When a UK court stays proceedings to enable mediation to take place and a settlement is reached, the parties may choose to keep the terms of their agreement confidential and not disclose them to the court. This is known as a ‘private settlement.’
In this situation, the parties can request that the court record a consent order stating that the proceedings have been stayed and that the parties have reached a private settlement agreement. The order will not contain any details of the settlement agreement, and the court will not be informed of the terms of the settlement.
The parties will be required to sign the consent order, and it will be submitted to the court. The order will be a public document, but it will not contain any information about the terms of the settlement.
It is important to note that if the parties breach the terms of their private settlement agreement, the other party can apply to the court to have the stay lifted, and the case will be reactivated. If the settlement agreement is breached, the party who has suffered a loss may also be able to sue for breach of contract.
In conclusion, if parties reach a private settlement agreement after a court stays proceedings to enable mediation to take place, the terms of the agreement can be kept confidential and not disclosed to the court. A consent order can be submitted to the court, stating that the proceedings have been stayed and that the parties have reached a private settlement agreement. However, it is important to ensure that the terms of the settlement agreement are clear and that both parties fully understand their obligations before signing the agreement to avoid potential breaches and legal consequences.
In addition to a consent order, parties in the UK may also use a non-disclosure agreement (NDA) or a confidentiality agreement to keep the terms of their settlement agreement private.
An NDA is a legal contract between the parties that outlines the confidential information that will be shared between them and the terms and conditions of the confidentiality. This type of agreement is commonly used in commercial transactions, but it can also be used in the context of settlement agreements reached through mediation.
A confidentiality agreement is similar to an NDA, but it is typically used to protect confidential information disclosed during mediation. This type of agreement is often used when parties want to encourage open and honest communication during mediation without the fear that anything they say will be used against them in court.
Both NDAs and confidentiality agreements can be useful tools to protect the confidentiality of settlement agreements reached through mediation, particularly in situations where the parties do not want the court to know the terms of the agreement. However, it is important to ensure that the terms of the agreement are clear, and that both parties fully understand their obligations before signing the agreement.