Alfieri v. Solomon

365 P.3d 99, 358 Or. 383, 2015 Ore. LEXIS 894
Oregon Supreme Court·Decided December 10, 2015·No. CC 1203-02980; CA A152391; SC S062520·Published·Cited by 34 cases

Opinion

*385 BALMER, C. J.

The issue presented in this case is one of first impression: to what extent do the confidentiality provisions of Oregon’s mediation statutes, ORS 36.100 to 36.238, prevent a client from offering evidence of communications made by his attorney and others in a subsequent malpractice action against that attorney? The trial court granted defendant’s ORCP 21 E motion to strike certain allegations in plaintiffs complaint and then dismissed the complaint with prejudice under ORCP 21 A(8) for failure to state a claim. The Court of Appeals affirmed in part and reversed in part, holding that ORS 36.220 and ORS 36.222 barred some, but not all, of plaintiffs allegations, and that the trial court erred in dismissing the complaint with prejudice before a responsive pleading had been filed. Alfieri v. Solomon, 263 Or App 492, 329 P3d 26 (2014). We agree that ORS 36.220 and ORS 36.222 limit the subsequent disclosure of mediation settlement terms and certain communications that occur in the course of or in connection with mediation. We disagree, however, as to the scope of communications that are confidential under those statutes. We also disagree with the Court of Appeals as to whether the trial court erred in dismissing plaintiffs complaint with prejudice because no responsive pleading had been filed. For the reasons set out below, we affirm in part and reverse in part the decision of the Court of Appeals and remand to the circuit court for further proceedings.

I. BACKGROUND

We state the facts, accepting as true all well-pleaded allegations in the complaint and drawing all reasonable inferences in plaintiffs favor. Bailey v. Lewis Farm, Inc., 343 Or 276, 278, 171 P3d 336, 337 (2007). Plaintiff retained defendant, an attorney specializing in employment law, to pursue discrimination and retaliation claims against plaintiffs former employer. In the course of that representation, defendant filed administrative complaints with the Oregon Bureau of Labor and Industries and thereafter a civil action against the former employer for damages on plaintiffs behalf. After limited discovery, plaintiff, represented by defendant, and plaintiffs former employer entered into mediation under the terms and conditions set forth in *386 ORS 36.185 to 36.210. Before meeting with the mediator and plaintiffs former employer, defendant advised plaintiff about the potential value of his claims and the amount for which he might settle the lawsuit. Plaintiff and his former employer, along with their respective lawyers and the mediator, attended a joint mediation session and attempted to resolve the dispute. However, no resolution was reached. After the session ended, the mediator proposed a settlement package to the parties. In the weeks that followed, defendant provided advice to plaintiff about the proposed settlement. At defendant’s urging, plaintiff accepted the proposed terms and signed a settlement agreement with his former employer. One of the terms to which plaintiff agreed was that the settlement agreement would be confidential. After the parties signed the agreement, defendant continued to counsel plaintiff and provide legal advice regarding the settlement.

Some months after the mediation ended, plaintiff concluded that defendant’s legal representation had been deficient and negatively affected the outcome of his case. Plaintiff sued defendant for legal malpractice, alleging that defendant had been negligent and had breached his fiduciary duty to plaintiff through his work both on the underlying civil action and the mediation. Plaintiff asserted that had defendant properly and completely pleaded his claims and reasonably prepared for trial he would have received a favorable jury verdict and been awarded substantially more monetary relief than he obtained by settlement. To assert those claims, plaintiff pleaded facts that disclosed certain terms of the confidential settlement agreement and that pertained to communications made by various persons involved in the mediation process.

Specifically, plaintiffs allegations disclosed facts about the mediator’s settlement proposal to the parties, defendant’s conduct during the mediation, and private attorney-client discussions between plaintiff and defendant regarding the mediation. Those private attorney-client discussions — which occurred outside the mediation session and without the involvement of either the mediator or plaintiffs former employer — concerned the valuation and strength of plaintiffs claims, whether plaintiff was obligated to accept *387 the mediator’s proposal and sign the settlement agreement, and whether the agreement was enforceable. Although some of those discussions took place before or while the mediation was still in progress, others occurred when plaintiff signed the settlement agreement or thereafter.

Defendant responded by moving to strike many of the allegations in plaintiffs complaint, arguing that they contained material that was confidential and inadmissible under two provisions of Oregon’s mediation statute, ORS 36.220 and ORS 36.222. ORS 36.220 provides in part: “Mediation communications are confidential and may not be disclosed to any other person” and “parties to a mediation may agree that all or part of the terms of a mediation agreement are confidential.” ORS 36.220(l)(a), (2)(b). 1 To the extent that a mediation agreement or communication is confidential under ORS 36.220, it is “not admissible as evidence in any subsequent adjudicatory proceeding, and may not be disclosed by the parties or the mediator in any subsequent adjudicatory proceeding.” ORS 36.222(1).

The mediation statute contains definitional provisions that describe the scope of what falls within those confidentiality and admissibility restrictions. “Mediation” is defined as:

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Alfieri v. Solomon, 365 P.3d 99, 358 Or. 383, 2015 Ore. LEXIS 894 (Or. 2015).

365 P.3d 99 (Alfieri v. Solomon) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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