BILL NUMBER: AB 939 CHAPTERED
BILL TEXT
CHAPTER 772
FILED WITH SECRETARY OF STATE OCTOBER 8, 1997
APPROVED BY GOVERNOR OCTOBER 7, 1997
PASSED THE ASSEMBLY SEPTEMBER 12, 1997
PASSED THE SENATE SEPTEMBER 8, 1997
AMENDED IN SENATE SEPTEMBER 4, 1997
AMENDED IN SENATE AUGUST 25, 1997
AMENDED IN SENATE JULY 10, 1997
AMENDED IN SENATE JUNE 11, 1997
AMENDED IN ASSEMBLY APRIL 9, 1997
INTRODUCED BY Assembly Member Ortiz
(Principal coauthor: Assembly Member Ackerman)
FEBRUARY 27, 1997
An act to amend Section 467.5 of the Business and Professions
Code, to amend Section 1775.10 of the Code of Civil Procedure, to
amend and renumber the heading of Chapter 2 (commencing with Section
1150) of Division 9 of, to add Chapter 2 (commencing with Section
1115) to Division 9 of, and to repeal Sections 1152.5 and 1152.6 of,
the Evidence Code, to amend Sections 66032 and 66033 of the
Government Code, to amend Sections 10089.80 and 10089.82 of the
Insurance Code, to amend Section 65 of the Labor Code, and to amend
Section 350 of the Welfare and Institutions Code, relating to
mediation.
LEGISLATIVE COUNSEL'S DIGEST
AB 939, Ortiz. Mediation.
(1) Under existing law, when a person consults a mediator or
mediation service for the purpose of retaining mediation services, or
when persons agree to conduct and participate in a mediation for the
purpose of compromising, settling, or resolving a civil dispute,
anything said in the course of a consultation for mediation services
or in the course of the mediation is not admissible in evidence nor
subject to discovery, and all communications, negotiations, and
settlement discussions by and between participants or mediators are
confidential, except as specified. If the testimony of a mediator is
sought to be compelled in any civil action or proceeding regarding
anything said in the course of a mediation, the court is required to
award reasonable attorney's fees and costs to the mediator against
the person seeking the testimony. Existing law provides that a
mediator may not file, and a court may not consider, any declaration
or finding of any kind by the mediator, except as specified.
This bill would, among other things, revise and recast these
provisions, as specified, define the terms "mediation," "mediator,"
and "mediation consultation," specify when a mediation ends, and make
corresponding changes.
(2) Existing law provides that if an insured party and an insurer
reach an agreement proposed during mediation, the insured will have 3
business days to rescind the agreement.
This bill would provide that if such rescission occurs, the
agreement may not be admitted or disclosed unless all the parties to
the agreement agree to its disclosure.
(3) Existing law provides that records of the Department of
Industrial Relations relating to labor disputes are confidential,
except that any decision or award arising out of arbitration
proceedings shall be a public record.
This bill would apply the provisions of this bill described in (1)
above to a mediation conducted by the California State Mediation and
Conciliation Service, and any person conducting the mediation. It
would provide that all other records relating to labor disputes are
confidential, except as specified.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 467.5 of the Business and Professions Code is
amended to read:
467.5. Notwithstanding the express application of Chapter 2
(commencing with Section 1115) of Division 9 of the Evidence Code to
mediations, all proceedings conducted by a program funded pursuant to
this chapter, including, but not limited to, arbitrations and
conciliations, are subject to Chapter 2 (commencing with Section
1115) of Division 9 of the Evidence Code.
SEC. 2. Section 1775.10 of the Code of Civil Procedure is amended
to read:
1775.10. All statements made by the parties during the mediation
shall be subject to Sections 703.5 and 1152, and Chapter 2
(commencing with Section 1115) of Division 9, of the Evidence Code.
SEC. 3. Chapter 2 (commencing with Section 1115) is added to
Division 9 of the Evidence Code, to read:
CHAPTER 2. MEDIATION
1115. For purposes of this chapter:
(a) "Mediation" means a process in which a neutral person or
persons facilitate communication between the disputants to assist
them in reaching a mutually acceptable agreement.
(b) "Mediator" means a neutral person who conducts a mediation.
"Mediator" includes any person designated by a mediator either to
assist in the mediation or to communicate with the participants in
preparation for a mediation.
(c) "Mediation consultation" means a communication between a
person and a mediator for the purpose of initiating, considering, or
reconvening a mediation or retaining the mediator.
1116. (a) Nothing in this chapter expands or limits a court's
authority to order participation in a dispute resolution proceeding.
Nothing in this chapter authorizes or affects the enforceability of
a contract clause in which parties agree to the use of mediation.
(b) Nothing in this chapter makes admissible evidence that is
inadmissible under Section 1152 or any other statute.
1117. (a) Except as provided in subdivision (b), this chapter
applies to a mediation as defined in Section 1115.
(b) This chapter does not apply to either of the following:
(1) A proceeding under Part 1 (commencing with Section 1800) of
Division 5 of the Family Code or Chapter 11 (commencing with Section
3160) of Part 2 of Division 8 of the Family Code.
(2) A settlement conference pursuant to Rule 222 of the California
Rules of Court.
1118. An oral agreement "in accordance with Section 1118" means
an oral agreement that satisfies all of the following conditions:
(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.
(d) The recording is reduced to writing and the writing is signed
by the parties within 72 hours after it is recorded.
1119. 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 or a
mediation consultation is admissible or subject to discovery, and
disclosure of the evidence shall not be compelled, in any
arbitration, administrative adjudication, civil action, or other
noncriminal proceeding in which, pursuant to law, testimony can be
compelled to be given.
(b) No writing, as defined in Section 250, 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 arbitration,
administrative adjudication, civil action, or other noncriminal
proceeding in which, pursuant to law, testimony can be compelled to
be given.
(c) All communications, negotiations, or settlement discussions by
and between participants in the course of a mediation or a mediation
consultation shall remain confidential.
1120. (a) Evidence otherwise admissible or subject to discovery
outside of a mediation or a mediation consultation shall not be or
become inadmissible or protected from disclosure solely by reason of
its introduction or use in a mediation or a mediation consultation.
(b) This chapter does not limit any of the following:
(1) The admissibility of an agreement to mediate a dispute.
(2) The effect of an agreement not to take a default or an
agreement to extend the time within which to act or refrain from
acting in a pending civil action.
(3) Disclosure of the mere fact that a mediator has served, is
serving, will serve, or was contacted about serving as a mediator in
a dispute.
1121. Neither a mediator nor anyone else may submit to a court or
other adjudicative body, and a court or other adjudicative body may
not consider, any report, assessment, evaluation, recommendation, or
finding of any kind by the mediator concerning a mediation conducted
by the mediator, other than a report that is mandated by court rule
or other law and that states only whether an agreement was reached,
unless all parties to the mediation expressly agree otherwise in
writing, or orally in accordance with Section 1118.
1122. (a) A communication or a writing, as defined in Section
250, 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 either of the following conditions 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.
(2) The communication, document, or writing was prepared by or on
behalf of fewer than all the mediation participants, those
participants expressly agree in writing, or orally in accordance with
Section 1118, to its disclosure, and the communication, document, or
writing does not disclose anything said or done or any admission
made in the course of the mediation.
(b) For purposes of subdivision (a), if the neutral person who
conducts a mediation expressly agrees to disclosure, that agreement
also binds any other person described in subdivision (b) of Section
1115.
1123. 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.
(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.
1124. 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.
(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.
1125. (a) For purposes of confidentiality under this chapter, a
mediation ends when any one of the following conditions is satisfied:
(1) The parties execute a written settlement agreement that fully
resolves the dispute.
(2) An oral agreement that fully resolves the dispute is reached
in accordance with Section 1118.
(3) The mediator provides the mediation participants with a
writing signed by the mediator that states that the mediation is
terminated, or words to that effect, which shall be consistent with
Section 1121.
(4) A party provides the mediator and the other mediation
participants with a writing stating that the mediation is terminated,
or words to that effect, which shall be consistent with Section
1121. In a mediation involving more than two parties, the mediation
may continue as to the remaining parties or be terminated in
accordance with this section.
(5) For 10 calendar days, there is no communication between the
mediator and any of the parties to the mediation relating to the
dispute. The mediator and the parties may shorten or extend this
time by agreement.
(b) For purposes of confidentiality under this chapter, if a
mediation partially resolves a dispute, mediation ends when either of
the following conditions is satisfied:
(1) The parties execute a written settlement agreement that
partially resolves the dispute.
(2) An oral agreement that partially resolves the dispute is
reached in accordance with Section 1118.
(c) This section does not preclude a party from ending a mediation
without reaching an agreement. This section does not otherwise
affect the extent to which a party may terminate a mediation.
1126. Anything 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.
1127. If a person subpoenas or otherwise seeks to compel a
mediator to testify or produce a writing, as defined in Section 250,
and the court or other adjudicative body determines that the
testimony or writing is inadmissible under this chapter, or protected
from disclosure under this chapter, the court or adjudicative body
making the determination shall award reasonable attorney's fees and
costs to the mediator against the person seeking the testimony or
writing.
1128. Any reference to a mediation during any subsequent trial is
an irregularity in the proceedings of the trial for the purposes of
Section 657 of the Code of Civil Procedure. Any reference to a
mediation during any other subsequent noncriminal proceeding is
grounds for vacating or modifying the decision in that proceeding, in
whole or in part, and granting a new or further hearing on all or
part of the issues, if the reference materially affected the
substantial rights of the party requesting relief.
SEC. 4. The heading of Chapter 2 (commencing with Section 1150) of
Division 9 of the Evidence Code is amended and renumbered to read:
CHAPTER 3. OTHER EVIDENCE AFFECTED OR EXCLUDED BY EXTRINSIC
POLICIES
SEC. 5. Section 1152.5 of the Evidence Code is repealed.
SEC. 6. Section 1152.6 of the Evidence Code is repealed.
SEC. 7. Section 66032 of the Government Code is amended to read:
66032. (a) Notwithstanding any provision of law to the contrary,
all time limits with respect to an action shall be tolled while the
mediator conducts the mediation, pursuant to this chapter.
(b) Mediations conducted by a mediator pursuant to this chapter
that involve less than a quorum of a legislative body or a state body
shall not be considered meetings of a legislative body pursuant to
the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of
Part 1 of Division 2 of Title 5), nor shall they be considered
meetings of a state body pursuant to the Bagley-Keene Open Meeting
Act (Article 9 (commencing with Section 11120) of Chapter 1 of Part 1
of Division 3 of Title 2).
(c) Any action taken regarding mediation conducted pursuant to
this chapter shall be taken in accordance with the provisions of
current law.
(d) Ninety days after the commencement of the mediation, and every
90 days thereafter, the action shall be reactivated unless the
parties to the action do either of the following:
(1) Arrive at a settlement and implement it in accordance with the
provisions of current law.
(2) Agree by written stipulation to extend the mediation for
another 90-day period.
(e) Section 703.5 and Chapter 2 (commencing with Section 1115) of
Division 9 of the Evidence Code apply to any mediation conducted
pursuant to this chapter.
SEC. 8. Section 66033 of the Government Code is amended to read:
66033. (a) At the end of the mediation, the mediator shall file a
report with the Office of Permit Assistance, consistent with Chapter
2 (commencing with Section 1115) of Division 9 of the Evidence Code,
containing each of the following:
(1) The title of the action.
(2) The names of the parties to the action.
(3) An estimate of the costs avoided, if any, because the parties
used mediation instead of litigation to resolve their dispute.
(b) The sole purpose of the report required by this section is the
collection of information needed by the office to prepare its report
to the Legislature pursuant to Section 66036.
SEC. 9. Section 10089.80 of the Insurance Code is amended to read:
10089.80. (a) The representatives of the insurer shall know the
facts of the case and be familiar with the allegations of the
complainant. The insurer or the insurer's representative shall
produce at the settlement conference a copy of the policy and all
documents from the claims file relevant to the degree of loss, value
of the claim, and the fact or extent of damage.
The insured shall produce, to the extent available, all documents
relevant to the degree of loss, value of the claim, and the fact or
extent of damage.
The mediator may also order production of other documents that the
mediator determines to be relevant to the issues under mediation.
If a party declines to comply with that order, the mediator may
appeal to the commissioner for a determination of whether the
documents requested should be produced. The commissioner shall make
a determination within 21 days. However, the party ordered to
produce the documents shall not be required to produce while the
issue is before the commissioner in this 21-day period. If the
ruling is in favor of production, any insurer that is subject to an
order to participate in mediation issued under subdivision (a) of
Section 10089.75 shall comply with the order to produce. Insureds,
and those insurers that are not subject to an order to participate in
mediation, shall produce the documents or decline to participate
further in the mediation after a ruling by the commissioner requiring
the production of those other documents. Declination of mediation
by the insurer under this section may be considered by the
commissioner in exercising authority under subdivision (a) of Section
10089.75.
The mediator shall have the authority to protect from disclosure
information that the mediator determines to be privileged, including,
but not limited to, information protected by the attorney-client or
work-product privileges, or to be otherwise confidential.
(b) The mediator shall determine prior to the mediation conference
whether the insured will be represented by counsel at the mediation.
The mediator shall inform the insurer whether the insured will be
represented by counsel at the mediation conference. If the insured
is represented by counsel at the mediation conference, the insurer's
counsel may be present. If the insured is not represented by counsel
at the mediation conference, then no counsel may be present.
(c) Section 703.5 and Chapter 2 (commencing with Section 1115) of
Division 9 of the Evidence Code apply to a mediation conducted under
this chapter.
(d) The statements made by the parties, negotiations between the
parties, and documents produced at the mediation are confidential.
However, this confidentiality shall not restrict the access of the
department to documents or other information the department seeks in
order to evaluate the mediation program or to comply with reporting
requirements. This subdivision does not affect the discoverability
or admissibility of documents that are otherwise discoverable or
admissible.
SEC. 10. Section 10089.82 of the Insurance Code is amended to
read:
10089.82. (a) An insured may not be required to use the
department's mediation process. An insurer may not be required to
use the department's mediation process, except as provided in Section
10089.75.
(b) Neither the insurer nor the insured is required to accept an
agreement proposed during the mediation.
(c) If the parties agree to a settlement agreement, the insured
will have three business days to rescind the agreement.
Notwithstanding Chapter 2 (commencing with Section 1115) of Division
9 of the Evidence Code, if the insured rescinds the agreement, it may
not be admitted in evidence or disclosed unless the insured and all
other parties to the agreement expressly agree to its disclosure. If
the agreement is not rescinded by the insured, it is binding on the
insured and the insurer, and acts as a release of all specific claims
for damages known at the time of the mediation presented and agreed
upon in the mediation conference. If counsel for the insured is
present at the mediation conference and a settlement is agreed upon
that is signed by the insured's counsel, the agreement is immediately
binding on the insured and may not be rescinded.
(d) This section does not affect rights under existing law for
claims for damage that were undetected at the time of the settlement
conference.
(e) All settlements reached as a result of department-referred
mediation shall address only those issues raised for the purpose of
resolution. Settlements and any accompanying releases are not
effective to settle or resolve any claim not addressed by the
mediator for the purpose of resolution, nor any claim that the
insured may have related to the insurer's conduct in handling the
claim.
Referral to mediation or the pendency of a mediation under this
article is not a basis to prevent or stay the filing of civil
litigation arising in whole or in part out of the same facts. Any
applicable statute of limitations is tolled for the number of days
beginning from the referral to mediation until the date on which the
mediation is either completed or declined, or the date on which the
insured fails to appear for a scheduled mediation for the second
time, or, in the event that a settlement is completed, the expiration
of any applicable three business day cooling off period.
SEC. 11. Section 65 of the Labor Code is amended to read:
65. The department may investigate and mediate labor disputes
providing any bona fide party to this type of dispute requests
intervention by the department and the department may proffer its
services to both parties when work stoppage is threatened and neither
party requests intervention. In the interest of preventing labor
disputes the department shall endeavor to promote sound
union-employer relationships. The department may arbitrate or
arrange for the selection of boards of arbitration on such terms as
all of the bona fide parties to the dispute may agree upon. Any
decision or award arising out of an arbitration conducted pursuant to
this section is a public record. Section 703.5 and Chapter 2
(commencing with Section 1115) of Division 9 of the Evidence Code
apply to a mediation conducted by the California State Mediation and
Conciliation Service, and any person conducting the mediation. All
other records of the department relating to labor disputes are
confidential.
SEC. 12. Section 350 of the Welfare and Institutions Code is
amended to read:
350. (a) (1) The judge of the juvenile court shall control all
proceedings during the hearings with a view to the expeditious and
effective ascertainment of the jurisdictional facts and the
ascertainment of all information relative to the present condition
and future welfare of the person upon whose behalf the petition is
brought. Except where there is a contested issue of fact or law, the
proceedings shall be conducted in an informal nonadversary
atmosphere with a view to obtaining the maximum cooperation of the
minor upon whose behalf the petition is brought and all persons
interested in his or her welfare with any provisions that the court
may make for the disposition and care of the minor.
(2) Each juvenile court is encouraged to develop a dependency
mediation program to provide a problem-solving forum for all
interested persons to develop a plan in the best interests of the
child, emphasizing family preservation and strengthening. The
Legislature finds that mediation of these matters assists the court
in resolving conflict, and helps the court to intervene in a
constructive manner in those cases where court intervention is
necessary. Notwithstanding any other provision of law, no person,
except the mediator, who is required to report suspected child abuse
pursuant to the Child Abuse and Neglect Reporting Act (Article 2.5
(commencing with Section 11164) of Chapter 2 of Title 1 of Part 4 of
the Penal Code), shall be exempted from those requirements under
Chapter 2 (commencing with Section 1115) of Division 9 of the
Evidence Code because he or she agreed to participate in a dependency
mediation program established in the juvenile court.
If a dependency mediation program has been established in a
juvenile court, and if mediation is requested by any person who the
judge or referee deems to have a direct and legitimate interest in
the particular case, or on the court's own motion, the matter may be
set for confidential mediation to develop a plan in the best
interests of the child, utilizing resources within the family first
and within the community if required.
(b) The testimony of a minor may be taken in chambers and outside
the presence of the minor's parent or parents, if the minor's parent
or parents are represented by counsel, the counsel is present and any
of the following circumstances exist:
(1) The court determines that testimony in chambers is necessary
to ensure truthful testimony.
(2) The minor is likely to be intimidated by a formal courtroom
setting.
(3) The minor is afraid to testify in front of his or her parent
or parents.
After testimony in chambers, the parent or parents of the minor
may elect to have the court reporter read back the testimony or have
the testimony summarized by counsel for the parent or parents.
The testimony of a minor also may be taken in chambers and outside
the presence of the guardian or guardians of a minor under the
circumstances specified in this subdivision.
(c) At any hearing in which the probation department bears the
burden of proof, after the presentation of evidence on behalf of the
probation department and the minor has been closed, the court, on
motion of the minor, parent, or guardian, or on its own motion, shall
order whatever action the law requires of it if the court, upon
weighing all of the evidence then before it, finds that the burden of
proof has not been met. That action includes, but is not limited
to, the dismissal of the petition and release of the minor at a
jurisdictional hearing, the return of the minor at an out-of-home
review held prior to the permanency planning hearing, or the
termination of jurisdiction at an in-home review. If the motion is
not granted, the parent or guardian may offer evidence without first
having reserved that right.