Do mediators still need confidentiality agreements under the new informed consent law?

Starting New Years Day, attorneys representing clients in mediations must obtain their clients' written, signed acknowledgement that they understand California's mediation confidentiality laws. It is akin to the informed-consent requirement in hospitals: does the patient understand and accept the risks?

As a mediator and member of The Mediation Society, should fellow mediators and I still follow the customary practice of obtaining signed acknowledgements of confidentiality rules from all parties? Will mediators have any obligation to confirm that the attorneys in the case have complied with the new law?

Background

On Jan. 1, 2019, the California Evidence Code will include a new provision, Section 1129, requiring attorneys to notify clients in advance of a mediation regarding the laws making mediation communications confidential and to obtain the client's written and signed acknowledgement that he or she has read and understands those provisions. The requirement, understandably, does not apply to class or representative actions.

The new statute includes a 700-word exemplar of how such a disclosure may read. It covers all the bases, and since it "shall be deemed to comply" with the law, there is every reason to use it.

A companion provision, an addition to Evidence Code Section 1122, allows a document related to an attorney's compliance with Section 1129 to be admissible in an "attorney disciplinary proceeding to determine whether the attorney has complied with Section 1129."

In other words, attorneys may use such documents in their defense before the State Bar. Whether the documents can be used to defend a malpractice suit is a subject for another day.

What's a Mediator to Do?

Nothing in the new law suggests that a mediator must provide the parties with any cautionary dissertation on confidentiality. That is the simplest answer to the questions posed above, and therefore is probably the best. But is it too simple?

In practice, many mediators already provide written disclosures regarding mediation confidentiality, either in the body of their mediation contracts or in a separate document, signed as the mediation commences. Some use the "belt and suspenders" method: a signed confidentiality agreement plus an oral explanation of the subject during an introductory joint session.

There are competing principles at work here:

First principle: Mediators are neutrals, we do not represent any party as counsel, and thus should not advise, and should not be expected to advise, any party regarding the law. (Caveat: a mediator who has been hired because he or she has special expertise in the kind of case at hand may be asked to give all parties the benefit of his/her opinion, which is a separate matter.)

Second principle: Mediated settlements should be final, bringing closure to the dispute. The mediator provides a platform on which the parties may reach a settlement. If the underpinnings of that platform are shaky because counsel has not complied with Evidence Code Section 1129, the reliability of the process is at risk.

In this author's view, there is no requirement that a mediator confirm that all counsel have complied with Section 1129, and none should be imposed. Mediators are not required to police counsel's compliance with the rules of court or other obligations, such as paying their State Bar dues and completing their mandatory continuing legal education units.

In the absence of a duty to confirm compliance with Section 1129, will I nonetheless start doing so in January? Yes. It is a new law, and it is coming into effect immediately after the most hectic time of the year for most law firms, with frantic efforts to collect account receivables, complete year-end personnel evaluations and compensation decisions, and the like. The new law may easily be overlooked.

If I noticed that one of the attorneys at a mediation had parked her Tesla next to a fire hydrant (I know it's hers because the vanity license plate reads "Tess#1"), I'd say, "Tess, your beautiful new Tesla is likely to be towed if you don't move it." I suppose pointing out the law against parking a car in a red zone might be a form of legal advice, though also of common knowledge, but I'd mention it out of courtesy as well as to avoid an interruption to the mediation later in the day when a tow truck arrives.

It's not that burdensome to ask in the joint session or the first private caucus, "By the way, does any counsel still need to get the client's signature on the Evidence Code 1129 confidentiality form?" If the need exists the first private caucus could be with a different party, giving the forgetful counsel a chance to speak privately with the client and get the form signed. I might even have a few copies of the exemplar form with me, just in case. But all this is personal preference, not required procedure.

What is the effect of an attorney's failure to comply with Section 1129? The only effect stated in the statute is the obvious one: the attorney cannot use nonexistent documents to prove compliance with the statute in a disciplinary proceeding. To broaden its consequences is not supported by the language of the statute, which could easily have added "or in court."

The idea of a required disclosure that mediations are confidential had been proposed as part of the newly revised Rules of Professional Responsibility, but not adopted, thereby forcing the Legislature to take pen in hand to protect mediation confidentiality by requiring it be disclosed to clients. It is telling that the Legislature did not overrule the body of California appellate decisions in "settle and sue" cases, which say that a client with settler's remorse must prove, to a legal certainty, that he or she would have obtained a better result at trial if the case had not been settled (e.g., Filbin v. Fitzgerald, 211 Cal. App. 4th 154 (2012).

If a mediation participant truly does not understand that mediations are confidential, his or her remedy is not, in my opinion, to void the settlement agreement, which is a different contract than that between the attorney and client, or parties and the mediator. The settlement agreement stands on its own, and in almost every instance will obtain a waiver of California Civil Code 1542, which allows a release to be challenged upon the releasor's discovery of facts that would have affected his/her decision to settle.

Mediations have become the preferred method of resolving civil disputes, in large part due their confidentiality and efficiency. The new law supports those goals, while imposing only a slight additional burden on counsel to state the obvious, in writing, and get it signed by their client.