Friday, April 9, 2010
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C.A. Narrows Application of Mediation Confidentiality
By STEVEN M. ELLIS, Staff Writer
Communications between attorneys and clients during mediation do not fall within the purview of mediation confidentiality, this district’s Court of Appeal ruled yesterday.
Reversing a trial court’s ruling, a divided panel of Div. Eight concluded that mediation confidentiality statutes only apply to disputing parties.
Presiding Justice Tricia A. Bigelow, joined by Justice Laurence D. Rubin, said such conversations are not made “for the purpose of, in the course of, or pursuant to” the mediation process, even if they take place with a mediator or opposing counsel present.
However, Justice Madeleine Flier dissented that mediation confidentiality, as set forth in Evidence Code Sec. 1119(a), applied where a conversation only took place as the result of a mediation and represented an effort to bring the mediation to fruition.
The matter arose when Los Angeles Superior Court Judge Warren L. Ettinger granted Torrance law firm Wyner & Tiffany a new trial after a jury awarded former clients John and Deborah Blair Porter $211,000 in back wages and $51,000 for breach of an attorney fee agreement, and rescinded a release the Porters gave the firm regarding tax advice.
Deborah Porter and her husband retained the firm to sue the Manhattan Beach Unified School District and the California Department of Education for failing to provide their autistic son a “free and appropriate public education.” The case, which was filed in 1999 in federal court, went to mediation, and the school district and the department in 2005 agreed to pay more than $6.7 million to settle.
The Porters sued the firm after it failed to follow through on an alleged promise during the mediation to pay Deborah Porter for services she rendered in the case as a paralegal out of the $1.65 million Wyner & Tiffany received in the federal case.
Wyner & Tiffany asserted they were not required to reimburse the Porters for attorney fees and costs the Porters previously advanced because the amount the firm received under the settlement was less than the amount they could have claimed under a contingency fee provision in their retainer agreement. The firm further asserted it was not required to pay Deborah Porter’s fees as a paralegal from its portion of the settlement because she had been fully compensated for her loss of wages in the settlement.
At trial, evidence of the communications between Wyner & Tiffany and the Porters with respect to the alleged promises made at the mediation were admitted, and a jury found for the Porters.
However, approximately one month later, Ettinger granted a motion for a new trial, citing the then-newly-decided case of Simmons v. Ghaderi (2008) 44 Cal.4th 570.
There, the California Supreme Court took a strict view of mediation confidentiality, unanimously ruling that statements made during the process could not be used to bind a party to a settlement agreement she did not sign.
Ettinger ruled that the jury’s consideration of confidential mediation communications created an irregularity in the proceedings statutorily mandating a new trial.
On appeal by the Porters, Bigelow wrote that the legislative history of Sec. 1119(a) showed it was never intended to protect communications or agreements between a client and his or her own counsel should a conflict arise between them.
She also said that expanding mediation confidentiality to cover such communications “would seriously impair and undermine not only the attorney-client relationship but would likewise create a chilling effect on the use of mediations,” adding:
“[C]lients would be precluded from pursuing any remedy against their own counsel for professional deficiencies occurring during the mediation process as well as representations made to the client to induce settlement.”
Plaintiffs’ counsel Gerald L. Sauer of Sauer & Wagner in Los Angeles told the MetNews his clients were “thrilled” by the reversal, and said the facts in the case highlighted “how mediation confidentiality can be abused by attorneys.”
Despite the split, Sauer said, he was pleased the court had “taken a look at the fact that the attorney client privilege should not be trumped by mediation confidentiality.”
Los Angeles attorney Kyle Kveton of Robie & Matthai represented Wyner & Tiffany and said he “respectfully disagreed” with the opinion, commenting:
“Flier got it exactly right.”
He said his clients were considering a petition for rehearing or review by the California Supreme Court in light of the case of Cassel v. Superior Court, S178914, currently pending before the Supreme Court.
In Cassel, the state’s high court has agreed to review whether the private conversations of an attorney and client for the purpose of mediation are entitled to confidentiality, and whether an attorney is a “participant” in a mediation such that communications with a client for purposes of mediation must remain confidential.
The case is Porter v. Wyner, B211398.
Copyright 2010, Metropolitan News Company