement when the details underlying the settlement were sought by a third party in related proceedings. Hoffmann LJ concluded that Cutts v Head showed that the rule protecting without prejudice negotiations has two justifications: firstly, the public policy of encouraging parties to negotiate and settle their disputes, in which the parties should not be discouraged by the knowledge that anything said may be used to their prejudice as admissions of liability in the proceedings; secondly, an implied agreement arising out of what is commonly understood to be the consequences of negotiating on a without prejudice basis. He said the latter was the only justification for maintaining the privilege at the costs stage when a matter has already settled, although such an implication could be expressly excluded by a contrary statement such as in a Calderbank offer in which the right to tender the offer as to the issue of costs is expressly reserved.
Hoffmann LJ continued (79) - (80):
If one analyses the relationship between the without prejudice rule and the other rules of evidence, it seems to me that the privilege operates as an exception to the general rule on admissions (which can itself be regarded as an exception to the rule against hearsay) that the statement or conduct of a party is always admissible against him to prove any fact which is thereby expressly or impliedly asserted or admitted. The public policy aspect of the rule is not in my judgment concerned with the admissibility of statements which are relevant otherwise than as admissions, ie independently of the truth of the facts alleged to have been admitted.
Many of the alleged exceptions to the rule will be found on analysis to be cases in which the relevance of the communication lies not in the truth of any fact which it asserts or admits, but simply in the fact that it was made. Thus, when the issue is whether without prejudice letters have resulted in an agreed settlement, the correspondence is admissible because the relevance of the letters has nothing to do with the truth of any facts which the writers may have expressly or impliedly admitted. They are relevant because they contain the offer and acceptance forming a contract which has replaced the cause of action previously in dispute. Likewise, a without prejudice letter containing a threat is admissible to prove that the threat was made … Indeed, I think that the only case in which the rule has been held to preclude the use of without prejudice communications, otherwise than as admissions, is in the rule that an offer may not be used on the question of costs; a rule which, as I have said, has been held to rest purely upon convention and not upon public policy.
Hoffmann LJ found that, the issue being whether Muller had acted reasonably in mitigation of his loss, the documentation leading to his settlement with the company was not protected by the privilege, because its relevance did not lie in establishing the truth or otherwise of any admission made. Swinton‑Thomas LJ and Leggatt LJ, in separate judgments, agreed with Hoffmann LJ but also concluded that, as Muller had brought the reasonableness of his conduct into issue, he had waived any privilege attached to the negotiations.
In Yokogawa Aust Pty Ltd v Alstom Power Ltd [2009] SASC 377, Muller v Linsley was regarded as authority for the proposition that the unilateral actions of one party to without prejudice negotiations can impliedly waive privilege in litigation involving a third party: Yokogawa Aust Pty Ltd v Alstom Power Ltd [96] (Duggan J with whom Sulan & Kourakis JJ agreed). Muller v Linsley, however, has been criticised in England. In Briggs v Clay [2019] EWHC 102, the High Court (Fancourt J) said of the judgments of Swinton Thomas and Leggatt JJ [52]:
There has also been judicial disagreement with the basis for the decision preferred by Swinton Thomas and Leggatt JJ. The privilege conferred by the without prejudice rule cannot be waived unilaterally by one party only to the negotiations, in the way that the sole owner of legal professional privilege can waive the privilege. There was no suggestion in Muller that the shareholders had expressly or impliedly agreed to give up their privilege. Accordingly, waiver, in its true sense - voluntarily giving up privilege that exists and is protected by the without prejudice rule - could not have arisen.
No attention was given in Muller v Linsley to whether the company which had earlier settled its dispute with Muller would have been embarrassed or prejudiced by the subsequent access to those negotiations. In Village/Nine Network v Mercantile Mutual [1999] QCA 276, the Queensland Court of Appeal placed some emphasis on this consideration, Pincus JA stating at [20]:
There is no sound basis for holding that the basic purpose of protecting negotiations is sufficiently served if one allows the negotiators to be exposed to the risk that what they privately say, to settle their disputes, may be broadcast to the world at the instance of any party who can make use of it in litigation, unless that person is a party to the dispute being negotiated.
In Unilever PLC v The Procter & Gamble Co, the second case relied upon by the plaintiff, Robert Walker LJ commended Hoffmann LJ's analysis of the privilege in Muller v Linsley, however adding (2443):
Without in any way underestimating the need for proper analysis of the rule, I have no doubt that busy practitioners are acting prudently in making the general working assumption that the rule, if not 'sacred', has a wide and compelling effect. (citations removed)
Nevertheless, Walker LJ noted that there are numerous occasions on which, despite without prejudice negotiations, the without prejudice rule did not prevent admissibility of statements or documents, listing eight categories of 'the most important' exceptions (2444) - (2445), including where the issue is whether a concluded settlement agreement was reached, whether an agreement reached during negotiation should be set aside on the grounds of misrepresentation, fraud or undue influence, where a statement in negotiations is said to give rise to an estoppel, where a party has put into issue whether he acted reasonably in mitigating his loss in accepting a settlement offer (based on Muller v Linsley), where an offer is expressly made 'without prejudice except as to costs', and where excluding the evidence would act as a cloak for perjury, blackmail or other 'unambiguous impropriety' where the privileged occasion has been unequivocally abused. The plaintiff in written submissions rather latched on to that expression 'unambiguous impropriety' - more of that later. Notably, the list did not include an exception where the without prejudice statement was sought to be led other than as an admission, which was the primary reason why Hoffmann LJ, in Muller v Linsley, ruled the evidence admissible.
Walker LJ found that (2448) - (2449):
Whatever difficulties there are in a complete reconciliation of those cases, they make clear that the without prejudice rule is founded partly in public policy and partly in the agreement of the parties. They show that the protection of admissions against interest is the most important practical effect of the rule. But to dissect out identifiable admissions and withhold protection from the rest of without prejudice communications (except for a special reason) would not only create huge practical difficulties but would be contrary to the underlying objective of giving protection to the parties, in the words of Lord Griffiths in the Rush v Tompkins case at p1300: 'to speak freely about all issues in the litigation both factual and legal when seeking compromise and, for the purpose of establishing a basis of compromise, admitting certain facts'. Parties cannot speak freely at a without prejudice meeting if they must constantly monitor every sentence, with lawyers or patent agents sitting at their shoulders as minders.
His Lordship found that it would be an abuse of process to allow the appellant to plead anything said during a without prejudice meeting and said to constitute a threat to institute proceedings for breach of a patent, because the meeting was undoubtedly an occasion covered by the normal rule based on public policy, there was nothing to suggest that the respondent's representatives had acted in a way that was oppressive or dishonest, and the circumstances were such that each side was entitled to expect to be able to speak freely.
In Briggs v Clay, Fancourt J said of Unilever PLC v The Proctor & Gamble Co, at [58]:
That case therefore marks the start of the retreat from the notion that only admissions are protected by the without prejudice rule. The public policy underlying the rule necessitates a wider application and would be undermined by seeking to remove parts only of the communications in the nature of admissions from the rest of the text. The Unilever case does not in terms recognise as a general exception to the rule reliance on privileged communications to prove the fact that is independent of the truth of what is said. However, the list of exceptions does include a number of cases in which that is what in substance is being done.
Of Muller v Linsley, Fancourt J commented that Hoffmann LJ's decision was made on two bases: the first being that the without prejudice rule protects admissions and therefore does not protect communications sought to be led not for the truth of the communication but for the fact of it, and that the second basis was that the plaintiff himself had pleaded the reasonableness of his negotiations, thereby pleading that matter into issue and that it could not be determined without disclosure of the content of the negotiations. Fancourt J continued [51]:
The decision in the Muller case has given rise to considerable comment in later cases and still generates controversy today. Insofar as the judgement of Hoffmann LJ rests on the first basis identified above, it has been substantially discredited in later cases, both as to the rule only applying to protect admissions and as to there being any general exception to the rule when negotiations are relied upon to establish a 'collateral fact'. The true ratio of the second basis for the decision is controversial. A narrow interpretation would be to say that it is a decision based on its own facts, or limited to a case where the issue is the reasonableness of a negotiated settlement, but no judge subsequently considering the case has said so.
Fancourt J further referred to the decision of the House of Lords in Ofulue v Bossert [2009] UKHL 16; [2009] 1 AC 990, concluding [60] that the decision:
offers no support for the proposition that there is a general exception to the without prejudice rule where a without prejudice statement is being relied on to prove something other than the truth of the statement made or something unconnected to the issues in the case. On the contrary, the general tenor of the speeches is that exceptions to the rule should be strictly limited, in order to uphold the policy underlying the rule.
Fancourt J concluded of the result in Muller v Linsley [53]:
Despite the criticism of the building blocks of the three judgements in Muller, it is generally accepted to have been rightly decided, as an exception to the without prejudice rule. The difficulty lies in deciding the true ratio of the decision and the extent of the exception thereby established.
In Avonwick Holdings Ltd v Webinvest Ltd [2014] EWCA Civ 1436, Lewison LJ [21] - [22] observed of Muller v Linsley:
Mr Berry says that he is not seeking to rely on admissions made in the course of negotiations and that if he is not seeking to rely on admissions, then the decision in Muller v Linsley & Mortimer requires disclosure.
That was a case in which the plaintiff asserted that a settlement that he had made was a reasonable settlement and the defendant asserted that it was not. The reasonableness of the settlement was therefore directly in issue and it was the plaintiff who had put it in issue. It is hardly surprising that in those circumstances the court ordered disclosure of the negotiations leading to the settlement. The general rule however is still that stated in Rush & Tompkins Ltd v Greater London Council & Another, namely that without prejudice negotiations once privileged remain privileged even after settlement. Moreover, Hoffmann LJ's reasoning in Muller which distinguished between an admission and other statements was disapproved by The House of Lords in Ofulue … (citations removed).
It appears then that the decision arrived at in Muller v Linsley been accepted by the House of Lords and the High Court (of England and Wales) as having been correct as to its outcome, while the rationale has been doubted. It appears that there is no recognised exception for evidence of a statement sought to be led, not for the truth of the statement, but for the fact of it. Where, however, the party resisting the admissibility of negotiations has put the reasonableness of the negotiations or settlement into issue, or perhaps in some other way pleaded the negotiations into relevance, an exception may be made.
The decisions in Unilever PLC v The Procter & Gamble Co and decisions referred to therein of Rush & Tompkins Ltd v Greater London Council, and Cutts v Head have been referred to in multiple Australian decisions and form part of the body of law in this State in relation to the scope of the without prejudice privilege at common law.
The plaintiff in this case does not wish to use the offer made by the defendants to the Supreme Court proceedings as an admission against them, that matter having now been concluded but, rather, for the fact that the offer was made and for the fact of the contents, because it is the plaintiff's former lawyer's advice about and written response to that offer that is the basis of claim that the lawyers were negligent and, second, it is the sum offered in the Supreme Court matter, and the difference between it and what the plaintiff eventually achieved, that forms the substantial basis of the claim for damages. Similarly, the counter‑offer is not relied upon, by the plaintiff at least, for the truth of its contents, but for the fact of its contents, because the plaintiff's case is that the form of the letter negligently exposed her to its characterisation as a counter‑offer, such that she could then no longer purport to accept the defendants' offer made in mediation. Although the former lawyer's response to the offer was marked 'without prejudice save as to costs' the party obviously being protected by that limitation on the document was not the lawyer who drafted the document, but the plaintiff. And, of course, both the plaintiff and her former lawyers are already privy to the contents of both documents. This is not a case in which the plaintiff wishes to disclose a confidential document to a party who was not privy to the negotiations - except, of course, the trial judge. As to that, however, this is not a situation in which the trial judge may be unconsciously influenced by the knowledge of admissions made and a sum offered during pre‑trial negotiations. The offer and response related to different proceedings and different issues.
Nevertheless, the position as to admissibility at common law is by no means clear. I am not satisfied there is an exception of admissibility simply because the party seeking to use the document does not seek to rely upon the truth of it but, rather, the fact of it. Nor does the plaintiff fall within the Muller v Linsley exception which has received acceptance in English decisions as arising from the party seeking to resist disclosure having pleaded the without prejudice negotiations as relevant to a matter in issue. Nor am I satisfied that one party can unilaterally waive the privilege. There is no doubt that the privileged communications are critical to the plaintiff's case but that circumstance of itself, without some additional factor, is not an exception that is clearly spelt out in the authorities that I have been referred to or come across.
I mentioned earlier that the plaintiff had latched on to the expression 'unambiguous impropriety' employed by Walker LJ in Unilever PLC v The Procter & Gamble Co, as one of the several exceptions to the privilege, namely where excluding the evidence would act as a cloak for perjury, blackmail or other 'unambiguous impropriety' where the privileged occasion has been unequivocally abused. The plaintiff sought to advance in written submissions the proposition that her former lawyers had in some way used the negotiations for an improper purpose, or been guilty of some impropriety.
The statement of claim pleads opinions and conjecture about various matters, and the plaintiff complains of inadequate and/or inconsistent communications with her on the part of her former lawyers, and potential overcharging, but there was no foundation laid for any suggestion that the mediation conference, or the offer made by the defendants in those proceedings, or her former lawyer's response to the offer, or advice given or not given concerning the offer made in mediation and the intended response, amounted to an abuse of the privileged occasion, or that excluding the evidence would act as a cloak for perjury, blackmail or other unambiguous impropriety. I disregard that exception as a potential basis for the admission of the evidence as having no factual or legal foundation in this case.
The plaintiff's argument that I should interpret s 71 so as to be consistent with the scope of the common law privilege faced significant hurdles in any event but, while it is not necessary to reach a concluded view on the question, it is not clear to me that the offer and counter‑offer would have been admissible at common law.
But if they would have been admissible at common law, the insurmountable hurdle for the plaintiff is s 71. It is common ground that the offer from the defendants was made during court‑ordered mediation. Section 71 therefore applies according to its terms. The plaintiff does not have the consent of the parties to that mediation to disclose what was said and done in mediation. Her submissions rest either upon the presumption that s 71 meant to restate the common law privilege accorded to without prejudice negotiations, along with its limitations or exceptions depending upon how the rule is analysed, and nothing more, or that this court is empowered in legislating to recognise exceptions to s 71 that are not contained in the section, because the justice of her case demands it. I turn now to the interpretation of s 71.

Principles of statutory interpretation

Section 18 of the Interpretation Act 1984 (WA) provides:
18. Purpose or object of written law, use of in interpretation
In the interpretation of a provision of a written law, a construction that would promote the purpose or object underlying the written law (whether that purpose or object is expressly stated in the written law or not) shall be preferred to a construction that would not promote that purpose or object.
Further, as to the use of extrinsic sources to aid in interpretation, s 19 provides:
19. Extrinsic material, use of in interpretation
(1)Subject to subsection (3), in the interpretation of a provision of a written law, if any material not forming part of the written law is capable of assisting in the ascertainment of the meaning of the provision, consideration may be given to that material -
(a)to confirm that the meaning of the provision is the ordinary meaning conveyed by the text of the provision taking into account its context in the written law and the purpose or object underlying the written law; or
(b)to determine the meaning of the provision when -
(i)the provision is ambiguous or obscure; or
(ii)the ordinary meaning conveyed by the text of the provision taking into account its context in the written law and the purpose or object underlying the written law leads to a result that is manifestly absurd or is unreasonable.
The consideration of the extrinsic materials is not limited to situations where the text is ambiguous or obscure as contemplated by subsection (b), given the broader context of subsection (a). Section 19(2) lists specific sources to which regard may be had, including the Second Reading Speech. Section 19(3) provides that, in determining what extrinsic materials to consider and what weight to attribute to them, regard 'shall be had' to the 'desirability of persons being able to rely on the ordinary meaning conveyed by the text', taking into account its context in the written law and the purpose or object underlying the written law.
There is no relevant material difference between the provisions of s 19 of the Interpretation Act 1984 (WA) and the general principles of statutory construction. In Federal Commissioner of Taxation v Consolidated Media Holdings Pty Ltd [2012] HCA 55; (2012) 250 CLR 503 the High Court stated [39]:
'This Court has stated on many occasions that the task of statutory construction must begin with a consideration of the [statutory] text'. So must the task of statutory construction end. The statutory text must be considered in its context. That context includes legislative history and extrinsic materials. Understanding context has utility if, and in so far as, it assists in fixing the meaning of the statutory text. Legislative history and extrinsic materials cannot displace the meaning of the statutory text. Nor is their examination an end in itself.
(footnotes omitted).
In Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner [2019] FCAFC 201; (2019) 272 FCR 290 (15 November 2019) (Bromberg, Wheelahan & Snaden JJ), after referring to Federal Commissioner of Taxation v Consolidated Media Holdings Ltd, the court stated [25]:
It is an error to substitute for the text of … (the statute under consideration) … judicial formulations of cognate principles in common law or other statutory contexts. Courts have warned against this often enough. A similar type of error is to approach the interpretation of a statutory provision with a preconceived idea as to the purpose to be achieved by the provision without focusing on the statutory text that has been deployed.
(citations omitted).
The text of the statute need not be ambiguous before it is permissible to consider the context of the statute as well as its purpose or object, in order to ascertain the meaning of the words used in the statute (consistent with s 19(1)(a)), but interpretation is not a search for the meaning of the secondary source, or for a purpose derived from an external source: Federal Commissioner of Taxation v Jayasinghe [2016] FCAFC 79; (2016) 247 FCR 40. In SZTAL v Minister for Immigration and Border Protection [2017] HCA 34, Kiefel CJ, Nettle and Gordon JJ stated [14]:
The starting point for the ascertainment of the meaning of a statutory provision is the text of the statute whilst, at the same time, regard is had to its context and purpose. Context should be regarded at this first stage and not at some later stage and it should be regarded in its widest sense. This is not to deny the importance of the natural and ordinary meaning of a word, namely how it is ordinarily understood in discourse, to the process of construction. Considerations of context and purpose simply recognise that, understood in its statutory, historical or other context, some other meaning of a word may be suggested, and so too, if its ordinary meaning is not consistent with the statutory purpose, that meaning must be rejected.
(citations omitted).
It is therefore in keeping with both s 19 of the Interpretation Act and general principles to consider at the outset the context in which s 71 of the Supreme Court Act was enacted, but the process of interpretation still begins and ends with the wording of the statute.
Consistent with s 18 and s 19(1)(b)(ii), where a literal reading of a statute leads to an absurd, extraordinary, irrational or anomalous result, such that the legislature could not have intended the statute to operate in that way, another interpretation is to be preferred: Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation (1980 - 1981) 147 CLR 297. Mason and Wilson JJ stated (321):
Quite obviously questions of degree arise. If the choice is between two strongly competing interpretations, the advantage may lie with that which produces the fairer and more convenient operation so long as it conforms to the legislative intention. If, however, one interpretation has a powerful advantage in ordinary meaning and grammatical sense, it will only be displaced if its operation is perceived to be unintended.
Significantly, however, the court does not cross the boundary between construction of a statute and what might have the appearance of judicial legislation: Minister for Immigration and Citizenship v SZJGV (2009) 238 CLR 642 [9] (French CJ & Bell J).
The process of interpreting a statute, like the process of interpreting a contract, is an objective exercise. The court has regard to the words of the statute and extrinsic materials for the purpose of determining the objective intent of Parliament. It is not a subjective exercise wherein the court constructs a straw poll of any member of Parliament who had any involvement in the drafting of the bill, or progress of the matter through Parliament, for their personal views on what they intended by the legislation. Subjective views on the interpretation of the legislation may differ and it may be that the objective intent of Parliament, as revealed by the statute, differs from the subjective understanding of individuals.
I mention this because, amongst the materials put before the court by the plaintiff, was a statutory declaration sworn by a former member of Parliament who supported the introduction of s 71 (and associated sections) in 2000. The statutory declaration does not purport to express a view as to the interpretation to be placed upon s 71 in any event, and any such view would have been irrelevant, but the statutory declaration does (a) quote what the member had said at the time as reported in Hansard, and (b) indicates what had not been discussed at the time. The statutory declaration is objected to by the plaintiff's former lawyers. It really adds nothing to the Second Reading Speech in any event and I have not placed weight upon it.
Finally, in light of certain propositions put in the plaintiff's written submissions before me, it is important to state a basic principle, namely that, in the case of conflict between the two, statutory law carries precedence over the common law. The common law reflects decisions of the judiciary over the centuries, following the principles of precedent. Parliament, in enacting statutory law within the scope of its legislative powers, may restate and confirm the common law, but it may also alter or even abolish a principle of common law. Without attempting any academic analysis of what limitations there might be on Parliament's ability to sweep away what might be regarded as certain fundamental rights, as a basic principle, Parliament is not bound, in enacting legislation, to merely restate the existing common law, and it is an error of approach to assume that any statutory provision must amount to a mere restatement of the common law.

Interpretation of s 71

On a literal interpretation of the wording of the statute, considering the ordinary meaning of the words employed, s 71(1) is broad and covers anything said or done, any communication or admission, not just in the course of an attempt to settle a proceeding by mediation but, also, for the purposes of an attempt to settle a proceeding by mediation. Its ambit, in terms of rendering evidence inadmissible, therefore, extends to some extent outside the mediation conference to conduct and statements made with that purpose. That concept is not new, having been acknowledged in Field v Commissioner for Railways for New South Wales, and other decisions.
In addition, s 71(2) provides that anything said or done, any communication or admission, and any document prepared, was done or created in confidence, imposing a duty of confidence on the author of the document and the parties and attendees, extending the protection of confidentiality considerably further than the inadmissibility of the evidence in a proceedings, and rendering the existence of that conduct and those statements and documents confidential. That confidentiality would clearly prevent discovery of such documents in legal proceedings, but also inevitably goes further than that. Section 72, which deals with confidentiality imposed on the mediator, is complementary to the confidentiality imposed by s 71(2). The exceptions in s 71(3) go to admissibility and not expressly to confidentiality, so the broad need for confidentiality is not disturbed. It is unnecessary in this case to explore that further.
The protection is not restricted to admissions made by a party. The section covers anything said or done, any communication or admission, necessarily implying that things said or done, and communications, need not amount to an admission against the author of the conduct or statement to fall within the scope of the section.
The protection is not restricted to the use of such evidence in the same proceedings concerning the same parties. Parliament could have stated that the evidence is inadmissible in the proceedings in which the mediation took place, but instead provided that the evidence is inadmissible 'in any proceedings before any court, tribunal or body', with no express limitation that the proceedings must be the same proceedings that involved the mediation, or that the parties must be in common.
And that is consistent with the use of the expression 'the parties to the mediation' in two of the four exceptions to the inadmissibility rule: namely where the parties to the mediation consent to the admission of the evidence in the proceedings, and where there is a dispute in the proceedings as to whether or not the parties to the mediation entered into a binding agreement to settle. If the ambit of s 71 was restricted to evidence sought to be used in the same proceedings in which the mediation occurred, 'the parties' would have sufficed to identify those who must give consent to the admissibility of the evidence. The additional clarification that the parties are 'the parties to the mediation' acknowledges that the section is sufficiently broad to extend to different proceedings before a different court involving different parties. It is also consistent with conferring confidentiality - not just inadmissibility - to all such conduct, statements, communications and documents.
Well prior to the introduction of s 71, Master White (as he then was) in Biala Pty Ltd v Mallina Holdings Ltd [1990] WAR 174 (cited in the passage quoted earlier in Old Papa's Franchise Systems Pty Ltd v Camisa Nominees Pty Ltd) had to decide whether a settlement agreement was itself covered by without prejudice privilege. Having referred to the decision in Rush & Tompkins Ltd v Greater London Council, Master White stated (180):
It is apparent from the aforegoing, that the privilege applies to exclude all negotiations genuinely aimed at settlement whether oral or in writing from being given in evidence. It renders inadmissible statements made in the course of without prejudice negotiations. However, the crisp question raised in the present applications is as to whether that privilege extends to the terms of the resultant settlement. In Rush & Tompkins, the terms of the settlement were disclosed to the third-party and it was the correspondence that preceded the settlement that was the subject of the application for discovery.
Where without prejudice negotiations do not result in a settlement, it is clear that statements made in the course of such negotiations are privileged from production and are inadmissible. It is, however, equally clear that, when such negotiations do result in a concluded settlement, the latter can be proved and be put in evidence. If that were not so, no settlement resulting from without prejudice negotiations could be enforced.
That decision was followed by French J in State of Western Australia v Southern Equities Corporation Ltd (in liq) (1996) ALR 597 (601). The language employed in s 71(1) is consistent with that principle. Section 71(1) renders inadmissible evidence of anything said or done or any communication or any admission made in the course of or for the purposes of an attempt to settle a proceeding by mediation. One of the few exceptions in s 71(3)(b) concerns a dispute in proceedings as to whether or not the parties entered into a binding agreement settling all or any of their differences, and the evidence or document is relevant to that issue. That exception seems to contemplate both the admissibility of any agreement said to have been reached, and documents extraneous to an agreement which might cast light on whether the agreement is binding and whether it settled all or any of their differences. The reasoning employed by Master White appears to me, with respect, to be equally sound in an interpretation of s 71. In the case before me, no settlement agreement was reached in the Supreme Court proceedings.
Section 71 contains no express exception where the evidence sought to be led relates to a claim of professional negligence by a lawyer in relation to advice given in the course of an attempt to settle a proceeding by mediation, or for the purposes of an attempt to settle a proceeding by mediation. Nor does it contain a more general exception where the evidence is sought to be led not for the truth of what was said, but for the fact of what was said.
On a literal reading of the section according to its ordinary meaning, the evidence relating to the offer made to the plaintiff by the defendants during the mediation conference falls within s 71 and does not fall within any of the exceptions in s 71(3). The section does not permit of two co-existing regimes for admissibility, the statutory privilege and the privilege at common law. The language employed is prohibitive, and covers the field. On a literal reading, s 71 extends the scope of the without prejudice privilege in relation to court‑ordered mediation conferences and creates a broader statutory privilege.
The Second Reading Speech confirms, rather than refutes, this conclusion.
Section 71 and the rest of pt VI of the Supreme Court Act came into operation on 6 July 2000 as part of the Courts Legislation Amendment Act 2000. In the Second Reading Speech, the Hon Attorney General Peter Foss QC stated:
Mediation in the Supreme Court: It is proposed to insert a new part VI into the Supreme Court Act dealing with court annexed mediation in the Supreme Court. The amendments give statutory force to the principle of confidentiality and the 'without prejudice' evidentiary privilege which are the cornerstones of the mediation process. Mediation conferences were introduced in the Supreme Court in 1993 as part of the case management initiatives designed to reduce delays and costs to litigants, and are now an integral component of the court's case flow management program. Mediation is a highly developed and successful avenue for resolving disputes in the court and an important step in the process by which a matter proceeds to trial. It has brought substantial benefits to the parties to litigation in earlier settlements and the savings of legal costs. It has also brought benefits in saving court trial days, estimated at 670 days in 1998. Currently, the confidentiality of the mediation process and its 'without prejudice' status have been underpinned by the Rules of Court and by the terms of the common form mediation order. This is now seen to be problematic, as recent cases indicate that these matters cannot be adequately addressed other than by amendments to the Supreme Court Act.
The amendments will reinforce the integrity of the mediation process in the Supreme Court by, first, imposing on parties and/or mediators a statutory obligation of confidence; secondly, clearly defining and extending the scope of the 'without prejudice' basis of the mediation; thirdly, conferring on mediators who conduct mediation conferences under the director of the court, the obligations, privileges and immunities of a judge; and, fourthly, making clear the scope of the court's rule making powers in respect of mediation. These are non‑contentious amendments derived substantially from model legislation drafted by the Law Council of Australia and indorsed by the Standing Committee of Attorneys General.
(my emphasis added)
The Second Reading Speech puts paid to any suggestion that s 71 was meant to restate the common law without prejudice privilege and nothing more. Consistent with the words of the section, the Second Reading Speech indicates a clear intention to give statutory authority to the privilege and, significantly, to define and extend its scope, and to establish a statutory duty of confidentiality, both of which serve to firm up a protection, not merely to restate it.
To the extent then that s 71 has provided for express exceptions, but has not included some exceptions which have been recognised in the case law concerning the without prejudice privilege, it cannot be assumed that Parliament overlooked those exceptions and would, had it thought of them, wanted them to form part of s 71, any more than it can be argued that the court has power to reinstate those exceptions under the common law into the statutory privilege. To do so would amount to judicial legislation.
Legislation from other jurisdictions in this country does not mirror s 71. That legislation is not limited to court-directed mediation however, but has much broader scope, encompassing communications between persons 'in dispute', or between one or more persons in dispute and a third party, in connection with an attempt to negotiate a settlement of the dispute. Section 131 of the 'Uniform' Evidence Act1995 in place in the Commonwealth and New South Wales contains a raft of exceptions to non‑admissibility, some of which have found a place in s 71 and some of which have not. None of those exceptions would have assisted the plaintiff in this case, even though there are numerous of them.
An exception found in the Evidence Act 1929 (SA), which is not found in our s 71, is where the communication relates to an issue in dispute which has already been settled or determined. That exception would plainly have assisted the plaintiff in this case, had it found its mirror in s 71. However, legislation from another jurisdiction cannot be used, as the plaintiff appeared in written submissions to possibly suggest, as a means to imply exceptions to s 71 that are not there. Indeed, the opposite is suggested: when our Parliament has not legislated for exceptions found in similar legislation in other jurisdictions, that rather tends to suggest that the exception was not thought desirable. In any event, this court cannot look to legislation from other jurisdictions and borrow exceptions from it to supplement the local legislation.

Section 71 and the purpose underlying it has been the subject of some judicial interpretation. In C v M, Kenneth Martin J commented generally on the importance of mediation process [25]:
Such mediations are a vital component of the civil litigation process in Western Australia. Almost every unresolved civil action in the Supreme Court as a matter of course will, prior to going to trial, experience some form of pre-trial mediation. In recent times, less than 3% of the total civil actions filed in the Supreme Court of Western Australia actually do proceed to a resolution at a trial. Court ordered mediations as a recognised process of dispute resolution within the fabric of the litigation process render an indispensable service to the quelling of civil disputes in this State.
In Naso v Danehill Nominees Pty Ltd, Martin CJ discussed the value of mediation and the purpose of s 71 generally [18] - [21]:
18In support of the application for injunction an affidavit was sworn by Mrs Naso's solicitor. He deposed at a number of points in that affidavit to information he had received and discussions that had taken place in the course of the mediation. That affidavit was a clear contravention of s 71 of the Supreme Court Act 1935 (WA) (the 'Act') which imposes a duty of confidence upon all who participate in mediation in relation to discussions and events that take place in the course of mediation.
19The terms of s 71 are wide and that is because of the obvious public interest in the strict enforcement of the confidentiality of mediation. There is a very strong public interest in the promotion of mediation as a means for the resolution of disputes. That interest will be jeopardised if parties and lawyers participating in mediation are not able to speak with complete candour, confident in the knowledge that the confidentiality of their communications will be respected and protected.
20The resources of this Court are limited and would not extend to trying any significant proportion of the cases that are lodged in the Court. In fact, less than 5 per cent of the matters that are lodged in the Court are determined after a trial. More than 95 per cent of the matters that are lodged in the Court are determined some other way and unless that continues through the use of mechanisms such as mediation, the public interest will suffer most adversely.
21Not only, of course, is the public interest in the efficient utilisation of the limited resources of the Court advanced by s 71, but also the interests of the parties to any mediation in achieving a timely resolution of their dispute without the further expense of a trial are protected by that section. It is therefore my view, that the Court must be rigorous to ensure due and full compliance with s 71.
In Pinto v Kinkela [2003] WASC 126, Commissioner Johnson QC (as her Honour then was) considered s 71 within the context of a costs application. The plaintiffs had sought injunctive relief against the defendants, until the defendants gave undertakings to desist from certain conduct. In the subsequent application for costs, the defendants wished to put evidence before the court as to what had occurred during court-directed mediation, which evidence the plaintiffs objected to. The case turned upon the interpretation of the costs exception in s 71(3)(c). The question was whether that required the evidence to be admissible under a rule of court governing admissibility of evidence the substance of a mediation conference, or merely a rule of court which dealt with evidence generally. The court favoured the former narrower interpretation.
The court noted that the Rules of the Supreme Court 1971 (WA) dealt specifically with evidence of the substance of a mediation conference only in O 29 and did not elsewhere address the admissibility of evidence of the substance of a mediation conference, except to prohibit a mediation registrar from reporting to the court on a mediation conference (unless to report lack of cooperation in the mediation, which report is not to be disclosed to the trial judge except on an issue of costs). The court found that the phrase 'for the purposes of determining any question of costs' required that the rule of court said to justify the admission of the evidence should relate specifically to admissibility in proceedings to determine costs because, otherwise, it would be redundant. The Commissioner stated [10]:
… the drafting of s 71 is consistent with a Parliamentary intention to restrict the use of the evidence to costs applications and leave the Court to determine whether the use of the evidence should be further limited. As counsel for the plaintiff observed, such an approach is common in legislation where a power to make subsidiary legislation is conferred.
A rule of court, of course, cannot contradict a statute enacted by Parliament. Of particular relevance to the issue before me, the Commissioner continued [11] - [13]:
11The defendants' primary submission was also supported by the more general proposition that, in relation to the issue of costs, an inability to refer to the substance of the mediation may render incomplete the relevant history of events, thereby creating an unsafe basis for the ultimate decision and potential 'unfairness' to a particular party.
12Similar submissions made in relation to other types of privileged information have consistently been rejected by the Courts on public interest grounds: see Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501, at 583, per Kirby J. The benefits to litigants and to the community of alternative dispute resolution are well established and the inclusion of the privilege in s 71 of the Act and the obligation of confidentiality imposed on the mediator in s 72 indicate that, in other than the specific situations identified in Part VI, those benefits are considered by Parliament to outweigh any disadvantage which may result to a particular litigant. Further, the statutory confidentiality imposed by s 71 of the Act necessarily creates a situation where parties are on notice that their conduct during the course of the litigation will be viewed without recourse to any matter which transpired in the course of the mediation and can adapt their subsequent conduct of the claim accordingly.
13For these reasons, I declined to allow either party to refer to any matter pertaining to the mediation process other than the fact and timing of its occurrence.
The decision in Pinto v Kinkela was affirmed as correct in the subsequent decision of the Court of Appeal in Western Areas Exploration Pty Ltd v Streeter[No 2] [2009] WASCA 15. Again, the decision concerned the costs exception in s 71(3)(c). A registrar of the court ordered the parties to participate in mediation before a registrar, which was scheduled but abandoned at the last minute. The appellant sought an order that the respondents pay its costs thrown away as a result. The appellant filed a number of affidavits in support which - given that mediation had not occurred - I infer related to things said or done and communications made for the purposes of an attempt to settle the proceeding by mediation, and were therefore caught by s 71(1).
The respondents objected to the affidavits in their entirety, citing Pinto v Kinkela. The appellants invited the court to find that Pinto was wrongly decided, arguing that O 29 r 3(2) does not prescribe the omission of all evidence except a report from the mediation registrar but, rather, creates an exception to the ordinary rule precluding the mediator from being called as a witness. Alternatively, counsel argued that Pinto was distinguishable in that the appellant was seeking to lead evidence in relation to the issue of the costs of the cancelled mediation, while the decision in Pinto concerned evidence sought to be led as to the question of the costs of the entire action.
Buss JA, with whom Wheeler and Pullin JJA agreed, held that Pinto was not incorrectly decided [38] - [41]:
38In my opinion:
(a)s 71(1) and (3), read with the amended s 167(1)(q); and
(b)the contrast between para (c) of s 71(3) on the one hand, and paras (a), (b) and (d) of s 71(3) on the other, to which I have referred to at [28] ‑ [31] above,
indicate that the exception in s 71(3)(c) authorises the admissibility of evidence or documents relating to statements, communications and admissions made, in the course of or for the purposes of an attempt to settle a proceeding by mediation under direction, only where the evidence or documents are sought to be given or tendered:
(c)in proceedings relating to a 'costs application' (as defined in s 71(5)); and
(d)the Rules specifically permit the evidence or documents to be admitted in evidence for the purposes of determining any question of costs (whether in relation to the mediation only or in relation to the civil proceedings as a whole).
39The construction of s 71(1) and (3) that I prefer is consistent with (and, indeed, reinforced by) the Attorney-General's second reading speech which suggests a Parliamentary intention, in enacting Pt VI of the Act, relevantly, to impose on the parties to civil proceedings a statutory obligation of confidence and to extend the 'without prejudice' basis of court ordered mediation. The new statutory provisions were intended to reinforce the public policy objectives of encouraging parties to settle civil proceedings by the mediation process as soon as practicable before trial. The Attorney-General's speech confirms the ordinary meaning which is conveyed by the statutory text.
40Order 29 r 3 did not, in the present case, authorise the admission into evidence of the affidavits sought to be relied on by the appellant. No other provision of the Rules specifically authorised the admission of the affidavits. The exception in s 71(3)(c) was therefore unavailable.
41Pintowas not wrongly decided. Further, the decision in that case is not relevantly distinguishable. Section 71(1) and (3) apply not only to the admissibility of evidence or documents of the character governed by s 71 in the context of an application for the costs of a mediation only, but also in the context of an application for the costs of civil proceedings as a whole.
C v M, before Kenneth Martin J, was an unusual case. Two actions were referred to mediation before a registrar and a joint mediation took place. Neither action settled as a result, but, following the mediation conference, the solicitor for one of the defendants emailed his client, summing up his perception of the mediation conference. The email was headed 'Private and Confidential'. It contained considerable detail about the contents of the mediation conference, including the terms of a settlement offer by the plaintiff. No criticism was made of the lawyer for reporting to his client about the day's conference (at which both had been present).
What followed, however, was that the defendant forwarded that email from his lawyer to multiple people thought by the defendant to be interested in the settlement offer and potentially affected by it. The email from the solicitor was said to have been 'couched in robust terms' and 'heavily slanted towards the defendant's position'. The recipients forwarded it to others, until it eventually reached the plaintiff's business manager, with a request for clarification about its contents.
The plaintiff complained 'that the confidentiality of the mediation process has been violated to his very considerable prejudice', contending that his business interests had been hurt by the email's unauthorised circulation. He sought approval from the court to communicate to the various recipients of the on‑forwarded email, putting his own version of events at the mediation. At [27] the plaintiff:
(correctly) recognises that for him to take such a step unilaterally would violate the confidentiality of the mediation - contrary to s 71 of the Supreme Court Act. So he brings this application seeking that the court approve his communication to such persons, as he would seek, to set the record straight, as he would see it.
Martin J set out s 71 in full and noted [7]:
Subsection 71(3), to which s 71(1) and s 71(2) are made subject, lists four scenarios in which evidence is excluded from the inadmissibility regimes under s 71(1) or s 71(2). The wider notion of 'confidentiality' is not explicitly expressed by s 71(3) other than in qualifications made to the admission into evidence of documents or information that would otherwise be in admissible before a court. But the concept and reach of the principle of confidentiality extends well beyond the bounds of the court room.
The defendant argued that this conduct did not constitute any breach of the confidentiality arising from the mediation. His lawyer's initial response was to claim that the confidentiality requirement only prohibited the parties to the mediation disclosing the contents of the mediation to the court, and did not extend to prohibiting disclosure to third parties, claiming that it was unreasonable to suggest that the defendant was not entitled to take advice from various interested parties regarding the proposals made during the conference. Martin J described that initial response as having [61] - [66]:
61in effect, asserted that communications passing at a mediation conference were only covered by without prejudice privilege. Accordingly, it was accepted that the documents and information exchanged at the mediation would not be admissible in evidence at any ultimate trial of the actions. Otherwise however, the defendants' position then expressed, was that what had passed between the participants at the mediation, including comments by the mediator, were, apart from their inadmissibility at a trial, otherwise fully amenable to being communicated without any constraints to virtually anyone, and particularly to anyone who happened to qualify as an 'interested' third party.
62This confidently expressed negative response (now no longer advanced) was offered up at the time (it would seem) without any supporting basis in case precedent or authority to support it. In my assessment the response demonstrated a careless and unprincipled disregard to the words used in s 71(1) and (2). True it is that s 71(1) and (2) do make express reference to things said and done, and to oral or writing communications or admissions, not being admissible in proceedings. That obviously does render documents and communications subject to without prejudice privilege. But the section clearly goes much further. It expressly renders such matters to be in confidence (s 71(1)). As regards documents, the same matters arising in documents are 'subject to a duty of confidence' (s 71(2)).
63The construction of s 71, articulated in the defendant's solicitors' correspondence (prior to written submissions) relied heavily on the word 'and' used in each of s 71(1) and s 71(2). The word 'and' was used to read s 71 down so as to provide only one (conjunctive) element of protection, namely, the evidentiary inadmissibility of the information or documents in proceedings. In other words, mediator communications were accepted to be governed by without prejudice privilege, as against their subsequent inadmissibility in evidence, but to no more. As to without prejudice privilege concerning the inadmissibility in evidence of admissions, see Field v Commissioner for Railways for New South Wales [1957] HCA 92; (1957) 99 CLR 285, still the leading authority on the subject.
64Without prejudice privilege is obviously enjoyed by parties in a settlement negotiation. As a privilege enjoyed mutually by the parties in a bilateral negotiation, that feature necessarily inhibits the amenability of the privilege to unilateral assertions of waiver by merely one of the parties to negotiations. A Calderbank communication (see Calderbank v Calderbank [1975] 3 All ER 333) however, is an example of without prejudice privilege in a communication being unilaterally expressly reserved for future possible waiver, as regards the limited issue of costs, at the completion of the proceedings.
65Section 71(1) uses the word 'confidence'. Section 71(2) uses the expression 'duty of confidence'. An expression involving 'duty' suggests that what is delivered by s 71 goes beyond merely specifying evidentiary inadmissibility in the information or document to a court at any ensuing trial. The defendants' solicitors' constrictive construction of s 71(1) and s 71(2) does not go far enough. A wider obligation of overarching confidentiality, applicable to all proposed participants in the mediation is imposed. The imposition of confidentiality rests beyond narrower inadmissibility constraints. Dual protections arising from confidentiality as well as inadmissibility deliver protections to the mediation process and participants going wider than simply imposing a constraint against subsequent use of information or a document in evidence at a trial. Some limited relaxations then seen under s 71(3) as regards admissibility do not affect or undermine the residual confidentiality protection that is delivered.
66To the extent that there could be some doubt over the correct construction of s 71, it is wholly resolved by recourse to extrinsic (parliamentary) material …
Martin J then referred to the Second Reading Speech (quoted above) before continuing at [67] - [69]:
67Reference may be seen to be made in the above extracts to both confidentiality and without prejudice evidentiary privilege as being cornerstones of the mediation process (ie rather than merely to one cornerstone).
68The second Hansard paragraph cited carries express reference to obligations of confidence reposed upon the mediator (s 72 deals with that issue specifically). It then refers, in the context of confidentiality, to 'parties' as well as to mediators. A 'statutory obligation of confidence' is clearly distinguished as a first and distinct aspect underlying the integrity of mediations conducted in the Supreme Court. Confidentiality is clearly expressed here as a stand alone condition.
69Confidentiality then is applicable above and beyond the related but conceptually distinct aspect of protection, delivered by without prejudice privilege made applicable to communications and documents and thereby rendering those matters inadmissible at a trial.
As to the submission that a confidentiality obligation or duty under s 71 did not inhibit disclosure to third parties who were 'interested in the litigation', Martin J commented [87]:
Mr M's on-forwarding of what in part looks to contain legal advice to him from his solicitor Mr Draper would likely amount to a waiver of the legal professional (or client legal) privilege he otherwise held in his solicitor's professional communication to him. Mr M's waiver of his own client privilege, however, is not the point as regards to the distinct issue of confidentiality covering what was said or done at the mediation.
Martin J found that the obligation of confidentiality attaching to Mr M as a participant in the mediation was disregarded and violated by his onforwarding of the email to the various recipients. His Honour made some observations about the potential for disclosure of confidential information, notwithstanding s 71(1) at [98] - [103]:
98Had Mr M wished to provide some report or take in the input of these persons as to what occurred at the section 71 mediation, clearly his obligation behoved him to make that clear at the mediation in express terms. He could then seek to obtain the adversary party's consent to any disclosures, together with the mediator's consent as well. If that was not given, the court might be approached to approve a partial disclosure - before it happened, if they were thought to be necessary in the interests of justice.
99This Court as the controller of its own processes would clearly have the power to grant a dispensation in appropriate circumstances. Care would need to be taken however so that inappropriate material was not put before the ultimate trier of fact. …
100… It was not for Mr M to arrogate solely to himself a decision as to who or may or may not receive such confidential information. He was seriously in error in on‑forwarding this email without first obtaining the adversary party's consent or the court's approval before doing so.
101The statutory obligation of confidentiality attaching to mediations by direction is intended to promote an open, protected environment for parties to frankly and freely attempt to reach the resolution of their civil disputes, if they possibly can. That event frequently and overwhelmingly occurs, but not always so. But irrespective of a settlement or not, the protection of confidentiality over what passes back and forth in a mediation will remain. That is so unless there is a fully consensual release by the parties, or under an order of the court. Here Mr M's unilateral disclosure by the forwarded email, in my view, was a violation of an indispensable protective component of the court's processes. It would also likely be a contempt of court, as I would see it, although argument was not heard on that point and the plaintiff does not press for any ruling or sanction in that respect.
…
103But I am not prepared to make an order unilaterally permitting Mr C to make an unsupervised responsive communication to recipients of Mr M's email communications. The court of course has inherent power to control and deal with abuses of its process, as well as to regulate its procedures. But countenancing two wrongs is not a scenario that would usually be approved. One confidentiality violation, by Mr M, is more than enough.

But if I am wrong in that view, and if the consent of the parties to the mediation might consist of implied waiver on their part, nevertheless the plaintiff has not established consent by implied waiver on the part of the parties to the mediation.
Firstly, according to the judgment in the Supreme Court costs application, it appears only one of the defendants sought to place the offer made by all in mediation before the court. All must consent. That is fatal to the plaintiff's argument.
But further, I do not consider that an unsuccessful attempt to tender the offer in the costs application - one of the express exceptions contemplated in s 71(3) - amounted to a waiver generally of the privilege and confidentiality attaching to the document. The law recognises that waiver, even implied waiver, of a privilege can be for a limited purpose (as to which see Bourns Inc v Raychem Corp [1999] 3 All ER 154; B v Auckland District Law Society [2003] 2 AC 736; Eurasian Natural Resources Corporation Ltd v Dechert LLP [2016] EWCA Civ 375; [2016] 1 WLR 5027, [47] - [57] (Gloster JA, with whom King & David Richards LJ agreed)).
Because a costs application is an exception to s 71(1), the attempt to tender the document by that single defendant was not inconsistent with the continuation otherwise of the privilege and confidentiality attached to the document by s 71(1). A waiver arises out of an inconsistency between the use of the document and the maintenance of the privilege. There was no inconsistency and therefore no waiver of privilege or confidentiality - there was merely a misconceived attempt to bring the offer within one of the exceptions which defines the limits of the privilege and confidentiality established by the statute. The attempt to tender the offer did not reveal an inconsistency, then, with the maintenance of the privilege generally, such as would authorise its tender generally. If there can be a waiver of the statutory privilege so as to amount to 'consent' pursuant to s 71(3), there was no implied consent by waiver of the general privilege in this case.
Finally, the terms of s 71(3) are specific: the consent of the parties to the mediation must be consent to 'the admission of the evidence or document in the proceedings' and the context indicates that 'the proceedings' are the proceedings in which it is sought to admit 'the evidence or document'. It cannot be said that the defendant who sought to tender the offer made during mediation as part of a costs application contemplated or consented that it would be led as evidence in subsequent proceedings against the plaintiff's former lawyers.

Ruling as to the offer to settle received in mediation

The handwritten offer from the defendants to the plaintiff was a written communication, as well as something said or done, in the course of an attempt to settle a proceeding by mediation under direction. It falls within s 71(1) and (2) and does not fall within any of the exceptions created by s 71(3).
The offer, both the fact of it and the contents of it, is inadmissible. It is inadmissible pursuant to s 71(1) in any proceedings before any court, including the proceedings before this court in which only the plaintiff is involved and none of the other parties to the Supreme Court proceedings. The reference to it in the statement of claim cannot be supported by evidence. Not only is the evidence of that offer inadmissible, the offer is a document which was created in circumstances of confidentiality and, on either basis, must be kept from the knowledge of the trial judge. The reference to the offer in the supporting affidavit material is likewise a breach of the confidentiality requirement in s 71.
There is no discretion in this court to allow its admission by some means. There are not two possible interpretations of s 71 available, one of which enables the plaintiff to lead the evidence. There is no available interpretation of s 71 which enables this court to say that, notwithstanding that this case relates to things said and done during the course of, and for the purposes of, an attempt to settle a matter in court‑ordered mediation, s 71 just does not apply. And there is no power in this court to read s 71 down such that it does not apply if the proceedings relate to a professional negligence claim said to have arisen out of the mediation, or to imply some such exception. To do so would amount to judicial legislation.
Because the offer made during the court-ordered mediation is inadmissible, the plaintiff cannot ground that cause of action which relates to the reply to that offer. That is so even though the reply was sent after the conference concluded. Her case cannot sensibly be pleaded without reference to the offer itself, given that the claim is that the plaintiff's former lawyer was negligent in failing to respond to the offer in such a way as to avoid making a counter‑offer (while also including some certainty about the date upon which the plaintiff would receive payment of the offered sum). Both the fact of the offer and its terms are essential to ground that pleading, and both are inadmissible.
Further, the plaintiff cannot sensibly mount proof of damages without reference to the offer made during mediation, because the damages is essentially the difference between the sum obtained following unsuccessful litigation and the sum she might have gained had the offer been accepted. Her schedule of damages filed 5 July 2021 makes specific reference to the amount of the offer made during mediation.
It follows that my ruling concerning the offer made in mediation itself makes it impossible for the plaintiff to plead her case in relation to professional negligence concerning the offer and acceptance. I can see no means by which the plaintiff can plead her cause of action concerning the offer made during mediation and the allegedly negligent response to it without offending against s 71(1). This ruling also has the effect that any evidence as to the former lawyer's response to the offer made in mediation is pointless, because its only relevance is inextricably bound up with the offer itself.

Ruling as to the evidence of the former lawyer's response to the offer made during mediation

Although my ruling above renders pointless the leading of any evidence as to the former lawyer's response to the offer, I consider that the evidence of the former lawyer's response to that offer is also inadmissible in its own right pursuant to s 71 in any event.
The factual position is slightly different in that, when the former lawyer's response was sent, the mediation conference had come to an end and the parties had left the building. The material before the court - both in the bundle agreed between the parties and the statement of claim - indicates that the defendants' offer made during mediation was open for two days. I will not mention the identifying particulars of the specific date and time frame. The plaintiff's former lawyer responded to that offer on the afternoon of the second day, in terms purporting to accept the offer but adding a condition as to the date of payment and also as to the exchange of a bank cheque for the dismissal of the Supreme Court proceedings.
I consider that written response is also captured by s 71(1) as a written communication made 'in the course of or for the purposes of an attempt to settle a proceeding by mediation under direction'. I make that finding for several reasons.
Firstly, the content of the response (which is set out in the statement of claim) discloses the substance of the inadmissible offer made during the mediation conference, referring to the fact of the offer made by the defendants, the sum on offer and the dismissal of the plaintiff's two Supreme Court proceedings in return for that sum. The reference to those factors is critical to the plaintiff's case and they cannot be redacted from the response for the purposes of the trial, because even a reference to the fact of an offer having been made in mediation is inadmissible. It necessarily follows that the former lawyer's response to the defendants in the Supreme Court proceedings is inadmissible in these proceedings because it encapsulates a confidential and inadmissible earlier written communication which falls within s 71(1).
Secondly, I consider that the response falls within the terms of s 71(1) in its own right. Although the mediation conference had concluded by the time it was sent, the response to the offer made during the mediation conference was still a written communication made for the purposes of an attempt to settle a proceeding by mediation under direction. The offer to which it responded had been made during mediation under direction and was good for only two days, the response was sent within the time period that the offer was open, the document does not address any other topic and is solely devoted to responding to the offer which was made during mediation and was plainly part of an ongoing effort to bring the mediation to a successful conclusion.
Obviously, a decision of this sort must depend upon the facts and circumstances of each individual case. When the plaintiff's counter‑offer was not taken up by the defendants in the Supreme Court matter, her former lawyer wrote to the court two weeks later asking for the mediation to be reconvened. Whether because of some communication breakdown, or because the court wished to check that the situation had not altered before taking any further step, the court responded by letter about three weeks later asking whether the matter had settled. As late as 9 months later, the lawyer for the executor (several of the defendants in that action being unrepresented) emailed a couple of the parties, including one who resided overseas, confirming that Registrar Boyle (who had first directed the matter go to mediation) had confirmed at a recent hearing of the matter that the mediation was still on foot, requiring the matter to go back to mediation one last time.
The defendants submit in this case that mediation remained ongoing and that, consequently, the former lawyer's response to the offer made during mediation occurred in the course of mediation.
I do not accept the submission that the parties were in a constant state of mediation over a period of some 10 months and that, therefore, anything said or done with a view to settlement between the parties outside a mediation conference was necessarily captured by s 71(1). But there is no need to consider the facts of this case on that broad basis as the former lawyer's response, made only two days after the mediation conference, was in direct response to the offer made during the mediation conference and for the purposes of enabling the mediation conference to come to a successful conclusion. Whatever the outer limits of the expression 'for the purposes of an attempt to settle a proceeding by mediation under direction' in s 71(1) may be, there is no need to test them on the basis that the mediation was reconvened. On the factual basis of this case, I consider the response by the plaintiff's former lawyer to the offer made two days earlier during mediation does fall within that expression.
If I am wrong about that, and the written response to the offer made in mediation is not within that expression, it still refers to the substance of an offer made during mediation which is inadmissible and confidential, and the response cannot sensibly be redacted and yet serve the plaintiff's case. If, by editing, it is converted into an apparent offer made by the plaintiff outside mediation, her claim that it was negligently drafted so as to constitute an offer - rather than the acceptance she believed it to be - disappears. She has no case against her lawyer merely because the defendants did not accept her offer. Her case depends upon it having been a response to an offer from the defendants.
The written response is inadmissible. This ruling merely confirms the earlier ruling as to the inadmissibility of the offer. The plaintiff cannot plead her cause of action pertaining to the response to that offer.

The second cause of action concerning the second writ relating to shares

The plaintiff pleads another cause of action which is impacted by these rulings. She pleads that she was advised by her former lawyer to file a second writ in the Supreme Court against three of the same defendants to her first, including the executor, in relation to the transfer of shares from her to her father while he still lived, without her consent and for no consideration. That second action, she pleads, was a strategy advised by her lawyer to better motivate the defendants to make an offer to settle her first action, although she does also claim it was based upon evidence. She also pleads that it was 'a strategy rather than an action to be pursued to completion'. The writ in the second action had been filed but not served, the strategy being to serve it prior to and close in time to the mediation conference.
The plaintiff alleges that her former lawyers 'either knowingly or negligently … failed to competently serve' two of the three defendants to that second action prior to the mediation conference. It seems one was served. The plaintiff also pleads that her former lawyer did not pursue the second action during the mediation conference 'in a forceful or threatening manner', contrary to the strategy to strengthen the plaintiff's position in mediation. As a result, the plaintiff alleges, the sum offered by the defendants during the mediation was limited to the sum the plaintiff could ask for in the first action only, whereas she believes she had the potential to seek an extra sum in respect of the second action. She pleads that the failure to serve the writ on two parties prior to the mediation conference was the direct cause of the offer being limited to the sum offered.
Leaving aside any thoughts on the merits of that action - it being no part of this judgment to determine the merits or otherwise of the plaintiff's case - it is apparent from the inadmissible offer made by all defendants in mediation that the second action was the subject of the offer to settle made during mediation and that, in the inadmissible response to that offer, the plaintiff offered to discontinue both actions. It is apparent that all parties at the mediation were aware of its existence and that there was an unsuccessful attempt to settle it as well as the first action during mediation. That stance carried into the counter‑offer which, incidentally, did not seek any additional sum to the defendants' offer.
Any discussions that took place during mediation for the purposes of attempting settlement are inadmissible, and that extends to any discussions during mediation concerning the second action, even though it had not been served on two out of three defendants to that action, because those discussions formed part of the discussions to settle the first action which was the subject of the court-directed mediation. And that also extends to any discussions between the plaintiff and her former lawyer after mediation in which the offer made by the defendants, in so far as it touched upon the second action, was discussed. The plaintiff could testify about the strategy in filing the second writ, and the failure to serve two of the parties, and what she hoped and anticipated would occur during mediation - and the specific objections taken by her former lawyers appear to be consistent with that analysis - but not what actually occurred during mediation, nor the offer made by the defendants, nor her former lawyer's response to it. The court could draw no conclusions about any implications of the failure to serve two parties, as it could not speculate about what occurred during mediation.
I can see no means by which the plaintiff can plead the cause of action concerning her second writ without infringing s 71(1), because her case is that the consequence of the failure to serve the writ was that the offer made during court‑directed mediation was limited to what she could ask for in relation to the first action, and those discussions and that offer are simply inadmissible. The cause of action therefore deteriorates to a complaint to the writ wasn't served when she thought it would be, with no consequences sounding in potential damages.

Consequences of the rulings

The evidence being inadmissible, the plaintiff will not be entitled at trial to refer to the offer which was made by the defendants during mediation - indeed anything said or done during that mediation which falls within s 71 - or the response to that offer, or any discussions between her and her lawyer about that offer which might tend to suggest that the offer was made, or what the offer consisted of. Further, the statement of claim itself breaches the confidentiality requirements of s 71. It is not sufficient to rule the evidence inadmissible - matters currently pleaded in the statement of claim are confidential and must not be revealed to anyone, including the trial judge. It follows that those references to the defendants' offer and the former lawyer's response to it contained within the statement of claim cannot stand.
Turning now to the specific offending pleadings, Schedule A prepared by the former lawyers, defendants to this action, and incorporated into the order of the deputy registrar of this court made 5 November 2021 identifies those parts of the statement of claim which are said to infringe s 71(1). I was provided with a copy of the statement of claim with those same portions highlighted, which makes for easier reading and is more refined than the schedule. My rulings as to specific paragraphs which cannot be in the statement of claim are attached as 'Annexure A'. The rulings are almost entirely consistent with Schedule A, with a few additions and one ruling which deletes slightly less than the deletion sought.
The trial judge must not be informed of any inadmissible and confidential material. The inadmissible material must not be mentioned in evidence led at trial, nor in written or oral submissions, nor in the pleadings. If the plaintiff intends to proceed with whatever is left of her action, it will be necessary for the statement of claim to be substituted, rather than amended in the usual way (which shows how the document previously stood prior to amendment). The substitute statement of claim should only reflect the new pleading.
The current statement of claim and any confidential and inadmissible materials which were put before me on this application will be sealed, and a prominent note left for the trial judge to confine his or her reading of the pleadings to the substituted statement of claim which will have to follow. I will make programming orders following delivery of these reasons to the parties. And, finally, I make orders suppressing the parties' names to this judgment (which have therefore been anonymised) and the action number from publication in the judgment available to the general public.

Annexure A

The following passages in the statement of claim dated 4 November 2020 breach s 71(1) and must be excised as follows:
1.par 1B in its entirety; (as per Schedule A)
2.par 1C in its entirety; (as per Schedule A)
3.par 1D - 'Failure to inform … had failed and'; (as per Schedule A)
4.par 18 - 'and not responding …to the Offer'; (as per Schedule A)
5.par 28 - 'During the … (as indicated in paragraph 16 above)'; (as per Schedule A)
6.par 29 in its entirety; (as per Schedule A)
7.par 34 in its entirety; (as per Schedule A)
8.the heading B immediately above par 34; (an addition to the deletions sought by Schedule A)
9.par 36 - 'wherein the Second Defendant … (to end of par); (as per Schedule A)
10.par 37 in its entirety; (as per Schedule A)
11.par 38 in its entirety; (as per Schedule A)

12.par 39 in its entirety; (as per Schedule A)
13.par 40 in its entirety; (as per Schedule A)
14.par 41 - 'plus another 6K … hanging for now'; (as per Schedule A except first half of par ruled in)
15.par 42 in its entirety; (as per Schedule A)
16.par 43 in its entirety; (as per Schedule A)
17.par 44 in its entirety; (as per Schedule A)
18.par 45 in its entirety; (as per Schedule A) - note that the document which refers to possible outcomes of the Supreme Court litigation might be admissible, on some basis, in an edited form which deletes any reference to any offer made or response to it, although the court notes that the plaintiff also denies ever having received the letter
19.heading immediately above par 45; (an additional deletion to those sought in Schedule A)
20.par 46 - 'and finalised the letter …you accept it'; (as per Schedule A)
21.par 47 - 'however, included in the bundle … file note instead'; (as per Schedule A)
22.par 49 - 'and re‑affirmed to the … time to move on'; (as per Schedule A)
23.par 50 in its entirety; (as per Schedule A)
24.par 52 table re content of file note:
(a)Item 2 (3) - 'I told her … felt cornered' and 'the Pl was annoyed … have been written contemporaneously'; (as per Schedule A)
(b)Item 3 in its entirety; (as per Schedule A)
(c)Item 4 in its entirety; (as per Schedule A)
(d)Item 5 - 'recommended acceptance of offer'; (as per Schedule A)
(e)Item 6 in its entirety; (as per Schedule A)
(f)Item 7 - 'when the Pl points out … the Executor and the Siblings'; (as per Schedule A)

25.par 53 in its entirety; (as per Schedule A)
26.par 54(d) in its entirety; (as per Schedule A)
27.par 55 in its entirety; (as per Schedule A)
28.par 56 in its entirety; (as per Schedule A)
29.par 57 in its entirety; (as per Schedule A)
30.par 58 - 'The Plaintiff is unaware … Letter was emailed to him' and 'My client agrees … Order 24A rule 4)'; (as per Schedule A)
31.par 59 - 'However it can be inferred … finalisation of same?'; (as per Schedule A)
32.par 60 - '(5 days after the deadline for accepting the Offer)' and 'No mention was made …interpreted the Letter'; (as per Schedule A)
33.two headings immediately above par 60 out in their entirety; (an additional deletion to those sought in Schedule A)
34.par 61 - 'the Plaintiff would have had the opportunity … favour of settlement'; (as per Schedule A)
35.par 62 in its entirety; (as per Schedule A)
36.par 63 - 'The counter offer … (lack of acceptance)'; (as per Schedule A)
37.par 64 - 'The Plaintiff asserts … from the Deceased's estate'; (as per Schedule A)
38.par 66 - 'I have not heard from …the settlement'; (as per Schedule A)
39.par 68 - 'If the Second Defendant … because' and 'a matter that would have … the other siblings'; (as per Schedule A)
40.par 69 - 'especially as the Letter states … deposit rolled over)'; (as per Schedule A)
41.par 75 in its entirety; (as per Schedule A)
42.par 79 - 'which prevented the Plaintiff from attempting to mitigate … (or lack thereof)'; (an additional deletion to those sought in Schedule A)
43.par 79 table first row 'Counter Offer'; (as per Schedule A)
44.par 79 table third row 'client agrees to settle … of entitlement'; (as per Schedule A)
45.par 79 table 14^th row 'Where is my money? ' and 'No response'; (an additional deletion to those sought in Schedule A)
46.par 80 - 'as she believed … 000)': (as per Schedule A)
47.par 84 - 'She (the Second Defendant) … time for payment'; (as per Schedule A)
48.par 85 in its entirety; (as per Schedule A)
49.par 88 in its entirety; (as per Schedule A)
50.par 90 - 'asking: I don't believe … Mediation session'; (as per Schedule A)
51.par 91 - 'why did this matter … all action'; (as per Schedule A)
52.par 93 table second row in its entirety; (as per Schedule A)
53.par 94 - 'inability to re-secure … Mediation and'; (as per Schedule A)
54.par 97 in its entirety; (as per Schedule A)
55.par 98 - 'The 2014 … being made and'; (as per Schedule A)
56.par 102 - 'in failing to … 2013'; (as per Schedule A)
57.par 103 in its entirety; (as per Schedule A)
58.par 104 in its entirety; (as per Schedule A)
59.par 108(2), (3) and (5) in their entirety; (as per Schedule A)
60.par 108(4) - 'The Second Defendant failed to … had failed and' and 'and a distribution from … Mediation'; (as per Schedule A)

In addition, the plaintiff's schedule of damages filed 5 July 2021 needs to be substituted, with the words 'the amount offered of' (or any other reference to matters which fall within s 71(1)) absent from any substituted version.

I certify that the preceding paragraph(s) comprise the reasons for decision of the District Court of Western Australia.
DD
Associate to Judge Sweeney
6 SEPTEMBER 2022