Alternative Dispute Resolution (ADR): California Statutes, Public Policy, and Agreement –Part I: Mediation Confidentiality

Posted in: Alternative Dispute Resolution by Steven Vartabedian on

Welcome to the inaugural posting of the California Appellate Lawyer Blog, presented by the Appellate Practice Group of Dowling Aaron Incorporated, Inc. This is Steve Vartabedian, recently retired from the bench, having spent 21 years on the California Court of Appeal which followed 8 years on the trial court. From time to time, I, and other attorneys at Dowling Aaron Incorporated, will be addressing matters such as recent appellate opinions, appellate practice, and trial practice issues aimed at protecting clients’ appellate rights. I also participate in Dowling Aaron Incorporated’s ADR Group, performing mediations and arbitrations. So I thought I would comment in my first two posts on two recent cases concerning ADR proceedings.

This first post is about mediation confidentiality and the California Supreme Court opinion in Cassel v. Superior Court (filed January 13, 2011) 2011 DJDAR 658. Evidently in this case, the mediation client felt that his attorney did not fairly achieve an agreement with the client in the settlement reached with the opposing party. The opinion does not tell us whether the settlement agreement was attacked in the trial court. We do know that client sued attorney for malpractice claiming counsel gave him bad advice, deceived and coerced him, and did so based on a conflict of interests. The client claimed he was induced into settle for a lower amount than the case was worth and lower than what client had communicated he was willing to accept.

The malpractice action reached the Supreme Court. In his defense at trial, attorney moved in limine to exclude ALL evidence of communications between him and client (plaintiff) that were related to the mediation, including pre-mediation discussions. The trial court granted the motion. On mandate petition, the Court of Appeal majority granted relief to plaintiff, finding that because defendant is free of his attorney-client privilege in defending the malpractice action, he cannot use mediation confidentiality as a shield in that action–that to do so would allow him to unfairly hamper the proof of malpractice against him.

The Supreme Court majority sympathized with the view of the appellate court majority, but determined the plain language of the statute (California Evidence Code section 1119) compels the exclusion of evidence of confidential mediation communications–this confidentiality is not limited to those between the disputants. Concurring Justice Chin agreed in the result; however he was not completely satisfied that the legislature fully considered whether attorneys should be shielded from accountability and urged the legislature to act.

I suppose accountability in this situation includes assuring that the client’s mind meets with that of counsel and with that of the opposing side in the mediation, and in protecting against settlements based on coercion and/or misrepresentations made by an attorney to his client. An additional point might be that unless there is legislative change, attorneys may have a reason to get a case with a difficult client into mediation: should one get sued for malpractice, one can get potentially damaging evidence excluded. I am a strong proponent of mediation, but I hope this does not become a reason to mediate.

In my next post, I will talk about another question of minds meeting, but a very different type of issue concerning ADR: avoidance of a covenant to arbitrate.

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