On April 13, 2017, the California Law Revision Commission (CLRC) met once again to discuss mediation confidentiality as well as other topics. In preparation for this meeting, Barbara Gaal, Chief Deputy Counsel posted Memorandum 2017-19 which contains the almost final version of the Tentative Recommendation that will probably be posted for public comment after the next meeting on June 8, 2017 in Sacramento. Although it is 81 pages, it is a very concise statement of the Commission’s research, preliminary conclusions and proposed legislation. In short, it is the equivalent of “Mediation Confidentiality and its Exceptions in a Nutshell” if the Nutshell series ever issued such a synopsis. (Or, Cliff Notes study guides or Gilbert Study Guides!)

The Commissioners took up several issues during the meeting. The first was to clarify when the exception would apply by adding language in the comment referencing certain language in Lee v Hanley (2015), 61 Cal. 4th 1225,1229:

Under paragraph (1) of subdivision (a), this exception pertains
to an attorney’s conduct in a professional capacity. More precisely,
the exception applies “when the merits of the claim will necessarily
depend on proof that an attorney violated a professional obligation
— that is, an obligation the attorney has by being an
attorney —in the course of providing professional services.” Lee v.
Hanley, 61 Cal. 4th 1225, 1229, 34 P.3d 334, 191 Cal. Rptr. 3d 536
(2015) (emphasis in original); see also id. at 1239. “Misconduct does
not ‘aris[e] in’ the performance of professional services … merely
because it occurs during the period of legal representation or
because the representation brought the parties together and thus
provided the attorney the opportunity to engage in the
misconduct.” Id. at 1238. The exception applies only with respect to
alleged misconduct of an attorney acting as an advocate, not with
respect to alleged misconduct of an attorney-mediator. (Id. at 3.)

The next issue was raised by members of the State Bar Committee on Mandatory Fee Arbitration: whether the exception to mediation confidentiality should also apply in mandatory fee arbitrations where the fee dispute arises in the context of the mediation or mediation consultation. After some lengthy discussion, the Commissioners voted “yes”, agreeing that the following subpart (C) should be included in the proposed legislation:

SEC. ___. Section 1120.5 is added to the Evidence Code, to read:
1120.5. (a) 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 both of
the following requirements are satisfied:

(2) The evidence is sought or proffered in connection with, and is used solely in resolving one of the following:
 (A) A complaint against the lawyer under the State Bar Act,
Chapter 4 (commencing with Section 6000) of the Business and
Professions Code, or a rule or regulation promulgated pursuant to
the State Bar Act.
(B) A cause of action for damages against the lawyer based
upon alleged malpractice.
(C) A dispute between a lawyer and client concerning fees,
costs, or both including a proceeding under the State Bar Act,
Chapter 4, Article 13-Arbitration of Attorneys’ Fees, Business &
Professions Code Sections 6200-6206. (Id. at 4.)

The third issue was to add clarifying language about providing notice to all of the participants that a lawsuit has been filed.  The notice required is only to those “…whose identities and addresses are reasonably ascertainable. This requirement is in addition to, not in lieu of, other requirements relating to service of the complaint or cross complaint.” This will be added to subpart (d) of the proposed Evidence Code section 1120.5. (Id. at 7-8).

The next issue was a bit more vexing. At the last meeting in February, employees of the Public Employment Relations Board raised the issue that while mediators are immune from testifying under Evidence Code Section 703.5, that section is silent about requiring mediators to produce documents, respond to written discovery et cetera.  At the last meeting, the Commissioners decided against making any changes in Evidence Code section 703.5 and left open where to make the changes, if any, to clarify that documents of a mediator are also immune.

At this meeting, the Commissioners took up the issue and decided to add a sentence in the proposed legislation to indicate that the notes or other written material of the mediator are excluded or immune as well. The Commissioners asked the Chief Deputy Counsel to draft language for the next meeting to the effect that a mediator is not competent to provide either testimony or written evidence under this new exception. (Id. at 8-10).

But, then the point was made that while the mediator is immune from producing written documentation, this does not prevent a party from attempting to obtain it from a third party such as Google or any other internet, e mail or cloud provider etc. While everyone agreed that if one cannot obtain the “evidence through the front door, then they should not be able to obtain it through the back door” but were unclear how to address this issue. So, the Chief Deputy Counsel will research the issue and provide a discussion memo for the next meeting on this issue.

The CLRC then took up Ron Kelly’s suggestion that mediators should be required to provide some sort of warning that this exception exists so that what goes on in Las Vegas may not necessarily stay there. He proposed a warning like the Miranda warning. The CLRC rejected this proposal. (Id. at 10-11)

Another suggestion was made that the proposed legislation should make a specific reference in subpart (e) of the proposed draft statute to Evidence Code section 703.5. Proposed Evidence Code 1120.5(e) now reads:

(e) Nothing in this section is intended to affect the extent to which a mediator is, or is not, immune from liability under existing law.

The Deputy Chief Counsel will add a specific reference to Evidence Code Section 703.5 both in this proposed legislation and in the Comment to it.

Finally, the issue was raised that the proposed legislation is broader than the original resolution introduced in 2011 by the Conference of California Bar Associations which became AB 2025. That proposed bill created an exception only for “communications directly between the client and his or her attorney, only”; not for all communications between any or all of the participants in a mediation that prove to be relevant and are offered in a civil legal malpractice action or disciplinary proceeding before the State Bar. (See, Memorandum 20017-20) The Commissioners decided to table this issue until after it approves and posts its Tentative Recommendation and receives public comment. Depending on the public comments, it may take up this issue of narrowing the exception to conform to AB 2025.

The next meeting is on June 8, 2017 in Sacramento. As always, I urge everyone either to attend or to submit comments to Barbara S. Gaal, Esq., Chief Deputy Counsel, bgaal@clrc.ca.gov or Barbara S. Gaal, Esq., California Law Revision Commission, 4000 Middlefield Road, Suite D2, Palo Alto, Ca 94303.

I strongly suspect that at this meeting, the CLRC will finish its work and approve the Tentative Recommendation which will be issued soon thereafter for a 60- 90-day comment period. Once those comments are received, the CLRC will make any changes it deems necessary and then pass it on to the legislature where it begins that process. So, while the exception to mediation confidentiality has a long way to go before it becomes law in California, I sense that the initial work of the CLRC will be concluded at its June meeting.

…. Just something to think about.

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