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Van Winkle: Decision pits mediation confidentiality against contract law

John R. Van Winkle
July 18, 2012
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By John Van Winkle

van-winkle-john-mug.jpg Van Winkle

In the recent case of Horner v. Carter, __N.E.2nd__ (Ind.Ct.App. 2012), 34A02-1111-DR-1029, the Indiana Court of Appeals held that evidence of mediation communications was admissible in a hearing to modify a 7-year-old mediated settlement agreement incorporated into a decree of dissolution. The court had two basic reasons for allowing the testimony of matters communicated during the mediation. First, the court ruled that the evidentiary exclusion provisions of ADR Rule 2.12 and Indiana Evidence Rule 408 did not require exclusion of the evidence because it was offered for a purpose other than “to prove liability for or invalidating of the claim or its amount.” The court ruled that the husband was offering the mediation communication to establish that a mistake had been made in the drafting of the agreement.

The second basis for the court’s ruling is arguably more problematic; that is, that the mediation confidentiality provisions of the ADR rules do not prohibit the admission of mediation communications when used to establish traditional contract defenses such as mistake, fraud and duress.

Clash of mediation confidentiality and substantive contract law

The Horner case highlights the difficulty that occurs when mediation confidentiality provisions collide with long-established contract common law. Courts have not reached unanimous conclusions. For example, in the case of In re Marriage of Kieturakis, 138 Cal.App.4th 56 (Ct.App.2006), the California Court of Appeals wrestled with the problem. In that case, two years after a mediated settlement agreement was reached in a dissolution of marriage, the wife sought to overturn the agreement alleging it had been reached under duress. The California Court of Appeals excluded the testimony of mediation communications, continuing in that state what has been considered to be a “super privilege” created by the California mediation statute.

In the article, “When Mediation Confidentiality and Substantive Law Clash: An Inquiry into the Impact of In Re Marriage of Kieturakis on California Confidentiality Law,” [8 Pepperdine Dis. Res. L. J, Article 7 (2012)], the journal editor discussed the Kieturakis case and the issue presented when mediated agreements are later challenged and parties seek to introduce evidence of mediation communications to support or defend against such challenges. Importantly, that article, as did the court in Horner, cited and discussed the provisions and comments of the Uniform Mediation Act. The UMA was drafted in 2001 by a joint effort of the American Bar Association’s Section of Dispute Resolution and the National Conference of Commissioners on Uniform State Laws, and was based not on the evidentiary exclusionary principles of Evidence Rule 408 but rather upon the establishment of a privilege for mediation communications.

Unlike California, however, where the mediation confidentiality provisions have been strictly enforced, the UMA recognized that in appropriate circumstances the mediation confidentiality should defer. The UMA provides in Section 6(B)(2)that the confidentiality privilege may not apply in certain instances in connection with proceedings “to prove a claim to rescind or reform or a defense to avoid liability on a contract arising out of mediation.” The UMA, however, provides important preconditions that must be met before mediation communications will be admissible.

The UMA requires an in camera hearing and weighing of interests

Although the Indiana Court of Appeals in Horner cited UMA Section 6(B)(2) and its comments for the proposition that the exception to the privilege created was to preserve traditional contract defenses, it did not discuss the important balancing and weighing of interests contemplated by that same section. The drafters of the UMA understood that there would be occasions when equities would require that evidence of what was done or said in a mediation be admitted into evidence.

The policy and process reasons for the confidentiality provisions were so critical, however, that the drafters wanted to ensure that such occasions were limited and that there would be process safeguards in place. Therefore, the UMA provides that no evidence of mediation communications should be admitted into evidence until and unless there is an in camera hearing in which the party seeking to use the evidence demonstrates that “the evidence is not otherwise available” and that “there is a need for the evidence that substantially outweighs the interest in protecting confidentiality.” Peter Robinson’s article, “Centuries of Contract Common Law Can’t Be All Wrong: Why the UMA’s Exception to Mediation Confidentiality in Enforcement Proceedings Should Be Embraced and Broadened,” 2003 J.Disp.Resol.135, (2003) is cited in Horner in support of the decision to allow the admission of mediation communication, but the decision does not refer to or discuss the critical weighing and balancing principles inherent in the UMA’s exception. Robinson in that article states: “While this exclusion provides the means to apply contract law when enforcing mediated agreements, the UMA reflects a strong commitment to the interests of mediation confidentiality by imposing numerous conditions and one problematic limitation on the implementation of the exception.” (2003 JDR at p.168)

Although Robinson concludes the UMA is flawed in that it prohibits mediator testimony, he underscores the importance of the in camera hearing and states that the “extreme remedy” of allowing the admission of mediation communications is only available after specific findings by a neutral authority. It is this balancing and weighing inherent in the in camera hearing which is missing from the discussion and holding of Horner.

Conclusion

It is submitted that the balancing and weighing of interests contemplated by the UMA and embodied in the requirement for an in camera hearing should be adopted by Indiana courts. Such a hearing ensures that traditional contract defenses and actions are preserved without unnecessary erosions of mediation confidentiality.

The question is how best to graft this requirement into our current law. A clarification or expansion of the holding in Horner by the Indiana Supreme Court would serve as one path. Because, however, the change or expansion of the law would create an affirmative obligation on the part of trial courts to conduct in camera hearings, it could be that the best course would be for the Indiana General Assembly to join the 11 other states, including our neighbors Ohio and Illinois, and adopt the Uniform Mediation Law. Although the adoption of the UMA in Indiana would require some tweaking of the ADR Rules, there would not be a radical departure from the manner in which those ADR Rules have been interpreted to date by the Indiana Supreme Court. Evidence of mediation communications should only be permitted if the court finds after an in camera hearing that the evidence is otherwise not available and that the interest in protecting mediation confidentiality is outweighed by the need for the evidence.•

__________

John Van Winkle is a full-time mediator and a former chair of the American Bar Association’s Section of Dispute Resolution. The opinions expressed are those of the author.

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  1. I have been on this program while on parole from 2011-2013. No person should be forced mentally to share private details of their personal life with total strangers. Also giving permission for a mental therapist to report to your parole agent that your not participating in group therapy because you don't have the financial mean to be in the group therapy. I was personally singled out and sent back three times for not having money and also sent back within the six month when you aren't to be sent according to state law. I will work to het this INSOMM's removed from this state. I also had twelve or thirteen parole agents with a fifteen month period. Thanks for your time.

  2. Our nation produces very few jurists of the caliber of Justice DOUGLAS and his peers these days. Here is that great civil libertarian, who recognized government as both a blessing and, when corrupted by ideological interests, a curse: "Once the investigator has only the conscience of government as a guide, the conscience can become ‘ravenous,’ as Cromwell, bent on destroying Thomas More, said in Bolt, A Man For All Seasons (1960), p. 120. The First Amendment mirrors many episodes where men, harried and harassed by government, sought refuge in their conscience, as these lines of Thomas More show: ‘MORE: And when we stand before God, and you are sent to Paradise for doing according to your conscience, *575 and I am damned for not doing according to mine, will you come with me, for fellowship? ‘CRANMER: So those of us whose names are there are damned, Sir Thomas? ‘MORE: I don't know, Your Grace. I have no window to look into another man's conscience. I condemn no one. ‘CRANMER: Then the matter is capable of question? ‘MORE: Certainly. ‘CRANMER: But that you owe obedience to your King is not capable of question. So weigh a doubt against a certainty—and sign. ‘MORE: Some men think the Earth is round, others think it flat; it is a matter capable of question. But if it is flat, will the King's command make it round? And if it is round, will the King's command flatten it? No, I will not sign.’ Id., pp. 132—133. DOUGLAS THEN WROTE: Where government is the Big Brother,11 privacy gives way to surveillance. **909 But our commitment is otherwise. *576 By the First Amendment we have staked our security on freedom to promote a multiplicity of ideas, to associate at will with kindred spirits, and to defy governmental intrusion into these precincts" Gibson v. Florida Legislative Investigation Comm., 372 U.S. 539, 574-76, 83 S. Ct. 889, 908-09, 9 L. Ed. 2d 929 (1963) Mr. Justice DOUGLAS, concurring. I write: Happy Memorial Day to all -- God please bless our fallen who lived and died to preserve constitutional governance in our wonderful series of Republics. And God open the eyes of those government officials who denounce the constitutions of these Republics by arbitrary actions arising out capricious motives.

  3. From back in the day before secularism got a stranglehold on Hoosier jurists comes this great excerpt via Indiana federal court judge Allan Sharp, dedicated to those many Indiana government attorneys (with whom I have dealt) who count the law as a mere tool, an optional tool that is not to be used when political correctness compels a more acceptable result than merely following the path that the law directs: ALLEN SHARP, District Judge. I. In a scene following a visit by Henry VIII to the home of Sir Thomas More, playwriter Robert Bolt puts the following words into the mouths of his characters: Margaret: Father, that man's bad. MORE: There is no law against that. ROPER: There is! God's law! MORE: Then God can arrest him. ROPER: Sophistication upon sophistication! MORE: No, sheer simplicity. The law, Roper, the law. I know what's legal not what's right. And I'll stick to what's legal. ROPER: Then you set man's law above God's! MORE: No, far below; but let me draw your attention to a fact I'm not God. The currents and eddies of right and wrong, which you find such plain sailing, I can't navigate. I'm no voyager. But in the thickets of law, oh, there I'm a forester. I doubt if there's a man alive who could follow me there, thank God... ALICE: (Exasperated, pointing after Rich) While you talk, he's gone! MORE: And go he should, if he was the Devil himself, until he broke the law! ROPER: So now you'd give the Devil benefit of law! MORE: Yes. What would you do? Cut a great road through the law to get after the Devil? ROPER: I'd cut down every law in England to do that! MORE: (Roused and excited) Oh? (Advances on Roper) And when the last law was down, and the Devil turned round on you where would you hide, Roper, the laws being flat? (He leaves *1257 him) This country's planted thick with laws from coast to coast man's laws, not God's and if you cut them down and you're just the man to do it d'you really think you would stand upright in the winds that would blow then? (Quietly) Yes, I'd give the Devil benefit of law, for my own safety's sake. ROPER: I have long suspected this; this is the golden calf; the law's your god. MORE: (Wearily) Oh, Roper, you're a fool, God's my god... (Rather bitterly) But I find him rather too (Very bitterly) subtle... I don't know where he is nor what he wants. ROPER: My God wants service, to the end and unremitting; nothing else! MORE: (Dryly) Are you sure that's God! He sounds like Moloch. But indeed it may be God And whoever hunts for me, Roper, God or Devil, will find me hiding in the thickets of the law! And I'll hide my daughter with me! Not hoist her up the mainmast of your seagoing principles! They put about too nimbly! (Exit More. They all look after him). Pgs. 65-67, A MAN FOR ALL SEASONS A Play in Two Acts, Robert Bolt, Random House, New York, 1960. Linley E. Pearson, Atty. Gen. of Indiana, Indianapolis, for defendants. Childs v. Duckworth, 509 F. Supp. 1254, 1256 (N.D. Ind. 1981) aff'd, 705 F.2d 915 (7th Cir. 1983)

  4. "Meanwhile small- and mid-size firms are getting squeezed and likely will not survive unless they become a boutique firm." I've been a business attorney in small, and now mid-size firm for over 30 years, and for over 30 years legal consultants have been preaching this exact same mantra of impending doom for small and mid-sized firms -- verbatim. This claim apparently helps them gin up merger opportunities from smaller firms who become convinced that they need to become larger overnight. The claim that large corporations are interested in cost-saving and efficiency has likewise been preached for decades, and is likewise bunk. If large corporations had any real interest in saving money they wouldn't use large law firms whose rates are substantially higher than those of high-quality mid-sized firms.

  5. The family is the foundation of all human government. That is the Grand Design. Modern governments throw off this Design and make bureaucratic war against the family, as does Hollywood and cultural elitists such as third wave feminists. Since WWII we have been on a ship of fools that way, with both the elite and government and their social engineering hacks relentlessly attacking the very foundation of social order. And their success? See it in the streets of Fergusson, on the food stamp doles (mostly broken families)and in the above article. Reject the Grand Design for true social function, enter the Glorious State to manage social dysfunction. Our Brave New World will be a prison camp, and we will welcome it as the only way to manage given the anarchy without it.

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