Changes In Mediation Confidentially
Edited by Judith Stalk
The underlying tenet of mediation is the knowledge by all participants that what is said and written expressly for a mediation may not be discussed outside the mediation. The statements and documents are not later subject to examination in the dispute, nor in any subsequent proceeding. Yet, in three recent cases mediators have been compelled to testify or have provided a report of the content or conduct of a mediation. What is happening to mediation confidentiality and what can attorneys anticipate in the near future?
Recent Court Decisions Effecting Mediation Confidentiality
Several new exceptions to the prohibition of disclosing discussions and writings during mediations have been created.
In Olam v. Congress Mortgage Company, 68 F.Supp.2d 1110 (Oct. 15, 1999), the mediator was compelled to testify, first in camera, then in open court, as to the mediator’s perceptions of a party’s capacity to sign the settlement agreement, in view of the events leading up to the signing.In an unusually lengthy, analytical and carefully worded opinion, (one which its author instinctively knew would be the subject of appeal and endless analysis) the U.S. District Magistrate Judge hearing the case determined that both parties had validly waived the privilege of having the mediation proceedings held confidential. The judge also assumed that the mediator would raise his separate privilege under California Ev. Code 703.5  to withhold information regarding the mediation, but in this instance the mediator could none-the-less be compelled to testify despite that privilege.
In considering whether to compel the mediator to testify, the court was guided in part by the balancing of interests requirement set forth in Rinaker v. Superior Court, 62 Cal.App.4th 155, 74 Cal.Rptr.2d 464 (3d Dist. 1998). One of the balancing standards of Rinaker requires the court to consider: whether the value of the mediator’s testimony would outweigh the values and interests that would be harmed if the mediator were compelled to testify. After first taking testimony of the mediator in camera, the Olam court justified the open court testimony of the mediator by determining “the parties to the mediation have waived confidentiality protections, indeed have asked the court to compel the mediator to testify… If a party to the mediation were objecting to compelling the mediator to testify we would be faced with a substantially more difficult analysis.” (at page 1133).
In Foxgate Homeowners’ Association, Inc v. Bramalea California, Inc, 78 Cal.App.4th 653; 92 Cal.Rptr.2d 916 (Feb. 25, 2000), the trial court ordered sanctions against the defendants for failing to bring expert witnesses as required during the court-ordered mediation. The court had considered the report of the mediator along with the moving attorney’s declarations of statements made during the mediation. The mediator was a retired superior court judge who also served as discovery special master on this construction defect dispute. The trial court concluded “Because the court would have no way of learning that its orders [as ordered by the special master that all parties and their expert witnesses be present at the mediation] had been disobeyed or that some serious misconduct occurred which warrants judicial oversight, the court would be stripped of its inherent power to police and control its own processes. . . The exceptions we craft here are narrow ones, however. The courts, counsel and mediators are warned that only such information as is reasonably necessary should be put before the court.” (Pgs 669-670.) On May 17, 2000, the California Supreme Court granted review of this decision.
How Will Foxgate and Olam Effect Future Mediations?
A narrow interpretation of Olam might limit mediator testimony to those circumstances in which all parties have both specifically waived their rights to the confidentiality afforded by statute, and have requested the trial court to order the mediator to testify. However, as the court noted, left open is the issue, possibly among others, what if one of the parties objected to the mediator testifying? What if Olam is interpreted more broadly? Will there be a “common exception” of mediation confidentiality when one of the parties seeks to enforce the settlement agreement and the other party does not? That is what happened in Olam. Could such an exception eventually become codified by the legislature? There already are limited exceptions to Evidence Code section 703.5 (see end note 2) and section 1117
Foxgate may have been unusual in that the neutral served as both mediator and discovery special master in a court ordered mediation. The neutral, a retired judge, who was more than a little disgruntled that one of the counsel appeared at the court ordered mediation without his client and experts, did not raise the Evidence Code section 703.5 bar to a mediator testifying. The court considered Evidence Code section 1121 which provides that neither a mediator nor any one else may submit to court a report of any kind concerning what happened at the mediation, unless all parties expressly agree in writing. However, a discovery special master may be required by Code of Civil Procedure Section 639 to file a report and recommendation to the court. Is the neutral who is both mediator and special master destined to be placed in a position of conflict as a result of these several code sections? The unavoidable conflict arises when the neutral is required by CCP section 639 to make a recommendation to the court, but may be in violation of EvC section 1121 when the report and recommendation reveals any of the substance of the mediation or favors one party over the other.
The courts are interested in bringing cases to resolution, most preferably before trial. When this issue of a possible exception to mediation confidentiality moves to the legislature, will the legislature be more supportive of a public policy which favors the resolution of disputes before trial and allow the limited setting aside of mediation confidentiality to serve that purpose, or will the legislature support a public policy of “iron clad” mediation confidentiality?
My guess is there will be continued challenges to mediation confidentiality, the legislature will promulgate exceptions, and there may be more challenges to the statutory changes. The process, as we know it, is still young and evolving.
What Are Attorney’s Choices Now?
Consider avoiding court ordered mediation by mediating before the court orders it. Consider separate neutrals, one as mediator and the other as special master. Consider not setting your self up for the accusation of not participating in good faith.
At the end of the mediation when the parties and counsel sign the settlement agreement or letter of intent, make sure the document is inclusive of all terms and deal points, and reflects the needs of all the parties. There will be less likelihood for one party or counsel, or the other, to attempt to set the settlement aside later.
Neither Foxgate nor Olam addressed the issue of ordering the mediator to testify as to the content of private caucus sessions. Therefore, though some mediation/trial counsel may be more guarded in the joint session of the mediation with the opposition present, it appears that counsel and parties, presently, are still protected by the public policy protection of confidentiality during the private caucus sessions.
How Have Foxgate and Olam Changed Fisher’s Mediation Procedures?
All participants to a mediation, including parties, attorneys, expert witnesses, carrier representatives, and every body else present must sign a stipulation incorporating California Evidence Code 1119 et seq.
The stipulation further provides that if Fisher is called to testify or provide a report, the court will order the requesting party to pay all of Fisher’s attorney fees, costs and his usual rate for all preparation, travel, and related costs.
Though section 1119 is enforceable whether or not such a stipulation is signed by the participants to the mediation, the act of signing reinforces the importance and requirement of non-disclosure, and binds the participants to at least some financial burden if the neutral is called to testify. These efforts are intended to be a deterrent to subpoenaing the mediator to testify.
Take Part in the Debate, Respond to this Important Survey
Your feedback is valuable. The law of mediation confidentiality is evolving. Though five years from now we may look back on this time and wonder what all the shouting (muffling?) was about, today these are vital issues. Evolution is both painful and developmental, and will hopefully lead to growth and an improved process.
Take part in the evolutionary process by providing your comments to these questions:
Do you prefer “iron clad” confidentiality, or the ability to set confidentiality aside under certain circumstances?
If you do not prefer “iron clad” confidentiality, under what circumstances would you allow the mediator to testify or provide a report to the court?
What deterrents to calling the parties and mediator to testify would you suggest? What would you think if the stipulation setting forth Ev C section 1119, as outlined above, were expanded to provide that the party seeking to compel the mediator to testify could also be compelled by the court to pay the other party’s attorney fees and costs?
How will the Foxgate and Olam decisions effect the way you participate in voluntary (party initiated) mediation? In a court ordered mediation? During the pre mediation conferences? During the settlement agreement drafting stage? In post mediation discussions?
Do you want to see anything different from your mediator as a result of Foxgate and Olam?
Your response will be presented in a future issue of ADREdge, and for discussion at the International Academy of Mediators Fall 2000 Conference.
1. California Evidence Code section 1119 states in part:
- No evidence of anything said or any admissions made for the purpose of, in the course of, or pursuant to, a mediation or a mediation consultation is admissible or subject to discovery, and disclosure of the evidence shall not be compelled,…
- No writing, as defined in Section 250, that is prepared for the purpose of, in the course of, or pursuant to, a mediation or a mediation consultation, is admissible or subject to discovery, and disclosure of the writing shall not be compelled,…
- All communications, negotiations, or settlement discussions by and between participants in the course of a mediation or a mediation consultation shall remain confidential.
Section 1126 provides:
“Anything said, any admission made, or any writing that is inadmissible, protected from disclosure, and confidential under this chapter before a mediation ends, shall remain inadmissible, protected from disclosure, and confidential to the same extent after the mediation ends.”
2. Evidence Code section 703.5 states in part:
“No person presiding at any judicial or quasi-judicial proceeding, and no arbitrator or mediator, shall be competent to testify, in any subsequent civil proceeding, as to any statement, conduct, decision, or ruling, occurring at or in conjunction with the prior proceeding, except as to a statement or conduct that could (a) give rise to civil or criminal contempt, (b) constitute a crime, (c) be the subject of investigation by the State Bar or Commission on Judicial Performance, or (d) give rise to disqualification proceedings under paragraph (1) or (6) of subdivision (a) of Section 170.1 of the Code of Civil Procedure. However, this section does not apply to a mediator with regard to any mediation under Chapter 11 (commencing with Section 3160) of Part 2 of Division 8 of the Family Code.”
3. Evidence Code Section 1117:
- Except as provided in subdivision (b), this chapter applies to a mediation as defined in Section 1115.
- This chapter does not apply to either of the following:
- A proceeding under Part 1 (commencing with Section 1800) of Division 5 of the Family Code or Chapter 11 (commencing with Section 3160) of Part 2 Division 8 of the Family Code.
- A settlement conference pursuant to Rule 222 of the California Rules of Court.