When considering various alternative dispute resolution options, mediation is a popular choice. However, the distinction between mediation, settlement conferences, and ordinary settlement negotiations can be confusing. This article examines applicable California rules in order to shed some light on what distinguishes mediation from other types of settlement negotiations.

What Qualifies as a Mediation in California?

1. Mediation Defined
As an initial matter, it is important to understand what qualifies as a mediation in California. The Evidence Code defines mediation as a process in which a neutral person or persons facilitate communication between the disputants to assist them in reaching a mutually acceptable agreement. Cal. Evid. Code section 1115(a). The California Supreme Court described mediation as the next step beyond direct negotiations and is an alternative to “unnecessarily costly, time-consuming, and complex” court proceedings. Foxgate Homeowners' Ass'n, Inc. v. Bramalea Calif., Inc., (2001) 26 Cal. 4th 1 at 14. See also T.J. Evans, M.C. Holden, and K.E. Mast., Advance Mediation Advocacy for Insurance Coverage Cases (“AMAICC”), ABA ICLC Seminar Publication (2018).

Upon reviewing the comments to section 1115, it becomes clear that what qualifies as a mediation is determined by “the nature of a proceeding, not its label,” and that a proceeding might qualify as a mediation for purposes of the Evidence Code’s confidentiality protections “even though it is denominated differently.” See Rebecca Callahan, Mediation Confidentiality: For California Litigants, Why Should Mediation Confidentiality be a Function of the Court in Which the Litigation is Pending?, 12 Pepperdine Disp. Res. L.J. 63 (2012); AMAICC at pp. 1-20.

2. Distinguishing A Mediation from a Mandatory Settlement Conference
It is critical that an attorney understand the difference between a mediation and a mandatory settlement conference. Although courts and practitioners sometimes use these terms interchangeably, these are very different alternative dispute resolution (“ADR”) procedures with vastly different confidentiality rules. Evidence Code section 1117(b)(2) provides that the confidentiality protections afforded to communications in mediation do not apply to communications during a mandatory settlement conference convened pursuant to rule 3.1380 of the California Rules of Court.

The first step in distinguishing a mediation from a mandatory settlement conference is determining whether or not a court has ordered the ADR process. The analysis will change depending on who initiated the ADR process. AMAICC at pp. 1-20.

Second, if a court has not ordered the ADR process, and instead the process is the result of an agreement between the parties, the parties are not participating in a mandatory settlement conference. Only a court can order the parties to participate in a mandatory settlement conference; it cannot be self-imposed. AMAICC at pp. 1-20.

Third, if a court has ordered the ADR process, you must carefully review the court order to determine whether or not the court has simply ordered the parties to participate in mediation or whether the court has specifically ordered the parties to participate in a mandatory settlement conference convened pursuant to rule 3.1380 of the California Rules of Court. AMAICC at pp. 1-20.

Finally, it almost goes without saying that if the court has ordered the parties to participate in a mandatory settlement conference convened pursuant to rule 3.1380 of the California Rules of Court, the parties are participating in a mandatory settlement conference and not a mediation. Conversely, if the court has ordered the parties to participate in mediation, the question of whether or not the parties are actually participating in mediation depends on whether a neutral is involved, as discussed below. AMAICC at pp. 1-20.

3. Distinguishing Mediation from Ordinary Settlement Negotiations
In many cases, the ADR process is initiated by the parties themselves and is not the result of a court order. Under these circumstances, it is important to distinguish a mediation from ordinary settlement negotiations. As noted above, mediation is a process in which a neutral person or persons facilitate communication between the disputants to assist them in reaching a mutually acceptable agreement. Cal. Evid. Code section 1115(a). Therefore, a neutral person or persons acting as a mediator is required for mediation. Mere settlement negotiations between the parties without a neutral person involved acting as a mediator do not qualify as mediation. AMAICC at pp. 1-20.

Who Qualifies as a Mediator In California?

As noted above, you cannot have a mediation in California without a mediator. The Evidence Code defines a mediator as a neutral person who conducts a mediation. It includes any person designated by a mediator either to assist in the mediation or to communicate with the participants in preparation for a mediation. Cal. Evid. Code section 1115(b). Simply put, a mediator is the neutral person who conducts the mediation and the members of their staff who assist with the mediation and/or communication with the participants in preparation for a mediation. AMAICC at pp. 1-20.

Most mediators are attorneys, many of them retired judges. But a mediator is not required to be an attorney and non-lawyers do serve as mediators, particularly those with expertise in a specialized area. See Cal. Prac. Guide Alt. Disp. Res. Ch. 3-B § 3:75; and AMAICC at pp. 1-20. Parties have many options to consider when selecting the appropriate mediator for their dispute. Unless the mediator is appointed by the court, all of the parties to the dispute must agree on the selection of the mediator. When making this decision, a party should consider the mediator’s reputation, level of experience, and potential for bias for or against the party. AMAICC at pp. 1-20.

What Is a Mediation Consultation?

A mediation consultation is defined as a communication between a person and a mediator for the purpose of initiating, considering, or reconvening a mediation or retaining the mediator. Cal. Evid. Code section 1115(c). Essentially, a mediation consultation includes any communications that a party has with a mediator or a member of the mediator’s staff for the purpose of initiating, considering, or reconvening a mediation or retaining the mediator. AMAICC at pp. 1-20.

Confidentiality Plays a Critical Role in Mediation

Confidentiality is one of the most important features of mediation. Nothing said or written during mediation or a mediation consultation is admissible in any noncriminal proceeding. Cal. Evid. Code section 1119. Confidentiality allows parties to negotiate freely with the understanding that their communications during mediation will remain confidential. California Courts have long held that the success of mediation depends on a candid and informal exchange among the parties and the mediator. See Cal. Prac. Guide Alt. Disp. Res. Ch. 3-B § 3:94; see also Rojas v. Sup.Ct. (Coffin), (2004) 33 Cal. 4th 407, 415; Simmons v. Ghaderi, (2008) 44 Cal. 4th 570, 578; and AMAICC at pp. 1-20. [Editor’s Note: The California Law Revision Commission recently proposed a new exception to confidentiality in cases of alleged attorney malpractice. The Legislature has declined to introduce such an exception but is considering requiring explicit disclosures to participants regarding confidentiality.]

Conclusion

Settlement negotiations can take on a variety of forms. It is important for California practitioners to familiarize themselves with the applicable procedural and evidentiary rules to ensure that their settlement communications are protected.