Mediation Message No. 34

MISREPRESENTATIONS AT SETTLEMENT V. AT MEDIATION

Misrepresentations to a settlement judge can result in a contempt citation or discipline. The question for this Mediation Message is what effect do confidentiality standards have on the reporting of misconduct during mediations?

In In the matter of Jeffers (Review Dept. 1994) 3 Cal. State Bar Ct. Rptr. 211, the attorney, knowing that his client was dead, told a mandatory settlement judge that the client did not believe he was responsible for the accident or the plaintiff’s resulting injuries and wanted the matter to be tried The attorney also told the judge that he had talked to his client just before the MSC and that the client, who had been under a conservatorship, was able to communicate, notwithstanding his physical limitations. Only after digging a deeper hole about his client’s physical condition, did the attorney admit that the client was dead. These misrepresentations were a violation of Business and Professions Code section 6068(d) and Rule of Professional Conduct 5-200(B).

Business and Professions Code section 6068(d) provides that attorneys shall not “seek to mislead the judge or any judicial officer by an artifice or false statement of fact or law.” Rule of Professional 5-200(B) is essentially the same except it adds jurors to the prohibition. These ethical guidelines reflect the policy that “Honesty in dealing with the courts is of paramount importance, and misleading a judge is, regardless of motives, a serious offense.” (DiSabatino v. State Bar (1980) 27 Cal.3d 159, 162-163, citing Paine v. State Bar (1939) 14 Cal.2d 150, 154.) Business and Professions Code section 6106 (concerning acts of moral turpitude and dishonesty) prohibits misrepresentations by a lawyer to opposing counsel. (In the Matter of Katz (Review Dept. 1995) 3 Cal. State Bar Ct. Rptr. 430, 435.)

Although Jeffers and Katz make it clear that an attorney cannot misrepresent facts to a settlement judge or opposing counsel, case law provides that misrepresentations at a mediation are not sanctionable or disciplinable, absent the amendment of Evidence Code sections which provide for confidentiality in that setting. The analysis starts and ends with Foxgate Homeowners’ Association, Inc. v. Bramalea California, Inc. (2001) 26 Cal.4th 1, which states that a mediator, pursuant to Evidence Code sections 1119 and 1121, may not report a participating attorney’s misconduct to the judge who has the case on his or her calendar.

Foxgate also distinguishes between the right of opposing counsel to report misconduct but not communications. While finding that a party may report misconduct even though a mediator may not (id. at p. 4) and, without deciding the issue, that a court that ordered a mediation may impose sanctions for conduct during the mediation, pursuant to C.C.P. section 128.5 (id. at p. 10, n. 6), Foxgate then states that “Neither a mediator nor a party may reveal communications made during mediation” (id. at p. 4) and that Evidence Code section 1121 prohibits both mediators “and anyone else from submitting a document that revealed communications during mediation and barred the court from considering them.” (Id. at p. 13.) The opinion reasons that:

Although a party may report obstructive conduct to the court, none of the confidentiality statutes currently make an exception for reporting bad faith conduct or for imposition of sanctions under that section when doing so would require disclosure of communications or a mediator’s assessment of a party’s conduct although the Legislature presumably is aware that Code of Civil Procedure section 128.5 permits imposition of sanctions when similar conduct occurs during trial proceedings. FN. 13.

FN.13. The conflict between the policy of preserving confidentiality of mediation in order to encourage resolution of disputes and the interest of the state in enforcing professional responsibility to protect the integrity of the judiciary and to protect the public against incompetent and/or unscrupulous attorneys has not gone unrecognized. (Citations omitted.) As noted, however, any resolution of the competing policies is a matter for legislative, not judicial, action.

Id. at p. 17.

Foxgate, therefore, allows attorneys to report an opponent’s mediation misconduct, such as the failure to appear at a mediation or any other unacceptable misbehavior that does not include a communication, but protects, until the legislature says otherwise, all communications during the mediation, no matter how improper.

Copyright, Michael D. Marcus, May 2006

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