Here is the CDRC Letter to the Court

November 3, 2008 · Filed Under Mediation - General · Comment 

 The following letter was sent today by Jim Madison on behalf of CDRC.



November 3, 2008


Chief Justice Ronald George

                                    and Associate Justices

California Supreme Court

350 McAllister Street

San Francisco, CA 94102-3600


                                    Re:  Estate of Thottam  Supreme Court No. S166943


Dear Chief Justice and Associate Justices:


This letter is written on behalf of the California Dispute Resolution Council pursuant to Rule 8.500(g)(1) of the California Rules of Court (”CDRC”) as amicus curiae with regard to the Petition for Review of the above-described case.


The case concerns mediation confidentiality, a vital characteristic of mediation, which has been upheld by this Court on four previous occasions.


The particular statutory aspect of mediation confidentiality that is at issue in this case is Section 1123 of the Evidence Code, which specifies circumstances under which agreements reached in mediation may be admitted in evidence as exceptions to the confidentiality established by Section 1119, and more particularly Section 1123(c).


The Court of Appeal decision held that a “chart” which failed to satisfy any of the requirements of Section 1123(c) to qualify as an exception to Section 1119 was nevertheless admissible in evidence.  The chart was not described by the parties as a written settlement agreement, it was not signed by them and it was not the subject of a written or oral agreement that it should be admissible in evidence pursuant to Evidence Code.


The Court of Appeal held that it was sufficient for the parties to have agreed at the outset of their mediation meeting to except from confidentiality “all matters . . . necessary to enforce any agreements resulting from the Meeting” and for the chart to be susceptible of being regarded as an agreement.


If allowed to stand as precedent, the Court of Appeal decision will have created a significant judicial exception to mediation confidentiality,

contrary to the prohibition on such exceptions established by this Court in





Chief Justice George and Associate Justices

November 3, 2008

Page 2


its previous decisions.


For the reasons set forth below, the CDRC urges that the case either be accepted for review and reversed or ordered not to be published in the Official Reports.




The CDRC is a nonprofit membership corporation which was organized in 1994 to advocate for fair, accessible and effective alternative dispute resolution processes before the Legislature, state administrative agencies and the courts.  The membership of the CDRC consists of several hundred individual ADR neutrals, as well as community dispute resolution organizations and providers of ADR services, which, taken together, represent more than 15,000 mediators and arbitrators in California.


One of the first actions of the CDRC after its organization was to formulate and in 1995 to adopt a set of Dispute Resolution Principles which have governed its advocacy throughout its history.  Among other matters, these Principles provide that no oral or written statement made in connection with a mediation should be admissible in evidence in any adversary proceeding.  In keeping with its Dispute Resolution Principles, the CDRC worked actively with the Law Revision Commission and the Legislature on the mediation confidentiality legislation which resulted in Evidence Code Sections 1115, et seq. As a matter of practice, mediators in California have come to assure mediation participants that, except to the extent specifically provided by Evidence Code Sections 1120 -1123, anything that is said or written in or for a mediation will be protected by mediation confidentiality.  Under Rule of Court 3.854, this practice is mandatory in court-connected mediations.


Pursuant to leave granted by this Court, the CDRC has previously filed briefs as amicus curiae arguing in support of mediation confidentiality in Foxgate Homeowners Ass. v. Bramalea California, Inc. (2001) 26 Cal. 4th 1, Rojas v. Superior Court (2004) 33 Cal. 4th 407, and most recently in Simmons v. Ghaderi (2008) 44 Cal. 4th 570. 







Chief Justice George and Associate Justices

November 3, 2008

Page 3


The perspective of the CDRC is different from that of the parties, and it is  not allied with or retained by either side.  Its interest in submitting this letter is its belief that protection of mediation confidentiality requires that the Court of Appeal decision not be allowed to stand as precedent. 




Evidence Code Section 1123 provides an exception to mediation confidentiality for a document that satisfies two basic conditions and any one of four subsidiary conditions.  The document first must be a “written settlement agreement.”  Secondly, the document must be “signed by the settling parties.”  And finally, the document must satisfy one of Sections 1123(a), (b), (c) or (d).


In Fair v. Baktiari, 40 Cal. 4th 189 (2006), the effort to convert a so-called “term sheet” document signed at a mediation conference into a formal settlement agreement revealed that the parties had different understandings of what supposedly had been agreed to, i.e., that they had not reached a genuine meeting of the minds.


This Court held that the term sheet did not satisfy the exception to mediation confidentiality specified Section 1123(b).


In Fair the Court wrote that that, in order to satisfy Section 1123, a “writing must make clear that it reflects an agreement and is not simply a memorandum of terms for inclusion in a future agreement.”  This is because Section 1123 was intended to aid in the enforcement of agreements, not to facilitate disputes over whether an agreement was reached. 


In the present case, there is unquestionably a difference between the parties over whether an agreement was reached.  One of the parties sought to have the “chart” which is at issue admitted in evidence in order to prove, not only that an agreement was reached, but also that the agreement was supposedly reflected in the chart.   Others disputed these contentions.


If the decision of the Court of Appeal is allowed to stand, a judicial

exception to mediation confidentiality will have been created in addition





Chief Justice George and Associate Justices

                        November 3, 2008

Page 4


to the exceptions specified in Section 1123.


As an essential first step to being excepted from mediation confidentiality under any of the subsections of Section 1123, there must be a written settlement agreement.  No word or phrase remotely resembling “agreement” appears in the disputed chart.  For all that can be known, the disputed chart may have been nothing more than a hypothetical allocation of the disputed assets, assuming that an overall agreement could be reached. 


By inferring the existence of an agreement in this case despite the spirited disagreement between the parties, the Court of Appeal decision would allow precisely what Section 1123 was designed to avoid, as recognized in Fair.  The Court of Appeal decision would permit disputes over settlement agreements to “erupt in litigation, avoiding the process of resolution in mediation.”  The error is manifest in the Court of Appeal’s conclusion that the disputed chart should be admitted in evidence, not for enforcement as a settlement agreement, but to aid in resolution of a dispute over whether an agreement had been reached.


A second essential characteristic of a written settlement agreement that is to be excepted from mediation confidentiality under any of the subsections of Section 1123 is that it be “signed by the settling parties.”  The Court of Appeal decision in this case ignored this requirement.


Finally, as recognized in Fair, the parties are required to express their agreement “to be bound by the document they sign.”  The requirement that parties must sign the particular document sought to be excepted from mediation confidentiality was evaded by the Court of Appeal decision in this case.  The court accepted as sufficient compliance with the statutory requirement a mediation agreement signed by the parties at the outset of the mediation conference which purported to except from mediation confidentiality any matters “necessary to enforce any agreement resulting from the Meeting.”  Accepting what might be regarded as a blank check in lieu of subscription to the particular document at issue would subvert Section 1123(c) in particular and Section 1123 in general and allow virtually any document alleged to be a settlement agreement to be admitted in evidence contrary to Fair.





Chief Justice George and Associate Justices

November 3, 2008

Page 5


The vice in the Court of Appeal decision with respect to admissibility of the chart was compounded by its apparent allowance of testimony about what transpired in the mediation on the theory that the blank check agreement constituted an “exception to the mediation privilege.”  In addition to once again making clear that the carefully crafted mediation confidentiality legislation, including Evidence Code Section 1123, is not open to judicial exceptions, this Court should remind lower courts that, as recognized in Simmons v Ghaderi (2008) 44 Cal. 4th 570, mediation confidentiality requires the exclusion of evidence as a matter of public policy and not as a matter of evidentiary privilege.




Because the Court of Appeal decision would create a significant judge-made exception to mediation confidentiality if allowed to stand as precedent, this Court should either accept the case for review and reverse it or order that the Court of Appeal decision not be published in the Official Reports.





                                                                        James R. Madison

                                                                        Past President and

Chair, Public Policy Committee


cc:  Clerk, Court of Appeal, Second Appellate District

                              Clerk, Los Angeles Superior Court

                              Stephen Kaplan, Esq.

                              Tyna Orren, Esq.

                              Andrew Jablon, Esq.


Where the Court of Appeal Went Wrong in Thottam Case

September 28, 2008 · Filed Under Mediation - General · Comment 

As preparations are underway on a petition for review to the Supreme Court of California, and having had a chance to read the appellants’ petition draft,  this Nevada County mediator is able to provide a little more insight into what went wrong and why the Supreme Court of California (I never refer to it by the demeaning name favored by cooler cats: “the Supremes”) should review and reverse the 2nd District Court of Appeal in the consolidated matters of In re Estate of Thottam, and Thottam vs Thottam, Case No. B196933, (2008 Daily Journal D.A.R. 10,570)  See earlier blog on Thottam.

During the mediation the parties reached what one of them would claim was an agreement and the others that it was not intended as a final or admissible agreement (a handwritten chart assigning certain assets to each of the parties), but was subject to further consideration and only potential inclusion in a final and formal written agreement.  (It is only a distraction that the party claiming it was a done deal was found to be not believable and dishonest by the trial judge, and that the appellate court thought he had been prejudiced by the exclusion of the chart.)  The trial judge refused admission of the chart into evidence on the grounds that admission was barred by the confidentiality provisions of Evidence Code 1119 and did not meet any of the exceptions of Section 1123.  He refused to regard a pre-mediation agreement that said the proceedings would be confidential except as necessary to enforce an agreement reached in the mediation as sufficient compliance with the statute.  That was a sensible conclusion as you will see.

Subsections (a) and (b) of that statute requires that to be admissible an agreement reached in mediation must contain language to the effect that it is to be binding and/or admissible in evidence.  Such language would make it clear that the parties intended an identifiable document to be free of the confidentiality constraints of Section 1119.  It would not make sense to hold that a pre-mediation agreement could satisfy those two subsections.  However, subsection (c) provides that “the” agreement can be admitted if all parties to it expressly so agree.  The Court of Appeal held that in view of the fact that subsection (c) does not contain a “time requirement”, the pre-mediation language was operative.  Bear in mind that nothing is said in the statute about a pre-mediation agreement clause, nor should it have.  Before the mediation there is little likelihood that the parties will all have agreed on exactly what an “agreement” will look like.  It is only after mediation that the question can be sensibly asked and answered:  “Has an agreement been reached and documented”.  This will be ascertained easily if either subsection (a) or (b) has been invoked by inclusion of the “binding” or “admissible” language.   An alternative way the existence of an agreement can be ascertained is if per subsection (c) “all parties to the agreement expressly agree” to its admissibility in evidence.  The near obvious and only logical interpretation of Section 1123 is that the legislature gave the parties an easy way to make their agreement admissible, but also protected the situation where all parties wanted it to be admissible even though they had failed to invoke (a) and (b).

The Court of Appeal here has read another alternative into the statute, to wit, if the parties agree in the pre-mediation agreement that the agreement reached in mediation shall be enforceable and free of the confidentiality provisions, then it will be admissible.  But, what does “it” refer to?  What is “the” agreement”?  How does the court ascertain whether an agreement was in fact reached?  The inexorable answer to each of these questions is that there is only one way, and that is to violate the very law and rule of confidentiality it is supposed to apply!  How can a court admit testimony of what went on in a mediation, what was intended by a writing created in the course of mediation, or whether all of the parties agreed that in its present form it was to be admitted in evidence and enforced, without violating Section 1119, which states clearly that neither oral communications within a mediation or such documents created in the course of it are admissible.  The California high court has consistently ruled that there are no exceptions that permit delving into the substance of mediation communications for such purposes.  The Court of Appeal in this case not only ignored its superiors, but the rational interpretation of the statute as well.