Mediation Confidentiality

Avoiding Surprises

Confidentiality is a cornerstone of mediation. But, how “confidential” is mediation? In this article, Nancy Yeend, a nationally recognized mediator, discusses the impact of the Uniform Mediation Act (UMA) and the various exceptions and levels of protection afforded to mediators and parties to a mediation.

Many mediators, playing on the currently popular slogan, “What happens in Vegas, stays in Vegas” glibly say, “What happens in mediation, stays in mediation.”  Is this an accurate statement?  To avoid surprises, here are three questions to ask:

• How is confidentiality defined?
• Are there exceptions, and if so, what are they?
• What are the consequences for breaching confidentiality?

Confidentiality is a mediation cornerstone.  Knowing that what is discussed, proposals made, and who held what perspective is confidential and cannot be used in another forum, allow parties to more effectively negotiate, to make offers, and even admit fault or give heart-felt apologies.  Without confidentiality, settlement rates would plummet.

Even though confidentiality is necessary for the mediation process to be effective, anyone participating in mediation needs to understand that there may be some limitations.  For example, if someone thought everything was confidential, and said, “You’ll never get the money, because I put it in another state!”—can that information remain confidential?  Well, if the case is being mediated in Ohio and the person mentions that the money is now in Arizona, everyone realizes that 49 possible states were eliminated and finding the money got a lot easier.  In most jurisdictions, things discoverable by other means are not made undiscoverable by being mentioned in mediation.  What are the rules in your jurisdiction?

How is Confidentiality Defined?

There are almost as many definitions for confidentiality as there are states and Federal courts.  States that have adopted the Uniform Mediation Act (UMA)[1] do not use the word “confidentiality,”[2] preferring to use the word “privilege.”

Other states define confidentiality in straightforward terms.  Florida, for example, refers to confidentiality in this way: “… all mediation communications shall be confidential.  A mediation participant shall not disclose a mediation communication to a person other than another mediation participant or a participant’s counsel.”[3]

California gives a more detailed definition: “No evidence of anything said or any admission made 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 evidence shall not be compelled, in any arbitration, administrative adjudication, civil action, or other noncriminal proceeding in which, pursuant to law, testimony can be compelled to be given.”[4]  Wording like this may be significant for an expert, who prepares a report for the mediation, and then is precluded from using that report in a future trial, should the case not settle in mediation.  Being familiar with how confidentiality is defined and what is included could be critical.

Are There Exceptions, and if so, What are They?

Most states will create exceptions to confidentiality for reporting criminal acts, personal safety threats, and abuse.  Some states limit the reporting to only individuals who are recognized reporting entities, such as attorneys.  Again, the UMA addresses these issues with: “A person that intentionally uses a mediation to plan, attempt to commit, or commit a crime, or to conceal an ongoing crime or ongoing criminal activity is precluded from asserting a privilege…”  Later it states that: “… a threat or statement of a plan to inflict bodily injury or commit a crime of violence…” and “…sought or offered to prove or disprove abuse, neglect, abandonment, or exploitation…”[5] is not protected.

Exceptions for being able to report or to prosecute attorney or mediator malpractice are not universal.  Again, UMA states have adopted wording like, “… sought or offered to prove or disprove a claim or complaint of professional misconduct or malpractice filed against a mediator;”[6] is not confidential.

Then there are states, such as California, which protect both attorney and mediator malpractice.[7]  Florida and other states do not protect malpractice, and have explicit exceptions for reporting it: “Offered to report, prove, or disprove professional malpractice occurring during the mediation, solely for the purpose of the professional malpractice proceeding.”[8]

Eleven states protect mediation communications, but allow for reporting mediator misconduct.[9]  In addition there are eighteen states that have no exception for any professional misconduct or malpractice reporting.[10]  According to a recent report, New York and Kentucky have “little or no protection of mediation communications.”[11]

For experts testifying during a mediation, there do not appear to be any states that explicitly permit the use of materials prepared for a mediation, to be used in another forum.  This may indicate that if an expert wanted to use the same report in more than one mediation, or to use the information at a subsequent trial, an exception would need to be created in the Agreement to Mediate, or all parties would need to agree, in advance of the mediation that the report was not confidential.  This topic is worth addressing before a mediation starts.

Another point to consider, is the settlement agreement a confidential contract?  Although parties may not want the terms of a settlement made public, they may wish to have the option to use the settlement contract in a court as evidence.  This situation may arise, if there is a need to enforce the terms of the settlement.  Some states require that a specific exception be written into the settlement agreement, stating that the document may be used as evidence to enforce terms of the contract.

What are the Consequences for Breaching Confidentiality?

Here is where the water gets very murky.  The topic is typically not addressed in state statutes, but discussed during the final stages of negotiating a settlement, where penalties for breaching confidentiality may be added to the settlement agreement.  Parties want penalties for disclosure of the terms of the settlement.  A key reason for wanting the terms of the settlement to remain confidential is to prevent copycat litigation.

What happens if the case does not settle during the mediation?  Depending on the jurisdiction and the terms of the Agreement to Mediate, some statutes prevent the parties even mentioning that they participated in mediation.  In those jurisdictions, if a party attempts to bring up the mediation at trial, it may be grounds for dismissal of the case.  In other jurisdictions, if the case was court ordered to mediation, the mediator may only be permitted to report who attended and if the case settled or not.  So can there be consequences for breaching confidentiality?  The short answer is, “Yes, there might be.”

Conclusion

Mediation is an effective way to resolve cases; however, as with most things in life, “look before you leap.”  Understand how confidentiality is defined and if there are exceptions, be familiar with those exceptions.  Be aware of any penalties for breaching confidentiality.[12]

[1] At this writing, the following states and the District of Columbia have adopted the UMA: Hawaii, Iowa, Idaho, Illinois, Nebraska, New Jersey, Ohio, South Dakota, Utah, Vermont, Virginia, and Washington.

[2] The UMA refers to confidentiality in Section 4.  Privilege Against Disclosure; Admissibility; Discovery as follows: “(a) … a mediation communication is privileged as provided in subsection (b) and is not subject to discovery or admissible in evidence in a proceeding unless waived or precluded as provided by Section 5.”

[3] The complete definition can be found in Florida statute Chapter 44.401.

[4] See Californian Evidence Code: 1119.

[5] UMA, Section 6: Exceptions to Privilege.

[6] Ibid.

[7] See Cassel v. Superior Court (2011) 51 Cal.4th 113, 244 P.3d 1080.

[8] See Florida Chapter 44.405.

[9] These sates include: Alabama, Arizona, Colorado, Delaware, Georgia, Kansas, Montana, North Dakota, Oklahoma, Oregon, and Tennessee.

[10] These states include: Alaska, Arkansas, California, Connecticut, Indiana, Louisiana, Maine, Missouri, Mississippi, Nevada, New Hampshire, Pennsylvania, Rhode Island, South Carolina, Texas, West Virginia, Wisconsin, and Wyoming.

[11] California Law Review Commission Staff Memorandum, First Supplement to Memorandum 2014-35, September 3, 2014.

[12] This article is not intended as legal advice, and before participating in any dispute resolution process, consult an attorney to learn how the process works, if confidentiality rules apply, and if so, what are the exceptions.

Nancy Neal Yeend is an experienced, nationally recognized dispute management strategist and mediator handling civil cases for nearly 30 years. She serves on two Appellate Mediation Panels, and has served as faculty at the National Judicial College for twenty years. She co-founded Silicon Valley Mediation Group in Los Altos, California, and has recently opened a new office in Portland, Oregon affiliated with Pacific Coast Strategies.
E-mail: nancy@svmediators.com. Ms. Yeend can also be reached at (650) 947-1799