Mediation is a common and growing alternative to litigation in the business community and in the courts. Users choose it for a variety of reasons: it’s confidential, non-binding, less time consuming than litigation, less costly, provides parties with greater control over their own destiny, and greater process satisfaction. Nearly half of survey respondents cited confidentiality as a major reason for using mediation.
Confidentiality is the “heart” of mediation, without which it could not succeed. It encourages open and truthful conversation about the matter in dispute, admissions of evidentiary or procedural weaknesses, disclosure of sensitive financial or medical information, and exploration of potential liability and possible avenues of settlement.
If mediation were to fail, such conversations could easily be used to a party’s disadvantage. So the ability to exclude the information from the litigation process is a logically necessary precondition to participation in a voluntary process like mediation.
As a result all 50 states and the District of Columbia protect mediation privacy, either by statute or court rule.
Federal courts take a case by case approach under FRE secs 501 and 408.
California has one of the most comprehensive mediation confidentiality statutes anywhere. In summary, evidence of a statement or writing made in preparation for, during, or pursuant to mediation or a mediation consultation is neither admissible or discoverable in a civil case. In addition, a mediator is generally incompetent as a civil witness. There are exceptions and limitations to these rules.
For example, they only relate to legal testimony and evidence. There is nothing statutory preventing a party from discussing mediation related events with friends, neighbors, co-workers – even the press. Therefore, the parties may wish to enter into a written mediation confidentiality agreement prohibiting disclosure. The court will enforce the parties’ reasonable expectations of privacy on Constitutional grounds.
Privilege and confidentiality will give way where other Constitutional interests outweigh the parties’ interest in privacy. Even where the protections otherwise apply, a criminal defendant’s right to cross-examine and impeach witnesses will overcome them. In Rinaker, v. Superior Court, juveniles were charged with criminal vandalism. The victim (Torres) also filed a civil action. In mediation, Torres admitted that he did not see the juveniles damage his car. At the criminal trial, the victim testified otherwise. The defendants then sought to compel the mediator’s testimony. On appeal, the court refused to enforce mediation confidentiality at the expense of defendants’ Sixth Amendment rights.
In the absence of Constitutional concerns, the courts have been vigorous enforcers of statutory confidentiality. They have refused to go beyond the plain language of the law, reasoning that the Legislature could have done so. For example, the California Supreme Court has refused to sanction a good cause exception to mediation confidentiality, even where probative evidence is unavailable otherwise. Similarly, a client cannot use conversations in mediation to prove attorney malpractice, unless all participants involved in the communication agree.
California’s Mediation Act is construed strictly. Equitable doctrines like estoppel are not permitted to vary the straightforward results the statutes dictate.
Communication confidentiality will also not give way to party claims for sanctions. In addition, a mediator may not report on anything but the success or failure of the mediation – and so cannot support a sanctions motion. However, while communications may not be revealed, parties (but not neutrals) may disclose non-communicative conduct justifying sanctions. Confidentiality protections persist after the mediation is over.
The strict approach to confidentiality causes practical problems in settlement. Logically, neither a mediation-related settlement document nor oral settlement statements will be admissible, since both are made in preparation for, during, or pursuant to mediation or a mediation consultation. The language must appear clearly on the face of the document, since the court will not review extrinsic evidence. In the absence of the statutory conditions, the settlement is unenforceable.
To avoid enforceability issues, many neutrals use preprinted memoranda of understanding forms containing the required language.
Mediation confidentiality applies to oral settlements. Oral agreements must be fixed before all parties and the mediator in a reliable method of sound recording. The parties must express their consent and their intent to be bound on the record. The agreement must be reduced to a signed writing within 72 hours.
Mediation confidentiality is vital to the settlement process. Keeping that vitality in mind is the key to understanding California’s statutory protections.
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