FOI Kristen Blankley (Nebraska) offers up a guest post on an interesting attorney malpractice / mediation confidentiality case out of Oregon.  Casenote is written all over this one.

Earlier this month, the Oregon Supreme Court held that pre-mediation communications are not protected communications in Alfieri v. Solomon, __ P.3d ___, 2015 WL 8539065 (Ore. Dec. 10, 2015). Plaintiff Alfieri sued his attorney, defendant Solomon, for legal malpractice following the settlement of Alfieri’s employment discrimination suit.

Relatively early in the case, the parties agreed to mediate. Prior to the mediation, Solomon advised Alfieri as to the potential settlement value of the claim. The parties did not settle the case at the mediation session. At the conclusion of the mediation, the mediator gave a suggested settlement, and Solomon convinced Alfieri to accept the terms suggested by the mediator. After the settlement was finalized, Alfieri sued Solomon for legal malpractice based on the attorney’s actions in recommending the settlement.

To prove malpractice, Alfieri sought to introduce evidence of the private attorney/client communications before, during, and after the mediation. Solomon sought to strike introduction of the mediation communications under Oregon law. Under Oregon law, a mediation communication is “(a) All communications that are made, in the course of or in connection with a mediation, to a mediator, a mediation program or a party to, or any other person present at, the mediation proceedings.” ORS 36.110(7)(a). The trial court and court of appeals held that the pre-mediation communications between the attorney and client were mediation communications because they were made “in connection with a mediation.” If the communications are mediation communications, they would be considered confidential and inadmissible under Oregon law.

The Oregon Supreme Court read the definition of mediation narrowly, holding that mediation only includes the portions of the process “in which a mediator is a participant.” With mediation so narrowly defined, communications between an attorney and client outside of the part of the process in which a mediator is a participant are not protected. The result of this case is that the pre-mediation communications between an attorney and client are not protected.

Arguably, this case reaches the right result in this case, but does so in a way that highly jeopardizes the mediation process in almost every situation other than cases of legal malpractice. The difficulty in this case stems from the fact that the Oregon statute does not have an exception to confidentiality for claims of attorney malpractice. Such exception exists for cases of mediator malpractice, but not attorney malpractice. ORS 36.222(5).

From a practical standpoint, if the Oregon Supreme Court protected these pre-mediation attorney/client communications, then a lawyer may be essentially insulated from resulting malpractice in advising clients before, during, or after the mediation process (i.e., the parts of the mediation in which the mediator is not actually “present” for the discussions). The problem is, however, that pre-mediation communications in other contexts may not be protected, and they may be subject to discovery and admission at trial in any case.

Presumably, the attorney/client privilege would still hold strong for attorney/client communications prior to mediation in cases other than a case involving legal malpractice. Consider, however, the implications of pre-mediation communications with persons other than attorneys. Conversations made in anticipation for mediation with third parties may no longer be protected from disclosure, even if consulting with such third parties would greatly aid the settlement process.      

States that have enacted the Uniform Mediation Act should not encounter a similar type of ruling. The UMA makes an exception to the mediation privilege for communications offered to prove or disprove a claim of professional malpractice. UMA § 6(a)(6). For UMA states, the exception is clear, and the courts can allow the evidence in under this exception, rather than grappling with scope of how to define “mediation” and “mediation communication.”

This ruling is problematic and may change the way that lawyers prepare clients for mediation. Presumably, mediation works best when the parties are well prepared for the process and ready to discuss the issues, facts, and potential settlement options. If pre-mediation communications are not protected, rulings such as this may create a harmful disincentive to thoroughly prepare for the mediation process.