Opinion ID: 2584943
Heading Depth: 3
Heading Rank: 1

Heading: The Mediation Confidentiality Statutes

Text: In 1997, the Legislature adopted the California Law Revision Commission's (Commission) recommendations and revised the mediation confidentiality statutes. ( Fair v. Bakhtiari (2006) 40 Cal.4th 189, 194-196 [51 Cal.Rptr.3d 871, 147 P.3d 653] ( Fair ).) It enacted section 1115 et seq., creating an extensive statutory scheme governing mediation confidentiality and its exceptions. ( Fair, supra, at pp. 194-196.) California's Legislature has a strong policy favoring mediation as an alternative to litigation. Because mediation provides a simple, quick, and economical means of resolving disputes, and because it may also help reduce the court system's backlog of cases, it is in the public interest to encourage its use. [Citation.] ( Doe 1 v. Superior Court (2005) 132 Cal.App.4th 1160, 1165 [34 Cal.Rptr.3d 248].) The Legislature designed the mediation confidentiality statutes to promote `a candid and informal exchange regarding events in the past.... This frank exchange is achieved only if the participants know that what is said in the mediation will not be used to their detriment through later court proceedings and other adjudicatory processes.' [Citations.] ( Foxgate Homeowners' Assn. v. Bramalea California, Inc. (2001) 26 Cal.4th 1, 14 [108 Cal.Rptr.2d 642, 25 P.3d 1117] ( Foxgate ).) [C]onfidentiality is essential to effective mediation.... ( Ibid. ) (1) Section 1119 governs the general admissibility of oral and written communications made during the mediation process. It prohibits any person, mediator and participants alike, from revealing any written or oral communication made during mediation. ( Foxgate, supra, 26 Cal.4th at p. 13.) Section 1119, subdivision (a) states, in pertinent part, that: Except as otherwise provided in this chapter: [¶] (a) No evidence of anything said or any admission made for the purpose of, in the course of, or pursuant to, a mediation ... is admissible or subject to discovery, and disclosure of the evidence shall not be compelled, in any ... civil action.... Similarly, section 1119, subdivision (b) states, in pertinent part, that: Except as otherwise provided in this chapter: [¶] ... [¶] No writing ... 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, in any ... civil action.... Section 1119, subdivision (c) further mandates that All communications, negotiations, or settlement discussions by and between participants in the course of a mediation ... shall remain confidential. Sections 1122 and 1124 specifically lay out exceptions for the admission of evidence produced during mediation. As relevant here, section 1122, subdivision (a)(1) provides that [a] communication or a writing ... that is made or prepared for the purpose of, or in the course of, or pursuant to, a mediation or a mediation consultation, is not made inadmissible, or protected from disclosure, by provisions of this chapter if ... the following condition[] is satisfied: [¶] (1) All persons who conduct or otherwise participate in the mediation expressly agree in writing, or orally in accordance with Section 1118, to disclosure of the communication, document, or writing. (2) Section 1124 specifies that an oral agreement made in the course of, or pursuant to, a mediation is not made inadmissible, or protected from disclosure, if certain conditions involving section 1118 are satisfied. [4] Oral agreements in accordance with section 1118 occur when: (a) the oral agreement is recorded by a court reporter, tape recorder, or other reliable means of sound recording; (b) the terms of the oral agreement are recited on the record in the presence of the parties and the mediator, and the parties express on the record that they agree to the terms recited; (c) the parties to the oral agreement expressly state on the record that the agreement is enforceable or binding or words to that effect; and (d) the recording is reduced to writing and the writing is signed by the parties within 72 hours after it is recorded. The legislative scheme also provides rules for the use of written settlement agreements produced during mediation. Section 1123 protects the confidentiality of any written agreement made during mediation unless the parties expressly agree to disclosure or the agreement is used to show fraud, duress, or illegality. [5] (3) Further, statements made during mediation and mediation materials are confidential not only during the mediation, but also after the mediation ends. Section 1126 clarifies that [a]nything 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. In addition to the unambiguous language of the mediation confidentiality statutes, the Commission's comments further demonstrate that the Legislature intended to apply confidentiality broadly and to limit any exceptions to confidentiality to narrowly prescribed statutory exemptions. ( Fair, supra, 40 Cal.4th at p. 195 [the Commission's official comments are deemed to express the Legislature's intent].) The Commission's comment to section 1124 states explicitly that the section sets forth specific circumstances under which mediation confidentiality is inapplicable to an oral agreement reached through mediation. Except in those circumstances, sections 1119 and 1124 codify the rule of Ryan v. Garcia (1994) 27 Cal.App.4th 1006 [33 Cal.Rptr.2d 158] ( Ryan ) (mediation confidentiality applies to oral statement of settlement terms) and reject the contrary approach of Regents of University of California v. Sumner (1996) 42 Cal.App.4th 1209 [50 Cal.Rptr.2d 200] ( Regents ) (mediation confidentiality does not protect oral statement of settlement terms). (Cal. Law Revision Com. com., 29B pt. 3 West's Ann. Evid. Code (2008 supp.) (hereafter California Law Revision Commission) foll. § 1124, p. 257.) As noted in the Commission's comment, with section 1124 the Legislature created a specific mechanism for the admission of evidence regarding oral settlement agreements made during mediation. This mechanism was created in reaction to two conflicting Court of Appeal decisions, Ryan and Regents. In Ryan, supra, 27 Cal.App.4th at page 1013, the Court of Appeal held that under former section 1152.5 (now section 1119), evidence offered to prove the terms of an oral settlement agreement reached during mediation was inadmissible because it did not meet statutory requirements. In Ryan, the parties went to mediation, agreed to a compromise, and orally recited the terms of the agreement. (27 Cal.App.4th at pp. 1008-1009.) The agreement, however, was never reduced to writing, and the defendant later contested the terms of the settlement. ( Ibid. ) The plaintiffs amended their complaint to add a cause of action to enforce the oral settlement. ( Id. at p. 1009.) Over defendant's objections, the trial court admitted evidence of the oral recitation of the settlement terms to prove the existence of an agreement. ( Ibid. ) The court reasoned that once the mediator announced the compromise, statements made thereafter were not produced in the course of mediation and were not protected under section 1152.5. ( Ryan, at p. 1009.) The defendant appealed, claiming the statements concerning the existence and terms of the settlement agreement were part of the mediation and therefore inadmissible. ( Ryan, supra, 27 Cal.App.4th at p. 1010.) Noting that former section 1152.5 should be broadly interpreted to ensure confidentiality, the Court of Appeal held that the oral statements made after the announced compromise were made in the course of mediation. ( Ryan, at p. 1013.) The court rejected the plaintiffs' argument that such interpretation of the statutory scheme would divest mediation of its intended usefulness, and it noted that the statutes provided a procedural mechanism to protect confidentiality and simple and clear means for enforcement of agreed-upon settlements. ( Id. at p. 1012.) Subsequently, in Regents, supra, 42 Cal.App.4th 1209, the Court of Appeal declined to follow Ryan and held that former section 1152.5 did not bar introduction of oral statements evidencing a settlement made after a compromise had been achieved. Although the Court of Appeal acknowledged its decision contradicted Ryan, it nonetheless concluded that a trial court could admit evidence of oral statements made after a compromise had been reached. ( Regents, supra, 42 Cal.App.4th at p. 1213.) (4) The Regents rule, however, was expressly rejected by the Legislature when it revised the mediation confidentiality statutes. The Commission's comment to section 1124 provides that, except when the requirements expressly laid out in sections 1124 and 1118 are met, sections 1119 and 1124 together codify the rule of Ryan and reject Regents. (Cal. Law Revision Com., supra, foll. § 1124, p. 257.) Section 1119 is more expansive than its predecessor, former section 1152.5. Section 1119, subdivision (a), extends to oral communications made for the purpose of or pursuant to a mediation, not just oral communications made in the course of the mediation. (Cal. Law Revision Com., supra, foll. § 1119, p. 241.) It also explicitly applies in a subsequent arbitration or administrative adjudication, as well as in any civil proceeding. ( Ibid. ) Recognizing both the breadth and clarity of the mediation confidentiality statutes, we have concluded that the legislative scheme is clear and unambiguous, and that the Legislature intended for mediation confidentiality to apply according to the statutory rules. ( Foxgate, supra, 26 Cal.4th at p. 14.) Thus, mediation confidentiality now clearly applies to prohibit admissibility of evidence of settlement terms made for the purpose of, in the course of, or pursuant to a mediation unless the agreement falls within express statutory exceptions. (§ 1119, subd. (a).) (5) In the present case, an oral agreement may have been reached between defendant's insurer and plaintiffs during the mediation; however, the parties did not follow the statutory procedures that would have made this agreement admissible. Specifically, no form of recordation of the oral agreement exists, nor is there a written agreement signed by both parties. (§§ 1118, 1122, 1124.) The agreement as memorialized by Judge Altman is similarly inadmissible under sections 1119, 1122, and 1123, as there was no express agreement that it could be disclosed, and it was not signed by defendant or her attorneys. The Court of Appeal and the parties do not dispute that evidence of the oral settlement agreement was inadmissible under the statutory requirements.