As noted in previous editions of “Industry Insights” (eg, August and September 2016), disputes regarding without prejudice communications are not uncommon in Hong Kong – a jurisdiction that has traditionally taken a commendably expansive view of the “privilege” (in line with common law privileges generally), while accepting that the protection is not without limits.
The strong public policy reasons that underpin the protection of without prejudice privilege should also apply to communications made in good faith during or as part of a court or tribunal facilitated dispute resolution process. Such communications are not (in the main) covered by the protection given to “mediation communications” in the Mediation Ordinance (Cap. 620*).
In the recent case of AB v MAW  HKEC 2597, CACV 147/2016, an issue arose as to whether a Family Court judge (and, in this case, an experienced specialist at that) who had presided over a financial dispute resolution (“FDR”) hearing (pursuant to Practice Direction 15.11**) was entitled to deal with a reserved costs order arising out of an interlocutory application that she had heard before the FDR hearing.
While the Practice Direction makes it clear (at para. 8(b)) that a judge conducting a FDR hearing “shall have no further involvement with the Application, other than to conduct any further FDR hearing”, the judge in this case still saw fit to propose that she deal with the reserved costs after the unsuccessful FDR. Given the important point of principle involved, the judge granted the husband permission to appeal.
In its judgment the Court of Appeal emphatically decided that, in addition to para. 8(b) of the Practice Direction, the protection of without prejudice privilege and confidentiality prevented a judge who presided over a FDR hearing from having further involvement with any contested application in the proceedings, including costs disputes. The Court of Appeal’s reasoning applies equally if the judge is unable to recollect what had passed during the FDR hearing.
While one can see some merit in a judge in such circumstances presiding over an issue of reserved costs after a FDR hearing, the judgment of the Court of Appeal is underpinned by good policy reasons that go to the heart of the wide protection of the without prejudice rule (which is more a rule of evidence).
The Court of Appeal’s reasoning also has a wider general application to contested interlocutory applications and, in this respect, is not fact dependent. For example, a party who asserts without prejudice protection should not have to demonstrate how the admission in evidence of a without prejudice statement might be detrimental to his or her interests.
As we enter a new year, common law privileges are in a good place in Hong Kong and the hope (and resolution) is that things stay this way.
* Also see Schedule 1 of the Ordinance.
** “Financial Dispute Resolution Pilot Scheme”.