44 Cal. 4th 570, 187 P.3d 934, 80 Cal. Rptr. 3d 83
Filed 7/21/08
IN THE SUPREME COURT OF CALIFORNIA
MICHELLE SIMMONS, as Personal
Representative, etc., et al.,
Plaintiffs
and
Respondents,
S147848
v.
Ct.App. 2/3 B180735
LIDA GHADERI,
Los Angeles County
Defendant and Appellant.
Super. Ct. No. BC270780
Evidence Code section 1115 et seq.1 sets forth an extensive statutory
scheme protecting the confidentiality of mediation proceedings, with narrowly
delineated exceptions. In this breach of contract action arising from a medical
malpractice suit, plaintiffs sought to enforce an oral settlement agreement
allegedly formed during mediation. During pretrial proceedings, the doctor
stipulated to, and submitted evidence of, events which had occurred during
mediation, arguing that no enforceable contract was formed during mediation. For
the first time at trial, the doctor invoked the mediation confidentiality statutes to
prevent plaintiffs from introducing evidence relating to the mediation proceedings.
Over the doctor?s objection, the trial court admitted the evidence.
1
All further statutory references are to the Evidence Code.
1
A majority of the Court of Appeal held that, despite the statutory
confidentiality protections, the doctor was judicially estopped from arguing that
evidence of the settlement agreement is statutorily inadmissible; she ?placed
before the trial court the facts of the mediation and sought a legal determination as
to their effect.? We conclude that the Court of Appeal improperly relied on the
doctrine of estoppel to create a judicial exception to the comprehensive statutory
scheme of mediation confidentiality and that the evidence relating to the mediation
proceedings should not have been admitted at trial.
I. FACTUAL AND PROCEDURAL HISTORY
On March 27, 2002, plaintiffs (the minor son and mother of Kintausha
Clemmons) filed a wrongful death complaint against defendant Dr. Lida Ghaderi,
alleging that her medical malpractice caused the death of Kintausha Clemmons.
Cooperative of American Physicians, Inc./Mutual Protection Trust (CAP-MPT)
was defendant?s medical malpractice insurance provider.
On July 9, 2003, the parties attended a mediation with the Honorable
Robert T. Altman, retired. Plaintiffs and their counsel appeared. Defendant was
present with a CAP-MPT claims specialist, the CAP-MPT attorney, and Cumis
counsel.2 Under the provisions of her professional liability policy with CAP-
MPT, defendant had the right to withhold her consent to the settlement of any
third party malpractice claim. At the request of the mediator, before the beginning
of settlement discussions, defendant executed a standard consent-to-settlement
form provided by CAP-MPT. This document authorized CAP-MPT to negotiate a
2 Cumis counsel refers to independent counsel provided to an insured by an
insurer contesting coverage, but still providing a defense. (San Diego Federal
Credit Union v. Cumis Ins. Society, Inc. (1984) 162 Cal.App.3d 358, 364; (Civ.
Code, ? 2860.)
2
settlement on defendant?s behalf, with the settlement value limited to $125,000.
The document also stated that defendant?s consent to settlement could only be
revoked in writing and would remain in force until a written revocation was
received by CAP-MPT at its offices.
The parties then engaged in settlement discussions while defendant waited
in another room with Cumis counsel. At one point, CAP-MPT instructed Judge
Altman to offer plaintiffs $125,000 to settle the matter in exchange for a dismissal
with prejudice and a waiver of costs. Plaintiffs orally accepted the offer. Judge
Altman then placed the essential terms of the settlement into a document for the
parties to sign. When defendant was informed that the case had settled, she
declared that she was revoking her consent and left the building without signing
the settlement agreement. The claims specialist, unsure of how to proceed,
contacted the CAP-MPT office and learned that CAP-MPT would consider
defendant?s oral revocation of her consent valid. Plaintiffs and their counsel
signed the settlement agreement, but no one signed on behalf of defendant or
CAP-MPT.
The following day, plaintiffs? attorney and CAP-MPT?s attorney appeared
in court and sought guidance. Both counsel recounted the facts of the mediation to
the court, including defendant?s written consent to settle for $125,000, the offer in
that amount, the acceptance of the offer, and defendant?s departure while the
settlement was being reduced to writing. The trial court speculated that there may
be an enforceable oral settlement agreement. Accordingly, the trial court vacated
the trial date and set the matter for an order to show cause why the case should not
be dismissed.
On July 16, 2003, defendant sent CAP-MPT a letter formally revoking her
consent to settle.
3
At the July 29, 2003, dismissal hearing, defendant spoke with the trial
court. The court stated on the record that defendant was unwilling to consent to
the settlement, but then suggested that plaintiffs move to enforce the settlement
under Code of Civil Procedure section 664.6.3
On August 15, 2003, plaintiffs moved to enforce the settlement on the
ground that an oral agreement had been reached with CAP-MPT while CAP-MPT
had defendant?s consent to settle the action. Plaintiffs supported their motion with
a copy of defendant?s signed consent to settle, the written settlement agreement
prepared by Judge Altman and signed only by plaintiffs and their counsel, and
declarations from plaintiffs? attorney and the mediator setting forth the events at
the July 9 mediation.
In opposing plaintiffs? motion to enforce, defendant did not dispute their
factual representations regarding the mediation. Instead, arguing the legal effect
of those facts, she claimed that the settlement could not be enforced because it did
not meet the requirements of Code of Civil Procedure section 664.6. Defendant
argued that no agreement had been consummated; she had not signed the written
settlement agreement and had withdrawn her consent, and therefore CAP-MPT
had no authority to execute a settlement agreement on her behalf. The trial court
denied the motion to enforce settlement. It found that, because neither defendant
nor CAP-MPT had signed the written agreement, the requirements of Code of
Civil Procedure section 664.6 had not been met. However, it noted there might be
3
Code of Civil Procedure section 664.6 states, ?If parties to pending
litigation stipulate, in a writing signed by the parties outside the presence of the
court or orally before the court, for settlement of the case, or part thereof, the
court, upon motion, may enter judgment pursuant to the terms of the settlement. If
requested by the parties, the court may retain jurisdiction over the parties to
enforce the settlement until performance in full of the terms of the settlement.?
4
an enforceable oral contract and suggested plaintiffs amend their complaint to
allege breach of contract.
Following the trial court?s suggestion, plaintiffs amended their complaint to
add a cause for breach of contract and alleged that defendant breached an oral
settlement agreement reached during mediation. Plaintiffs served a request for
admissions on defendant and deposed her. In response to this discovery and in her
motion for summary adjudication of the breach of contract cause, defendant did
not dispute the events that had occurred during the mediation. Indeed, in a
declaration appended to her motion, defendant proffered that she had signed a
written consent for CAP-MPT to settle, her counsel had made a $125,000
settlement offer to plaintiffs, and she had revoked her consent without executing
the settlement agreement.
The trial court denied defendant?s motion for summary adjudication of the
breach of contract cause of action and granted plaintiffs? motion to sever the
breach of contract and medical malpractice claims. The case proceeded to trial
only on the breach of contract cause.
On October 6, 2004, nearly 15 months after the mediation, defendant filed
her trial brief. For the first time, she asserted that the mediation confidentiality
statutes precluded plaintiffs from proving the existence of an oral settlement
agreement. Defendant?s trial brief raised no other issue.
At a bench trial, over defendant?s objection, plaintiffs submitted the
following documents relating to the mediation: (1) the consent to settlement
signed by defendant; (2) the settlement agreement prepared by Judge Altman; (3)
defendant?s letter revoking her consent to settlement; (4) defendant?s deposition
testimony; (5) the deposition testimony of the CAP-MPT claims specialist; and (6)
a declaration from Judge Altman. The parties agreed to almost everything that had
occurred at the mediation, except what the CAP-MPT claims specialist did once
5
defendant had refused to sign the document. Over defendant?s objection, the
CAP-MPT claims specialist testified about the events of the mediation.
The trial court concluded that plaintiffs and defendant?s agent, acting
within his authority as evidenced by defendant?s signed consent agreement, had
entered into a valid, enforceable oral contract before defendant withdrew her
consent. It ordered specific performance of the agreement and entered judgment
in favor of plaintiffs for $125,000, plus prejudgment interest.
In a two-to-one decision, the Court of Appeal affirmed the trial court?s
judgment. The majority held that a valid oral agreement had been reached during
mediation. It further held that, because defendant had presented evidence of the
occurrences at the mediation and failed to object to plaintiffs? use of these facts
during pretrial motions, she was estopped from asserting mediation
confidentiality. In his dissent, Justice Aldrich maintained that the mediation
confidentiality statutes prevented plaintiffs from proving the existence of an oral
settlement agreement, that the majority?s focus on estoppel was ?a veiled attempt
at relabeling waiver as estoppel,? and that a party cannot impliedly waive
mediation confidentiality through litigation conduct.
We granted defendant?s petition for review to determine if she could be
estopped from objecting to the admission of evidence proving the existence of an
oral settlement agreement reached during mediation proceedings.
II. DISCUSSION
Defendant contends that the Court of Appeal majority improperly relied on
the doctrine of estoppel to create a judicial exception to the statutory requirements
of confidentiality of mediation proceedings. (? 1115 et. seq.) As explained
below, we agree.
6
1. The Mediation Confidentiality Statutes
In 1997, the Legislature adopted the California Law Revision
Commission?s (Commission) recommendations and revised the mediation
confidentiality statutes. (Fair v. Bakhtiari (2006) 40 Cal.4th 189, 194-196 (Fair).)
It enacted section 1115 et seq., creating an extensive statutory scheme governing
mediation confidentiality and its exceptions. (Fair, supra, at pp. 194-196.)
?California?s Legislature has a strong policy favoring mediation as an
alternative to litigation. Because mediation provides a simple, quick, and
economical means of resolving disputes, and because it may also help reduce the
court system?s backlog of cases, it is in the public interest to encourage its use.
[Citation.]? (Doe 1 v. Superior Court (2005) 132 Cal.App.4th 1160, 1165.) The
Legislature designed the mediation confidentiality statutes to ?promote ?a candid
and informal exchange regarding events in the past . . . . This frank exchange is
achieved only if the participants know that what is said in the mediation will not
be used to their detriment through later court proceedings and other adjudicatory
processes.? [Citations.]? (Foxgate Homeowners? Assn., Inc. v. Bramalea
California, Inc. (2001) 26 Cal.4th 1, 14 (Foxgate).) ?[C]onfidentiality is essential
to effective mediation . . . .? (Ibid.)
Section 1119 governs the general admissibility of oral and written
communications made during the mediation process. It ?prohibits any person,
mediator and participants alike, from revealing any written or oral communication
made during mediation.? (Foxgate, supra, 26 Cal.4th at p. 13.) Section 1119,
subdivision (a) states, in pertinent part, that: ?Except as otherwise provided in this
chapter: [?] (a) No evidence of anything said or any admission made for the
purpose of, in the course of, or pursuant to, a mediation . . . is admissible or
subject to discovery, and disclosure of the evidence shall not be compelled, in
any . . . civil action . . . .?
7
Similarly, section 1119, subdivision (b) states, in pertinent part, that:
?Except as otherwise provided in this chapter: [?] . . . [?] No writing . . . that is
prepared 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
writing shall not be compelled, in any . . . civil action. . . .? Section 1119,
subdivision (c) further mandates that ?All communications, negotiations, or
settlement discussions by and between participants in the course of a
mediation . . . shall remain confidential.?
Sections 1122 and 1124 specifically lay out exceptions for the admission of
evidence produced during mediation. As relevant here, section 1122, subdivision
(a)(1) provides that ?[a] communication or a writing . . . that is made or prepared
for the purpose of, or in the course of, or pursuant to, a mediation or a mediation
consultation, is not made inadmissible, or protected from disclosure, by provisions
of this chapter if . . . the following condition[] is satisfied: [?] (1) All persons
who conduct or otherwise participate in the mediation expressly agree in writing,
or orally in accordance with Section 1118, to disclosure of the communication,
document, or writing.?
Section 1124 specifies that an oral agreement made in the course of, or
pursuant to, a mediation is not made inadmissible, or protected from disclosure, if
certain conditions involving section 1118 are satisfied.4 Oral agreements in
4 Section
1124
states:
?An oral agreement made in the course of, or pursuant to, a mediation is not
made inadmissible, or protected from disclosure, by the provisions of this chapter
if any of the following conditions are satisfied:
?(a) The agreement is in accordance with Section 1118.
(footnote continued on next page)
8
accordance with section 1118 occur when: (a) the oral agreement is recorded by a
court reporter, tape recorder, or other reliable means of sound recording; (b) the
terms of the oral agreement are recited on the record in the presence of the parties
and the mediator, and the parties express on the record that they agree to the terms
recited; (c) the parties to the oral agreement expressly state on the record that the
agreement is enforceable or binding or words to that effect; and (d) the recording
is reduced to writing and the writing is signed by the parties within 72 hours after
it is recorded.
The legislative scheme also provides rules for the use of written settlement
agreements produced during mediation. Section 1123 protects the confidentiality
of any written agreement made during mediation unless the parties expressly agree
to disclosure or the agreement is used to show fraud, duress, or illegality.5
(footnote continued from previous page)
?(b) The agreement is in accordance with subdivisions (a), (b), and (d) of
Section 1118, and all parties to the agreement expressly agree, in writing or orally
in accordance with Section 1118, to disclosure of the agreement.
?(c) The agreement is in accordance with subdivisions (a), (b), and (d) of
Section 1118, and the agreement is used to show fraud, duress, or illegality that is
relevant to an issue in dispute.?
5 Section
1123
reads:
?A written settlement agreement prepared in the course of, or pursuant to, a
mediation, is not made inadmissible, or protected from disclosure, by provisions of
this chapter if the agreement is signed by the settling parties and any of the
following conditions are satisfied:
?(a) The agreement provides that it is admissible or subject to disclosure, or
words to that effect.
(footnote continued on next page)
9
Further, statements made during mediation and mediation materials are
confidential not only during the mediation, but also after the mediation ends.
Section 1126 clarifies that ?[a]nything said, any admission made, or any writing
that is inadmissible, protected from disclosure, and confidential under this chapter
before a mediation ends, shall remain inadmissible, protected from disclosure, and
confidential to the same extent after the mediation ends.?
In addition to the unambiguous language of the mediation confidentiality
statutes, the Commission?s comments further demonstrate that the Legislature
intended to apply confidentiality broadly and to limit any exceptions to
confidentiality to narrowly prescribed statutory exemptions. (Fair, supra, 40
Cal.4th at p. 195 [the ?Commission?s official comments are deemed to express the
Legislature?s intent?].) The Commission?s comment to section 1124 states
explicitly that the section sets forth specific circumstances under which mediation
confidentiality is inapplicable to an oral agreement reached through mediation.
Except in those circumstances, sections 1119 and 1124 codify the rule of Ryan v.
Garcia (1994) 27 Cal.App.4th 1006 (Ryan) (mediation confidentiality applies to
oral statement of settlement terms) and reject the contrary approach of Regents of
the University of California v. Sumner (1996) 42 Cal.App.4th 1209 (Regents)
(footnote continued from previous page)
?(b) The agreement provides that it is enforceable or binding or words to
that effect.
?(c) All parties to the agreement expressly agree in writing, or orally in
accordance with Section 1118, to its disclosure.
?(d) The agreement is used to show fraud, duress, or illegality that is
relevant to an issue in dispute.?
10
(mediation confidentiality does not protect oral statement of settlement terms).
(Cal. Law Revision Com. com., 29B pt. 3 West?s Ann. Evid. Code (2008 supp.)
(hereafter Cal. Law Rev. Com.) foll. ? 1124, p. 257.)
As noted in the Commission?s comment, with section 1124 the Legislature
created a specific mechanism for the admission of evidence regarding oral
settlement agreements made during mediation. This mechanism was created in
reaction to two conflicting Court of Appeal decisions, Ryan and Regents.
In
Ryan, supra, 27 Cal.App.4th at page 1013, the Court of Appeal held that
under former section 1152.5 (now section 1119), evidence offered to prove the
terms of an oral settlement agreement reached during mediation was inadmissible
because it did not meet statutory requirements. In Ryan, the parties went to
mediation, agreed to a compromise, and orally recited the terms of the agreement.
(Id. at pp. 1008-1009.) The agreement, however, was never reduced to writing,
and the defendant later contested the terms of the settlement. (Ibid.) The plaintiffs
amended their complaint to add a cause of action to enforce the oral settlement.
(Id. at p. 1009.) Over defendant?s objections, the trial court admitted evidence of
the oral recitation of the settlement terms to prove the existence of an agreement.
(Ibid.) The court reasoned that once the mediator announced the compromise,
statements made thereafter were not produced in the course of mediation and were
not protected under section 1152.5. (Ryan, at p. 1009.)
The defendant appealed, claiming the statements concerning the existence
and terms of the settlement agreement were part of the mediation and therefore
inadmissible. (Ryan, supra, 27 Cal.App.4th at p. 1010.) Noting that former
section 1152.5 should be broadly interpreted to ensure confidentiality, the Court of
Appeal held that the oral statements made after the announced compromise were
made in ?the course of mediation.? (Ryan, at p. 1013.) The court rejected the
plaintiffs? argument that such interpretation of the statutory scheme would divest
11
mediation of its intended usefulness, and it noted that the statutes provided a
procedural mechanism to protect confidentiality and simple and clear means for
enforcement of agreed-upon settlements. (Id. at p. 1012.)
Subsequently,
in
Regents, supra, 42 Cal.App.4th 1209, the Court of Appeal
declined to follow Ryan and held that former section 1152.5 did not bar
introduction of oral statements evidencing a settlement made after a compromise
had been achieved. Although the Court of Appeal acknowledged its decision
contradicted Ryan, it nonetheless concluded that a trial court could admit evidence
of oral statements made after a compromise had been reached. (Regents, supra, 42
Cal.App.4th at p. 1213.)
The
Regents rule, however, was expressly rejected by the Legislature when
it revised the mediation confidentiality statutes. The Commission?s comment to
section 1124 provides that, except when the requirements expressly laid out in
sections 1124 and 1118 are met, sections 1119 and 1124 together codify the rule
of Ryan and reject Regents. (Cal. Law Rev. Com., supra, foll. ? 1124, p. 257.)
Section 1119 is more expansive than its predecessor, former section 1152.5.
Section 1119, subdivision (a), extends to oral communications made for the
purpose of or pursuant to a mediation, not just oral communications made in the
course of the mediation. (Cal. Law Rev. Com., supra, foll. ? 1119, p. 241.) It also
explicitly applies in a subsequent arbitration or administrative adjudication, as
well as in any civil proceeding. (Ibid.) Recognizing both the breadth and clarity
of the mediation confidentiality statutes, we have concluded that the legislative
scheme is clear and unambiguous, and that the Legislature intended for mediation
confidentiality to apply according to the statutory rules. (Foxgate, supra, 26
Cal.4th at p. 14.) Thus, mediation confidentiality now clearly applies to prohibit
admissibility of evidence of settlement terms made for the purpose of, in the
12
course of, or pursuant to a mediation unless the agreement falls within express
statutory exceptions. (? 1119, subd. (a).)
In the present case, an oral agreement may have been reached between
defendant?s insurer and plaintiffs during the mediation; however, the parties did
not follow the statutory procedures that would have made this agreement
admissible. Specifically, no form of recordation of the oral agreement exists, nor
is there a written agreement signed by both parties. (?? 1118, 1122, 1124.) The
agreement as memorialized by Judge Altman is similarly inadmissible under
sections 1119, 1122, and 1123, as there was no express agreement that it
could be disclosed, and it was not signed by defendant or her attorneys. The Court
of Appeal and the parties do not dispute that evidence of the oral settlement
agreement was inadmissible under the statutory requirements.
2. Judicially Created Exceptions to Mediation Confidentiality
Nevertheless, the Court of Appeal majority relied on the doctrine of
estoppel to ?prevent a litigant from tardily relying on mediation confidentiality to
shield from the court facts which she had stipulated to be true and had extensively
litigated without raising such bar.? The dissenting opinion noted, however, that,
?[b]y focusing on estoppel, the majority in essence is attempting to create a new
exception to the comprehensive scheme.? We agree with this latter
characterization.
On limited occasions, courts have crafted exceptions to mediation
confidentiality and compelled mediators to testify in civil actions. However, those
instances are very limited. In Rinaker v. Superior Court (1998) 62 Cal.App.4th
155, 167, the court compelled a mediator to testify because it found that a minor?s
due process right to confrontation of witnesses outweighed the statutory right to
mediation confidentiality. In Olam v. Congress Mortgage Co. (N.D.Cal. 1999) 68
13
F.Supp.2d 1110, 1118-1119, 1129, the parties themselves expressly waived
confidentiality. Because of this waiver, the court found that the policy driving
mediation confidentiality had appreciably less force. (Id. at p. 1133.)
Except in cases of express waiver or where due process is implicated, we
have held that mediation confidentiality is to be strictly enforced. In Foxgate, we
addressed the general validity of judicially crafted exceptions to mediation
confidentiality. (Foxgate, supra, 26 Cal.4th 1.) There, the Court of Appeal found
an exception to section 1119 that would allow a mediator to report a party?s failure
to participate in good faith in the mediation process. (Foxgate, supra, 26 Cal.4th
at p. 9.) We held that the Court of Appeal erred in judicially creating an exception
to section 1119. Distinguishing Rinaker and Olam, we noted that where a
supervening due process right is not implicated or where no express waiver of
confidentiality exists, judicially crafted exceptions to mediation confidentiality are
not appropriate. (Foxgate, at pp. 15-17.) To this end, we announced that in order
?[t]o carry out the [legislative] purpose of encouraging mediation by ensuring
confidentiality, the statutory scheme . . . unqualifiedly bars disclosure of
communications made during mediation absent an express statutory exception.?
(Id. at p. 15, fn. omitted.) Further, judicial construction of unambiguous statutes is
appropriate only when literal interpretation would yield absurd results. (Id. at p.
14.)
In deciding whether a judicial exception was appropriate to carry out the
Legislature?s goals, we observed that with the enactment of the mediation
confidentiality statutes, the Legislature contemplated that some behavior during
mediation would go unpunished. (Foxgate, supra, 26 Cal.4th at p. 17.) The
Legislature was also presumably aware that general sanctions statutes permit
punishing bad faith conduct. Considering this, we reasoned we were bound to
respect the Legislature?s policy choice to protect mediation confidentiality rather
14
than create a procedure that encouraged good faith participation in mediation.
Thus, we held that evidence of a party?s bad faith during the mediation may not be
admitted or considered. (Ibid.)
We subsequently reaffirmed that the mediation confidentiality statutes
unqualifiedly bar disclosure of certain communications and writings produced in
mediation absent an express statutory exception. (Rojas v. Superior Court (2004)
33 Cal. 4th 407 (Rojas).) In Rojas, the Court of Appeal concluded that, like work
product, certain derivative materials exchanged during mediation were
discoverable on a good cause showing. (Id. at p. 414.) Rejecting this conclusion,
we noted that section 2018 of the Code of Civil Procedure codified the good cause
exception to the work product doctrine; the Legislature clearly knew how to enact
a statutory good cause exception to the mediation confidentiality statutes, but it
chose not to do so. (Rojas, at p. 423.) Furthermore, the Legislature has enacted
other statutory exceptions to mediation confidentiality. ? ?Under the maxim of
statutory construction, expressio unius est exclusio alterius, if exemptions are
specified in a statute, [courts] may not imply additional exemptions unless there is
a clear legislative intent to the contrary. [Citation.]? ? (Id. at p. 424.) Finding no
such intent, we concluded that judicial exceptions should not be read into
Evidence Code section 1119. (Rojas, at p. 424; Fair, supra, 40 Cal.4th at p. 194
[reaffirming the disapproval of judicially crafted exceptions to the mediation
confidentiality statutes].)
Like
Foxgate and Rojas, the present case does not implicate any due
process right equivalent to the right bestowed by the confrontation clause of the
United States Constitution, nor have the parties executed express waivers of
confidentiality. Thus, Rinaker and Olam are distinguishable, and their rationale
inapplicable. Instead, by creating fixed procedures that allow only certain
evidence produced at mediation to be admitted in later civil proceedings, the
15
Legislature was undeniably aware that some agreements made during mediation
would not be enforceable. The statutes thus reflect a policy judgment made by the
Legislature when weighing the value of confidentiality. Creating exceptions to
admit evidence that does not meet statutory requirements would run contrary to
legislative intent.
3. Estoppel
Despite the clear legislative intent, the Court of Appeal majority
nonetheless estopped the defendant from invoking mediation confidentiality
because she herself used and did not object to plaintiffs? use of evidence
describing the events of mediation.
The estoppel cases on which the Court of Appeal relied are inapt. The
majority concluded that, ?once a party voluntarily declares certain facts to be true,
stipulates that she does not dispute them and extensively litigates the legal effect
of such facts, she is estopped to later claim that the court must disregard those
facts based upon a belated assertion of mediation confidentiality.? To support this
statement, the majority opinion relied on Gee v. American Realty & Construction,
Inc. (2002) 99 Cal.App.4th 1412, 1414, and Conservatorship of Kevin M. (1996)
49 Cal.App.4th 79, 92. These cases involved estoppel to contest jurisdiction. That
doctrine provides that when a court has subject matter jurisdiction over an action,
?a party who seeks or consents to action beyond the court?s power as defined by
statute or decisional rule may be estopped to complain of the ensuing action in
excess of jurisdiction.? (In re Griffin (1967) 67 Cal.2d 343, 347.)
As Justice Aldrich noted in his dissent, defendant does not contest the
jurisdiction of the court over the breach of contract matter. Similarly, she did not
use or initiate a procedure and then argue against its use in court. Here, estoppel
to contest jurisdiction does not apply; defendant never asked the court to act in
16
excess of its jurisdiction and then argued that the court had no power to act as it
did. Instead, defendant consistently invoked the court?s jurisdiction throughout
the litigation proceedings, maintaining that there was no enforceable settlement
agreement either because substantively such agreement did not occur or because
plaintiffs could not procedurally prove its existence.
Like estoppel to contest jurisdiction, equitable estoppel also does not apply.
A valid claim for equitable estoppel requires: (a) a representation or concealment
of material facts; (b) made with knowledge, actual or virtual, of the facts; (c) to a
party ignorant, actually and permissibly, of the truth; (d) with the intention, actual
or virtual, that the ignorant party act on it; and (e) that party was induced to act on
it. (13 Witkin, Summary of Cal. Law (10th ed. 2005) Equity, ? 191, pp. 527-528.)
There can be no estoppel if one of these elements is missing. (Id. at p. 528.) Here,
plaintiffs were never ignorant of the facts, nor did they change their position in
reliance on defendant?s position. Thus, estoppel principles do not apply.
4. Waiver
The Court of Appeal dissenting opinion more accurately portrays the
substance of this case when it characterizes the majority?s decision as ?a veiled
attempt at relabeling waiver as estoppel.? The facts of this case reveal that the real
issue is whether a party can impliedly waive mediation confidentiality through
litigation conduct. Indeed, plaintiffs now argue in this court that defendant waived
mediation confidentiality through her litigation conduct.
Civil Code section 3513 makes the doctrine of waiver applicable to all
rights and privileges that a person is entitled to, including those conferred by
statute, unless otherwise prohibited by specific statutory provisions. (OutBoard
Marine Corp. v. Superior Court (1975) 52 Cal.App.3d 30, 41.) Thus, whether or
17
not implied waiver applies to mediation confidentiality is ultimately an issue of
statutory interpretation.
In arguing that defendant impliedly waived mediation confidentiality,
plaintiffs refer to language in Regents, supra, 42 Cal.App.4th at page 1213, and
Foxgate, supra, 26 Cal.4th at page 10, footnote 7. In Regents, the court held that a
party may waive mediation confidentiality through conduct. In Foxgate, we
simply described the Regents holding in a footnote without endorsing the Regents
decision. In revising the mediation confidentiality statutes, the Legislature cast
doubt on Regents when it specifically rejected its holding. Thus, these cases do
not provide support to plaintiffs.
Indeed, when interpreting the current mediation confidentiality statutes, at
least one court has held that mediation confidentiality cannot be impliedly waived
through conduct. (Eisendrath v. Superior Court (2003) 109 Cal.App.4th 351, 360-
365 (Eisendrath).) In Eisendrath, a husband (plaintiff) and wife (defendant)
agreed to undergo mediation of their divorce pursuant to the statutory rules set
forth in section 1115 et seq. (Eisendrath, at p. 354.) The trial court entered
judgment pursuant to the settlement reached at mediation, and the plaintiff filed a
motion to correct or reform the judgment after both parties remarried. (Id. at p.
355.) The defendant then sought to depose the mediator, and the plaintiff
opposed, citing mediation confidentiality. (Id. at p. 356.) The trial court held that
the plaintiff impliedly waived confidentiality by raising a claim about the
agreement in court and revealing communications that had occurred at the
mediation in his declaration. (Id. at pp. 356-357.) The plaintiff appealed. (Id. at
p. 357.)
18
On appeal, the defendant argued that mediation confidentiality is akin to the
evidentiary privileges laid out in section 910 et seq., privileges that section 912
states may be waived by conduct.6 (Eisendrath, supra, 109 Cal.App.4th at p.
357.) Because the plaintiff raised the issue with his suit and in supporting
declarations, the defendant argued he could not claim confidentiality. (Ibid.) The
Court of Appeal concluded that the implied waiver provisions in section 910 et
seq., by their plain language, are limited to the particular privileges enumerated
therein and therefore do not extend to mediation confidentiality. (Eisendrath, at p.
363.)
A court may not extend waiver provisions beyond their statutory existing
limits. (See Roberts v. City of Palmdale (1993) 5 Cal.4th 363, 373.) Furthermore,
courts may not add to statutory privileges except as required by federal and state
constitutional law; nor may a court imply exceptions to existing statutory
privileges. (Ibid.) Accordingly, Eisendrath correctly concludes that section 912
cannot be expanded beyond its express limits.
We must still determine whether the mediation confidentiality statutes
themselves permit implied waiver. Section 1122, the section dealing expressly
with waiver, states that a communication made during mediation is not
inadmissible if ?[a]ll persons who conduct or otherwise participate in the
mediation expressly agree in writing, or orally in accordance with Section 1118, to
disclosure . . . .? (? 1122, subd. (a)(1), italics added.) Furthermore, the
Commission?s comments provide, ?[s]ubdivision (a)(1) [of section 1122] states the
6
Such privileges include the lawyer-client privilege (? 954); the privilege for
confidential marital communications (? 980); the physician-patient privilege (?
994); the psychotherapist-patient privilege (? 1014); the clergymember-penitent
privilege (?? 1033, 1034); the sexual assault victim-counselor privilege
(? 1035.8); and the domestic violence victim-counselor privilege (? 1037.5).
19
general rule that mediation documents and communications may be admitted or
disclosed only upon agreement of all participants, including not only parties but
also the mediator and other nonparties attending the mediation . . . . Agreement
must be express, not implied.? (Cal. Law Rev. Com., supra, foll. ? 1122, p. 252,
italics added.) The comment continues, ?For exceptions to Section 1122, see
Sections 1123 (written settlement agreements reached through mediation) and
1124 (oral agreements reached through mediation).? (Ibid.)
Because the language of section 1122 unambiguously requires express
waiver, judicial construction is not permitted unless the statutes cannot be applied
according to their terms or doing so would lead to absurd results, thereby violating
the presumed intent of the Legislature. (Foxgate, supra, 26 Cal.4th at p. 14.)
Moreover, because the Legislature provided express exceptions to section 1119,
? ?[u]nder the maxim of statutory construction, expressio unius est exclusio
alterius, . . . we may not imply additional exemptions unless there is a clear
legislative intent to the contrary. [Citation.]? ? (Rojas, supra, 33 Cal.4th at p.
424.)
Plaintiffs argue that allowing defendant to assert mediation confidentiality
after litigating various pretrial motions would produce absurd results. In
Eisendrath, supra, 109 Cal.App.4th at pages 363-364, the Court of Appeal
concluded that judicial modification of the mediation confidentiality scheme was
not required to prevent absurd results or to fulfill legislative intent. On the facts of
that case, the result was not absurd because without express waivers, neither the
plaintiff nor the defendant could introduce evidence of what had happened at
mediation. (Ibid.) However, the court also found that the result was not absurd on
a more general level; the court remarked that Foxgate recognized that the
mediation confidentiality statutes effectively give control over evidence of certain
misconduct to the party engaged in the misconduct. (Eisendrath, at p. 365.)
20
Nonetheless, in Foxgate, we found it dispositive that ?none of the confidentiality
statutes currently make an exception for reporting bad faith conduct . . . when
doing so would require disclosure of communications . . . .? (Foxgate, supra, 26
Cal.4th at p. 17.) Accordingly, the Eisendrath court concluded, ?[f]ollowing the
Foxgate court, we assume that the Legislature considered these limitations on the
presentation of evidence when it enacted the statutory scheme.? (Eisendrath,
supra, 109 Cal.App.4th at p. 365.)
Here, the clear language of the statutory scheme and other indications of
legislative intent reflect that disallowing an implied waiver would not produce
absurd consequences, but was rather an intended consequence. First, as the court
in Eisendrath noted, section 1119 sweeps broadly and renders all communications
and writings made during mediation inadmissible except as otherwise specified in
the statutes. (Eisendrath, supra, 109 Cal.App.4th at p. 364.) Section 1122 plainly
states that mediation communications or writings may be admitted only on
agreement of all participants. Such agreement must be express, not implied. We
recognized that the Legislature intended section 1122 to give litigants control over
whether a mediation communication will be used in subsequent litigation. (See
Rojas, supra, 33 Cal.4th at p. 423.) However, the section does not limit this
control other than as stated through sections 1123 and 1124. (Cal. Law Rev.
Com., supra, foll. ? 1122, p. 252.) Thus, the language of the statutory scheme
reflects that it was intended to be complete.
Section 912, regarding the waiver of privileges, further shows that the
Legislature did not intend for implied waiver to apply to mediation confidentiality.
Section 912 existed when the Legislature drafted section 1115 et seq. In Foxgate,
we noted that Code of Civil Procedure section 128.5 allowed a court to sanction
bad faith behavior. (Foxgate, supra, 26 Cal.4th at p. 17.) Yet, we observed that
no confidentiality statute made an exception for reporting bad faith conduct
21
through the disclosure of mediation communications. (Ibid.) Similarly, the
Legislature is capable of drafting statutes that allow for implied waivers of
confidentiality through conduct, but it did not do so in section 1122 or anywhere
within the mediation confidentiality statutes. The Legislature is assumed to have
considered the limitations on the presentation of evidence when it enacted the
statutory scheme. (See Foxgate, at p. 17.)
Section 1115?s placement within the Evidence Code further supports the
conclusion that implied waiver does not apply to mediation confidentiality.
Unlike the privileges subject to implied waiver that are found in division 8,
entitled ?Privileges,? the Legislature placed section 1115 et seq. in division 9,
entitled ?Evidence Affected or Excluded by Extrinsic Policies.? This placement
reflects that the Legislature considered the specific limitations placed on the
admissibility of evidence by the mediation confidentiality statutes and endorsed
those limitations to encourage mediation as a matter of public policy.
Finally, the legislative history of the mediation confidentiality statutes as a
whole reflects a desire that section 1115 et seq. be strictly followed in the interest
of efficiency. By laying down clear rules, the Legislature intended to reduce
litigation over the admissibility and disclosure of evidence regarding settlements
and communications that occur during mediation. (Recommendation on
Mediation Confidentiality (Jan. 1997) 26 Cal. Law Revision Com. Rep. (1996) p.
424.) Allowing courts to craft judicial exceptions to the statutory rules would run
counter to that intent.
Both the clear language of the mediation statutes and our prior rulings
support the preclusion of an implied waiver exception. The Legislature chose to
promote mediation by ensuring confidentiality rather than adopt a scheme to
ensure good behavior in the mediation and litigation process. The mediation
statutes provide clear and comprehensive rules reflecting that policy choice.
22
Here, the mediation confidentiality statutes made inadmissible all evidence
of an oral contract between plaintiffs and defendant during mediation. Thus, there
was no evidence to prove plaintiffs? breach of contract claim, and defendant was
entitled to judgment as a matter of law. However, plaintiffs may still pursue their
medical malpractice cause of action before the trial court.
III. DISPOSITION
We reverse the judgment of the Court of Appeal and remand the case to
that court for further proceedings consistent with this opinion.
CHIN, J.
WE CONCUR:
GEORGE, C.J.
KENNARD, J.
BAXTER, J.
WERDEGAR, J.
MORENO, J.
CORRIGAN, J.
23
See next page for addresses and telephone numbers for counsel who argued in Supreme Court.
Name of Opinion Simmons v. Ghaderi
__________________________________________________________________________________
Unpublished Opinion
Original Appeal
Original Proceeding
Review Granted XXX 143 Cal.App.4th 410
Rehearing Granted
__________________________________________________________________________________
Opinion No.
S147848
Date Filed: July 21, 2008
__________________________________________________________________________________
Court:
Superior
County: Los Angeles
Judge: Richard L. Fruin, Jr.
__________________________________________________________________________________
Attorneys for Appellant:
Morrison & Foerster, Shirley M. Hufstedler, Sarvenaz Bahar; Reback, McAndrews & Kjar, Robert C.
Reback and Melanie Shornick for Defendant and Appellant.
Law Office of Ivan K. Stevenson and Ivan K. Stevenson for Confidential Mediation & Dispute Resolution
and Southern California Mediation Association as Amici Curiae on behalf of Defendant and Appellant.
James R. Madison; Farbstein & Blackman and John S. Blackman for California Dispute Resolution
Council as Amicus Curiae on behalf of Defendant and Appellant.
__________________________________________________________________________________
Attorneys for Respondent:
Law Offices of James Aaron Pflaster, Martin R. Berman, Stephanie C. Pflaster and James Aaron Pflaster
for Plaintiffs and Respondents.
Counsel who argued in Supreme Court (not intended for publication with opinion):
Shirley M. Hufstedler
Morrison & Foerster
555 West Fifth Street, Suite 3500
Los Angeles, CA 90013-1024
(213-892-5200
Martin R. Berman
Law Offices of James Aaron Pflaster
11835 West Olympic Boulevard, Suite 1235 East
Los Angeles, CA 90064
(310) 445-3381