Sir Michael Birt, Kt., Bailiff, sitting alone.
Dominic Neil Kilbey
James Patrick Gorton Baker
Hugh Peter Jones
Advocate M. P. Renouf for the Representor.
Advocate O. A. Blakeley for the Respondents.
1. This is an application by the Respondents for leave to adduce at trial evidence of what was said during an unsuccessful mediation. It requires the Court to consider the circumstances in which material which is privileged because it arises out of without prejudice meetings or correspondence can nevertheless be admitted in evidence.
2. The Court announced its decision to refuse leave for the Respondents to adduce the evidence shortly after the hearing. What follows constitutes my reasons for that decision. For obvious reasons, this judgment will only be published after the conclusion of the trial.
3. The second and third Respondents ("Mr Baker" and "Mr Jones") formed the First Respondent ("Grafters"), a company incorporated in Jersey, in March 2006. Grafter's business consists of the placing of casual manual labour. Originally there was a third equal shareholder but in October 2006, he sold his shareholding to Mr Kilbey, who was also appointed a director.
4. Unfortunately, the relationship between Mr Kilbey and the Respondents did not work out. The reasons for that will no doubt be explored at trial but they are not material for present purposes. As a result, on 23rd March, 2007, at a meeting of shareholders, it was resolved to remove Mr Kilbey as a director. However, he remained as a one third shareholder and indeed that is still the position.
5. On 31st July, 2007, Mr Kilbey incorporated a new company called Manual Labour Solutions Limited ("MLS") which carries on business which is similar to that carried out by Grafters.
6. On 27th November, 2009, Mr Kilbey issued proceedings against the Respondents seeking relief for unfair prejudice in relation to his position as a shareholder in Grafters. The proceedings appear to have proceeded at a somewhat leisurely pace, perhaps because an investigation was being carried out by the Data Protection Commissioner following a complaint by the Respondents that Mr Kilbey had committed breaches of the data protection legislation.
7. In September 2012, the Respondents instructed Advocate Blakeley in place of their former advocates and he wrote to the Data Protection Commissioner seeking information about the result of her investigation. By letter dated 16th October, 2012, she informed Advocate Blakeley that, during the course of the investigation, Mr Kilbey had admitted copying certain data (referred to below) belonging to Grafters but denied having used it.
8. Following this, Grafters filed a counterclaim on 7th November, 2012. At paragraph 13 of the counterclaim, Grafters stated that, in order to run its business, it maintained:-
(i) a database comprising information on all customers who have used the services of Grafters ("the Customer Database");
(ii) a database comprising information on all casual labourers who have registered with Grafters ("the Labour Database");
(iii) an electronic library of contracts, stationery and other documents used in the day to day business of Grafters ("the Document Library"); and
(iv) accounting information which included payroll information, invoices rendered and invoices received ("the Accounting Data").
The counterclaim referred to all these categories of data as the "Business Data".
9. The counterclaim went on to allege that in March 2007, without authorisation, Mr Kilbey had copied the Business Data with the intention of using or potentially using it to further his own intended business interests. At paragraph 25 of the counterclaim, Grafters alleged that, in breach of his duties owed to Grafters, Mr Kilbey had:-
(i) used or caused MLS to use a copy of the Customer Database to contact past and existing customers of Grafters in order to attract them as customers of MLS:
(ii) used or caused MLS to use a copy of the Labour Database to contact past and existing labourers at Grafters in order to attract them as labourers for MLS;
(iii) used a copy of the Document Library for use by MLS; and
(iv) used a copy of the Accounting Data to provide MLS with information on rates charged by Grafters to its customers and rates paid by Grafters to its labourers, thereby enabling MLS to competitively price itself in the business market when trying to attract its own customers and/or labourers.
10. In his answer to the counterclaim dated 8th February, 2013, Mr Kilbey admitted copying the Business Data but denied doing so to further his own intended business interests. He averred that he did so in order to obtain fair value for his one third shareholdings in Grafters and to have evidence for use in any discussions or negotiations or legal proceedings which might follow. As to the alleged use of the Business Data he said as follows in relation to the four categories of Business Data:-
(i) He denied using the Customer Database at all.
(ii) He denied deliberately using the Labour Database. However, he admitted that in the last quarter of 2009 an employee of MLS had erroneously accessed parts of the Labour Database to contact four potential carpenters. He asserted this was a one off incident and it was not believed that any of the four people contacted had in fact worked for MLS.
(iii) He said that the Document Library only consisted of four uncopyrighted documents, namely timesheets, job sheets, employee terms and conditions and a client agreement. He accepted that he may have used some of these documents but asserted that they were in effect widely circulated and freely available. For example, he said that Grafters' terms and conditions were originally obtained from the Jersey Arbitration and Conciliation Service and were available on that organisation's website.
(iv) He denied using the Accounting Data.
11. Mr Kilbey has also sworn certain affidavits during the course of these proceedings. His affidavit dated 14th December, 2012, was broadly consistent with what was subsequently stated in his answer to counterclaim as described above. He admitted making a copy of the Business Data for the purposes referred to and contended that this did not amount to "taking" the data because he felt that he was entitled to have it and he merely retained it. He admitted the accidental use of the Labour Database and the limited use as described of the Document Library. He denied any other use. His affidavit of 10th March, 2014, (intended to stand as his evidence in chief at trial) was to like effect on this aspect.
12. On 2nd September, 2011, a mediation took place between the parties to see if the dispute could be settled. The mediator was Mr Michel Kallipetis QC. Mr Kilbey attended together with Advocate Renouf. For the other side, Mr Baker and Mr Jones were both present together with two representatives of the firm of advocates then representing them.
13. In preparation for the mediation the parties entered into a mediation agreement which was governed by English law. The relevant provisions of that agreement for present purposes are as follows:-
"Confidentiality and Privilege
12. The Parties and the Mediator shall:-
12.1 keep confidential and regard as privileged, and shall not use, any information of any nature produced for, or arising in connection with, the Mediation save:-
as may be necessary to implement and/or enforce any settlement agreement and/or;
as may be required by law and/or;
to professional advisors if strictly necessary and for bona fide reasons, and on the basis that the recipient is informed of the confidentiality of the information and agrees to maintain that confidentiality
12.2 keep confidential and regard as privileged, and shall not use what happened and what was said at the Mediation and the terms of any settlement (unless the settlement agreement has its own confidentiality terms in which case those terms will prevail).
13. Each Party shall ensure that all those present at the Mediation on its behalf and any person in receipt of confidential and/or privileged information arising out of, or in connection with, the Mediation from that Party shall agree to be bound by clause 12 of this agreement.
14. All documents, correspondence or information (in any format ) produced for, arising out of, or in connection with, the Mediation will be treated as privileged, and shall not be admissible as evidence or be disclosable in any proceedings connected in any way with the subject matter of the Dispute, unless such documents or information would have been admissible or disclosable in any event.
15. No formal record or transcript of the Mediation shall be made."
14. In accordance with clause 15, there is no record or transcript of what was said at the mediation. However, on 15th May, 2014, Mr Baker swore an affidavit in support of the present application in which he refers to some of what happened at the mediation. He says that at the beginning, the mediator invited each party to make an opening statement and he was invited to speak first. He says that he began by setting out the history of the matter concerning Mr Kilbey's involvement with Grafters and the deterioration of the relationship between them. He explained how Mr Kilbey, after leaving Grafters, had set up a competing business and he also began to explain the issues concerning the Data Protection Commissioner and that Mr Kilbey had taken data belonging to Grafters before he left the company. He goes on to say in his affidavit that, as he was speaking, Mr Kilbey interrupted him and made a number of comments. He says that he (Mr Baker) stopped talking and Advocate Renouf suggested to Mr Kilbey that he let Mr Baker finish speaking. He says that despite this Mr Kilbey continued talking and became very animated and agitated. Mr Kilbey then said "Of course I took the data and used it ...". He also said "I have done everything I can to destroy the business and to destroy you (pointing at Mr Baker)". Mr Baker goes on in his affidavit to say that Mr Kallipetis asked Mr Kilbey to think about what he was saying and Advocate Renouf also told him not to say anything further. Despite this Mr Kilbey continued and said words to the effect "There is nothing you can do about it".
15. Mr Jones has also sworn an affidavit dated June 2014. He explains that he has been asked to recall the events of the mediation. He confirms that, whilst the Grafters' side was giving their overview of the case, Mr Kilbey became visibly agitated and aggressive. He said, in an aggressive manner, that he had taken the data from Grafters and that he had used it. Mr Jones says that there is no doubt in his mind that Mr Kilbey specifically said this. He went on to say that, after being interrupted by his lawyer and being advised not to say anything more, Mr Kilbey continued talking and although Mr Jones cannot recall his exact words, he recalls it being along the lines of him (Mr Kilbey) having used it (the data) as ammunition against James Baker. He reports that the two representatives from the legal firm representing Grafters at that time apparently also can recall Mr Kilbey saying that he had taken the Grafters data and used it but there is no evidence from those lawyers directly before the Court.
16. The Respondents apply for permission to adduce evidence at trial of what they say Mr Kilbey said at that mediation.
17. It is common ground that, quite apart from the express terms of the mediation agreement, a mediation falls to be treated as a without prejudice meeting. Accordingly, anything said at a mediation is inadmissible at trial subject only to certain exceptions. One of the exceptions is if exclusion of the evidence would act as a cloak for perjury, blackmail or other unambiguous impropriety.
18. Advocate Blakeley argues that the facts of this case fall within that exception. Mr Kilbey admitted at the meeting that he had used the data. In his affidavits and in his pleading, he denies that. He has therefore committed perjury in his affidavits and would do so at trial if he gives evidence in accordance with his pleaded case. It is a case of perjury or other unambiguous impropriety.
19. Advocate Renouf, on the other hand, submits that, for the exception to apply, there must be some abuse of the without prejudice position e.g. where a party uses the occasion to make threats of blackmail. A mere assertion that is inconsistent with a pleaded case or an affidavit is not sufficient.
20. In response, Advocate Blakeley submits that, if this is indeed the position under English law, I should declare Jersey law to be different. In particular, I should hold that the importance of without prejudice discussions should not trump the need for parties to tell the truth.
21. I was not referred to any Jersey authority which helps on the point which I have to decide. Both counsel therefore referred to the leading English authorities. In my judgment, they were correct to do so. The general nature of litigation in Jersey is very similar to that in England. It follows that the policy considerations which give rise to the rule concerning without prejudice negotiations in England are likely to be similar in this jurisdiction.
22. The general rule is that anything said or written in the course of without prejudice negotiations is not admissible in evidence at the trial of the action. The reason for the rule is essentially one of public policy in encouraging parties to settle litigation. Thus in Cutts v Head  Ch 290, Oliver LJ said at 306:-
"That the rule rests, at least in part, upon public policy is clear from many authorities, and the convenient starting point of the inquiry is the nature of the underlying policy. It is that parties should be encouraged so far as possible to settle their disputes without resort to litigation and should not be discouraged by the knowledge that anything that is said in the course of such negotiations ... may be used to their prejudice in the course of the proceedings. They should ... be encouraged fully and frankly to put their cards on the table ... The public policy justification, in truth, essentially rests on the desirability of preventing statements or offers made in the course of negotiations for settlements being brought before the court of trial as admissions on the question of liability."
23. It has nevertheless always been understood that there are some exceptions to the rule. An obvious example is where the without prejudice negotiations are said to have resulted in a binding agreement. The Court will then hear evidence as to whether or not that is the case. In the case of Unilever PLC v Proctor and Gamble Company  1 WLR 2436, Robert Walker LJ listed some of the most important exceptions to the rule and included the following as his fourth exception at 2444G:-
"(4) Apart from any concluded contact or estoppel, one party may be allowed to give evidence of what the other said or wrote in without prejudice negotiations if the exclusion of the evidence would act as a cloak for perjury, blackmail or other 'unambiguous impropriety' (the expression used by Hoffmann LJ in Forster v Friedland 10 November 1992 Court of Appeal (Civil Division) Transcript No. 1052 of 1992). The examples ... are two first-instance decisions, Finch v Wilson unreported (8 May 1987) and Hawick Jersey International v Caplan (the Times 11 March 1988). But this court has, in Forster v Friedland and Fazil-Alizadeh v Nikbin, (unreported) 25 February 1993, Court of Appeal (Civil Division) Transcript No. 205 of 1993, warned that the exception should be applied only in the clearest cases of abuse of a privileged occasion."
It is the extent of this exception which is before me in this case.
24. It is worth looking at the context in which Hoffmann LJ made his remark in Forster v Friedland 10th November, 1992 (Civil Division) Transcript No 1052 of 1992. The facts in that case were that, in the course of without prejudice discussions, Mr Friedland stated that he regarded himself as bound in honour to acquire certain shares at an agreed price but said that if it came to litigation he would deny that there was any legally binding agreement. The other side sought to adduce the evidence of these discussions on the ground, amongst others, that they showed that Mr Friedland was threatening to advance what he knew to be a sham defence, namely that there had been no agreement whether legally binding or not. Hoffmann LJ said:-
"I accept that a party whether plaintiff or defendant, cannot use the without prejudice rule as a cloak for blackmail."
He then considered two cases (referred to in the passage from Robert Walker LJ above) where this had been the case and went on to say:-
"These [i.e. the two cases] are clear cases of improper threats, but the value of the without prejudice rule would be seriously impaired if its protection could be removed for anything less than unambiguous impropriety. The rule is designed to encourage parties to express themselves freely and without inhibition. I think it is quite wrong for the tape recorded words of a layman, who has used colourful or even exaggerated language, to be picked over in order to support an argument that he intends to raise defences which he does not really believe to be true."
He went on to find that this was not a case of blackmail because Mr Friedland was simply making it clear that he considered there to be no legally binding agreement even if he had been honour bound to acquire the shares.
25. In the Unilever case Robert Walker LJ summarised the position at 2448H as follows:-
"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 ... '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." [emphasis added]
26. In Berry Trade Limited v Moussavi  EWCA Civ 715 the claimants Berry Trade sought to adduce in evidence certain statements alleged to have been made by one of the defendants Mr Ghadimi at three without prejudice meetings. It was said that these admissions demonstrated that his defence and counterclaim were dishonest. The defendant denied some of the remarks attributed to him and contended that, at its highest, this was a case of an inconsistency between what was pleaded in his defence and counterclaim and what was said by him in the without prejudice discussions. It therefore fell far short of being an impropriety that would justify the lifting of the privilege. The Court of Appeal held that this was not a case of unambiguous impropriety. At para 50 Peter Gibson LJ said:-
"There is a plain inconsistency between that omission from the discussions and the pleading; but a mere inconsistency, as the cases show, is not sufficient to amount to unambiguous impropriety. What has to appear very clearly from the evidence is that Mr Ghadimi is guilty of perjury in signing the statement of truth as to his belief in the truth of the pleaded facts and in deposing to the sum claimed in the counterclaim as owed to him. ..."
27. Later at paragraph 53 Peter Gibson LJ summarised the position as follows:-
"... It seems to us quite wrong to select from many hours of without prejudice discussions what is said to be an admission here and an admission there in order to mount a claim that by his subsequent statements on oath the alleged maker of the admissions committed perjury. These were not even discussions at which, through tape-recording or the keeping of a detailed note, what was said and the context in which it was said could not be doubted. If the without prejudice rule can be breached in this case, we do not see why it cannot be breached in any case where an admission, inconsistent with some pleading or sworn assertion is alleged to have been made. No litigant could be advised to enter into without prejudice discussions without a lawyer at his elbow or a prepared script approved by his lawyer. To allow such admissions in evidence flies in the face of the public policy justification for the without prejudice rule." [emphasis added]
28. Finally I would refer to Savings and Investment Bank Limited (in liquidation) v Fincken  EWCA Civ 1630, another decision of the English Court of Appeal. The background to the case was that Mr Fincken owed the plaintiff bank a sum of money and the liquidators were seeking to recover it. Mr Fincken swore an affidavit of means in which it was said that he had misrepresented his assets by omitting shares in and loans to a particular company. That was apparently repeated at an interview with the liquidators. The liquidators sought to amend the bank's claim in subsequent proceedings against Mr Fincken so as to include an allegation of non-disclosure in respect of the shares and loan and to rely upon what was said to be an admission in a without prejudice meeting that the shares were held by another as his nominee. Mr Fincken did not produce any evidence about what was said at the without prejudice meeting.
29. The judge at first instance allowed the amendment on the basis that evidence of the without prejudice discussions could be admitted. The Court of Appeal overturned his decision. Rix LJ conducted a detailed review of the cases and the law at paragraphs 38 - 63 of his judgment which are worthy of detailed study. The contentions before the Court of Appeal were clear. On behalf of the bank, it was contended that if the admission proved a lie in a previous sworn statement, that was sufficient. The public policy which protected without prejudice negotiations did not or should not extend to cover what would be a fundamentally dishonest approach to an earlier affidavit and thus to the conduct of the defence. In the tension between the public interest in the protection of without prejudice negotiations and the separate public interest in the honest and due administration of justice, the former should give way to the latter; otherwise the privilege is used as a cloak for perjury.
30. On behalf of Mr Fincken, on the other hand, it was submitted that, before what was said could be admitted in evidence, the occasion of the without prejudice discussions needed itself to be an abuse of the privilege generally afforded to such discussions. Examples of such abuse found in the authorities were the issuing of threats at the without prejudice meeting to persevere in admittedly dishonest litigation and threats described in terms of blackmail etc. If, however, a mere admission were enough, then the exception would not merely erode but overwhelm the rule.
31. The Court of Appeal ultimately sided with Mr Fincken and I would quote the following paragraphs from the judgment of Rix LJ (supported by Carnwath LJ) as establishing the position at English law:-
"56. These considerations throw into relief the fact that SIB's evidence has gone unchallenged. How important is that factor in the present context? In my judgment, the court ought to treat it with considerable caution, for otherwise there is a danger of the exception to the rule displacing the rule by a process of begging the question. If the exception applies, then Mr Fincken is obliged to explain himself or face the consequences, for his admission is in the public domain. The absence of challenge may therefore be critical. If, however, the exception does not apply, then the admission is not in the public domain, the court ought not to know about it, and the absence of challenge is irrelevant. Moreover, there may be many reasons why someone in Mr Fincken's position may at the stage of SIB's application be cautious about responding to an issue (his ownership of the shares) which was not yet even part of the litigation. He is accused of perjury, but not on any formal charge and not on a matter even formally in issue. I can see that the absence of challenge may enable an applicant to establish more easily that an alleged admission is unequivocal. That, however, is not the same thing as an unequivocal or unambiguous impropriety. I would therefore be reluctant to find in the circumstances that an absence of challenge is a critical factor taking this case outside the philosophy of the jurisprudence expressed in the leading authorities cited above.
57. In my judgment that philosophy is antagonistic to treating an admission in without prejudice negotiations as tantamount to an impropriety unless the privilege is itself abused. That, it seems to me, is what Robert Walker LJ meant in Unilever when he repeatedly spoke in terms of the abuse of a privileged occasion, or of the abuse of the protection of the rule of privilege; see at 2444G 2448A and 2449B. That is why Hoffmann LJ in Forster emphasised that it was the use of the privileged occasion to make a threat in the nature of blackmail that was, if unequivocally proved, unacceptable under the label of an unambiguous impropriety. And that is why Peter Gibson LJ in Berry Trade suggested, without having to decide, that talk of 'a cloak for perjury' was itself intended to refer to a blackmailing threat of perjury, as in Greenwood v Fitt, rather than to an admission in itself. It is not the mere inconsistency between an admission and a pleaded case or a stated position, with the mere possibility that such a case or position, if persisted in, may lead to perjury, that loses the admitting party the protection of the privilege (see the first holding in Fazil-Alizadeh, described at para 47 above). It is the fact that the privilege is itself abused that does so. It is not an abuse of the privilege to tell the truth, even where the truth is contrary to one's case. That, after all, is what the without prejudice rule is all about, to encourage parties to speak frankly to one another in aid of reaching a settlement; and the public interest in that rule is very great and not to be sacrificed save in truly exceptional and needy circumstances.
58. It may be said, as indeed Ms Gloster has powerfully argued, that even if the mere possibility of future perjury does not suffice to destroy the privilege, the admission which demonstrates that perjury has been committed in the past, by reference to an existing affidavit, is or should be different and that no authority suggests otherwise. In this way she seeks to support the judge's decision, which was premised on the prospect of future perjury, as was the decision in Merrill Lynch, by the different route of the impropriety of past perjury. There is indeed a substantial case to be made that the courts should not pass by such proof of perjury with indifference. There is a clear public interest in the discouragement of perjury. Nevertheless, on balance I do not think that the court should adopt such a position. If they did, the very serious and criminal charge of perjury would fall to be debated, without the protection which should be available to the accused party, on an interlocutory outing (as here) or even a trial, with the potential of derailing the trial by the exposure of without prejudice material to the trial judge. Essentially the same problem would arise in connection with statements of truth, which now apply under the CPR to all particulars of claim or defence; although they cannot give rise to the offence of perjury, they can give rise to the only relatively less serious matter of contempt of court. ...
62. It is of course distasteful for this or any court to avert its eyes from an admission which, subject to any point about value, appears to incriminate Mr Fincken in lying in a sworn document. However, in the tension between two powerful public interests, it seems to me that that in favour of the protection of the privilege of without prejudice discussions holds sway - unless the privilege is itself abused on the occasion of its exercise."
32. Advocate Blakeley concedes that, if Jersey law is to like effect as that stated by the English Court of Appeal in Fincken, he faces an uphill struggle in bringing himself within the exception. Nevertheless, he submits that he can do so.
33. He argues that the statements made by Mr Kilbey were not made for the purposes of an honest discussion seeking settlement by conceding points. Mr Kilbey was not confessing in order to enable settlement negotiations to proceed. His statements were not made to assist in reaching a settlement or to demonstrate that he was approaching the discussions openly and honestly. On the contrary, he made the comments merely to argue against Mr Baker and perhaps to taunt him. Far from assisting in settlement, they were apt to destroy the possibility of achieving a settlement. It was in effect simply point scoring. That was to use the privilege for a purpose other than to try and settle the case and therefore it was an abuse of the occasion of privilege.
34. I cannot accept this argument. This was a mediation held by an experienced mediator with the advocates for both parties present. The purpose of the meeting was clearly to try and settle the case even if it turned out in the end to be unsuccessful. During the course of a mediation, all sorts of things will be said at different stages. At one stage, a party may seek to be very conciliatory and concede that its case is weak or wrong; at other times it may seek to assert the strength of its case in order to convince the other side that they are bound to lose.
35. In my judgment it would be completely contrary to the public policy behind the privilege for particular comments to be identified and for it then to be argued that those particular comments were not made for the purposes of seeking to achieve a settlement and are therefore not subject to the privilege. I cannot improve on the language used in two of the English cases. In Forster Hoffmann LJ said:-
"I think it is quite wrong for the tape-recorded words of a layman, who has used colourful or even exaggerated language, to be picked over in order to support an argument that he intends to raise defences which he does not really believe to be true."
36. And in Unilever, Robert Walker LJ said at 2443-4:-
"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. This is particularly true where the without prejudice communications in question consist not of letters or other written documents but of wide-ranging unscripted discussions during a meeting which may have lasted several hours.
At a meeting of that sort the discussions between the parties' representatives may contain a mixture of admissions and half-admissions against a party's interest, more or less confident assertions of a party's case, offers, counter-offers and statements (which might be characterised as threats or thinking aloud) about future plans and possibilities, ... . Partial disclosure of the minutes of such a meeting may be ... a concept as implausible as the curate's egg (which was good in parts)."
37. In my judgment, there is no evidence here of misuse or abuse of the privilege itself. This is a simple case of, on Mr Baker's evidence, Mr Kilbey saying something inconsistent during the mediation with what he has said in his pleadings and on affidavit. On the English authorities, that is not sufficient.
38. Furthermore, I am in any event not convinced that the inconsistency is as great as Advocate Blakeley asserts. The case is put very much on the basis that Mr Kilbey admitted using the data at the mediation but denies using it in the pleadings and his affidavits. In fact his pleadings are somewhat more nuanced. It is correct that, in his pleading, he denies using the Customer Database or the Accounting Data at all. However, he admits that on one occasion the Labour Database was accidentally used and he accepts that the Document Library was used. Be that as it may, I do not consider that, on the facts, this constitutes an abuse of the occasion of privilege as envisaged by the authorities and therefore, on the basis of English law, the evidence of what was said at the mediation is not admissible.
39. But Advocate Blakeley has a second string to his bow. He says that, even I am against him on the test as applied in England, I should declare Jersey law to be different. He associates himself with the submissions on behalf of the bank in Fincken summarised at para 29 above. He says that the Court should not countenance perjury and that, in a conflict between that and the need to encourage settlement, the former should prevail.
40. I certainly see the force of that argument. However, I am persuaded that it should be rejected. I would summarise my reasons as follows:-
(i) I consider the public interest in encouraging settlement to be extremely strong. Litigation is very expensive and even the eventual winner may find himself out of pocket. Litigation to the bitter end can often cause real hardship. It is therefore in the interests of justice that parties should be encouraged to settle their differences at as early a stage as possible.
(ii) If without prejudice negotiations are to be successful, the parties (and their advisors) must be confident that they can lay all their cards on the table without fear of something they say coming back to bite them later. The process of settlement is aided by open and frank discussion of both the good points and the bad points of each side's case. This process will be hindered if the parties must monitor everything they say (with their lawyers as their minders) in case something is said which is inconsistent with what has been stated previously (whether in pleadings or in an affidavit). I would refer in this respect to the emphasised passages from Unilever and Berry Trade quoted at paras 25 and 27 above.
(iii) If the exceptions to the rule are widened, parties will have great difficulty in ascertaining when the privilege will be lost and when it will not. As Simon Brown LJ said in Fazil-Alizadeh:-
"There are in my judgment powerful policy reasons for admitting evidence as exceptions to the without prejudice rule only in the very clearest cases. Unless this highly beneficial rule is most scrupulously and jealously protected, it will all too readily become eroded."
(iv) If the exception is widened as Advocate Blakeley submits, there is a great risk of collateral litigation. Take this particular case. There is no contemporary note or record of what was said at the mediation. Mr Baker's affidavit is dated March 2014, some two and a half years after the event. He is therefore having to recall not only exactly what was said that long ago but also the context in which it was said. There is considerable scope for errors in recollection. Furthermore, although Mr Kilbey has not put in any evidence, Advocate Renouf asserted on his behalf that the Respondents' evidence of what went on in the mediation is highly misleading. There is therefore considerable scope for collateral litigation about what was or was not said and what it meant. Advocate Blakeley argued that the Court should concern itself simply with whether the remark, if said, amounted to unambiguous impropriety and then leave the judge to resolve the facts. But this would result in evidence of what was said at a without prejudice occasion often being admitted on the strength of a mere assertion and the consequent erosion of the sanctity of the privilege (with consequent adverse effect on how effective without prejudice discussions would be in the long run).
(v) Given the similarity of the way in which litigation is conducted in England and Jersey, it seems to me that the public policy arguments which have repeatedly proved persuasive in the English Court of Appeal and which are set out in the passages quoted earlier in this judgment are equally applicable in this jurisdiction.
(vi) Whilst it was not argued in this case that there should be any special form of privilege for what is said at a mediation beyond the normal without prejudice privilege, it is the policy of the Court to encourage mediation to assist parties to settle cases wherever possible. The policy arguments referred to above therefore apply with full if not great force to mediations. If mediations are to be successful in achieving their objective, the parties must be confident that they can speak freely and openly without fear that what they say may come back to prejudice them should the litigation continue.
(vii) Ultimately, I cannot improve on what is said in Hollander, Documentary Evidence (11th edition), at para 20 - 26 as follows:-
"There will always be applications to admit without prejudice evidence on the grounds of 'unambiguous impropriety'. Where a party says one thing at a without prejudice meeting, it sticks in the throat to permit him to say something quite different in a witness statement or in evidence without trying to adduce evidence of what he told everyone at the without prejudice meeting or in without prejudice correspondence. But, as the court recognised in Fincken there are serious risks in undermining the willingness of parties to communicate without prejudice in an effort to settle their differences if the "unambiguous impropriety" exception is implied in other than the most egregious cases, and most of the time, public policy will trump the outrage felt by those who have been told a rather different story on a without prejudice basis."
41. For these reasons I hold that Jersey law is to like effect as English law in these respects and that the unambiguous impropriety exception must be narrowly construed for the reasons described in the various cases, including Fincken.
42. Advocate Blakeley had two final arguments to raise even if he was unsuccessful on his principal ones. He pointed out that the Respondents were seeking an equitable remedy as they were asking for an account. He emphasised that those who come to a court of equity seeking its assistance must do so with clean hands. Should not the same apply to a defendant to an equitable claim? If the statements made by Mr Kilbey at the mediation were not allowed into evidence then the Court, wearing its equity hat, would be standing by and allowing inequity against those who seek its assistance.
43. He also pointed out that when Mr Kilbey commenced his proceedings, he asked for an injunction which was granted. Erroneously, the Court did not demand an affidavit in support. Subsequently it did so and ordered that Mr Kilbey file an affidavit. In that affidavit he made no mention of the investigation by the Data Protection Commissioner. Advocate Blakeley argued that Mr Kilbey had abused the process of the Court in that he had not given full and frank disclosure in his affidavit and indeed had not told the truth. That was an additional reason why the Court should insist that what was said at the mediation should be admitted.
44. I do not think that either of these points take Advocate Blakeley any further. The fact is that there is a rule that without prejudice discussions are inadmissible unless they can be brought within one of the exceptions. Neither of the two points which he makes are an established exception and, for the reasons referred to earlier, I agree with the English judges that the Court should be very wary of making any new exemptions or widening the existing exceptions to the rule. The Respondents cannot bring themselves within any of the existing exceptions and I decline to introduce any new ones along the lines suggested by Advocate Blakeley in these additional arguments.
45. For the reasons set out above, I rejected the Respondents' application to allow evidence of what was said at the mediation to be admitted at trial.
Cutts v Head  Ch 290.
Forster v Friedland 10 November 1992 Court of Appeal (Civil Division) Transcript No. 1052 of 1992.
Berry Trade Limited v Moussavi  EWCA Civ 715.
Savings and Investment Bank Limited (in liquidation) v Fincken  EWCA Civ 1630.
Hollander, Documentary Evidence 11th Edition.