Proposed Legislation
THE 2012 LEGISLATIVE SESSION
Cassel related legislation: AB 2025 is designed to reverse the California Supreme Court decision in Cassel v Superior Court, 51 Cal 4th 113 (2011). In that decision, the Court continued its staunch support for the confidentiality provisions in Evidence Code 1115 et seq. This bill will now make communications between an attorney and a client that occurred during the course of a mediation admissible within the context of a malpractice suit relating to the mediation.
The bill is seriously flawed. CDRC is opposing the bill and will continue its opposition even if the bill is amended to allow the testimony of other mediation participants because we believe that there should be no additional exceptions to mediation confidentiality.
Foreign attorney representation: AB 1631 will eliminate the sunset in Code of Civil Procedure Section 1282.4(b). That section establishes a procedure by which attorneys admitted in states other than California can represent clients in California arbitrations. CDRC supports this bill and believes that there is no further need for the sunset.
Assembly Bills
In Cassel v Superior Court, 51 Cal 4th 113 (2011), the California Supreme Court held that Evidence Code Section 1119 prevented the admission of communications between an attorney and client made during a mediation in a subsequent malpractice suit filed by the client. The effect of this decision was that it became difficult, if not impossible, for a client to sue an attorney for malpractice allegedly committed during the course of a mediation.
This led the California Conference of Bar Associations to adopt a resolution which amended Evidence Code Section 1120 by adding these communications to the narrow and precise exceptions to confidentiality set forth therein. This bill incorporates that resolution. But the bill is seriously flawed because it transfers one inequity to another. Attorneys subject to mediation malpractice suits will not be able to defend themselves since Evidence Code 1120 will continue to prevent them from introducing mediation communications from other mediation participants into evidence nor will it allow those participants to testify relative to those communications. In addition, Evidence Code 703 renders a mediator incompetent to testify.
This inequity caused CDRC to oppose the bill. As a direct consequence of CDRC’s opposition as well as a series of opposition letters generated by CDRC, the bill’s author pulled the bill from the legislative agenda. We believe that he is considering amending the bill and so we are awaiting further developments.
In Birbrower Montalban Frank & Condon v Superior Court, 17 Cal 4th 119 (1998), the California Supreme Court held that the California Business & Professions Code barred out of state attorneys from representing California based clients in arbitrations in California. California thereupon became the only state that barred attorneys admitted only in other jurisdictions from appearing in arbitrations.
CDRC immediately moved to amend Code of Civil Procedure 1282.4 (the provision which allows parties to be represented by counsel of their choice in arbitrations) so that attorneys admitted in other jurisdictions, but not in California, could appear in California arbitrations provided that they filed an application with the State Bar.
The Legislature passed the bill but required that there be a two year sunset. That sunset has been renewed five times. In the twelve years since the first amendment was enacted, there have been no problems with out of state attorneys abusing the right to appear in California arbitrations. CDRC believes that the time has come for elimination of the sunset. It therefore co-sponsored the bill, which does precisely that.
On April 10, the Assembly Judiciary Committee unanimously approved the bill. On April 17, 2012, this bill unanimously passed in the Assembly.
During the 2011 session, Assemblymember Wieckowski introduced AB 506, which set forth certain requirements that a municipality needed to meet before it could file a bankruptcy petition. The bill initially provided for an ADR procedure that was designated as “mandatory mediation”.
Because of this provision (and a few others), CDRC declined to support the bill. Subsequently, Assemblymember Wieckowski’s staff worked with CDRC and the mandatory procedure was redesignated as “neutral evaluation”, and the “mediator” became a “neutral evaluator”. CDRC then supported the bill and it was passed by the Assembly. However, the Senate reinserted the phrase “mandatory mediation” and the bill was enacted in that form.
AB 1692 was introduced by Assemblymember Wieckowski in this year’s session and it is designed to again insert the phrase “neutral evaluation” into the statute. The bill describes the phrase as “a form of alternative dispute resolution that has elements of mediation though, unlike mediation, it may be mandatory mediation”. CDRC remains concerned by the use of the term “mandatory mediation”. It has proposed the following definition: “Neutral evaluation is an alternative dispute resolution process that can be imposed upon the parties and is a means whereby a neutral evaluator considers the arguments presented by the parties and offers a non-binding opinion meant to assist in the resolution of issue(s) in the dispute”.
The author accepted this amendment and CDRC agreed to support the bill.
AB 2522. This bill will amend Section 798.15 of the Civil Code. It provides that a rental agreement in a mobile home park may not be made contingent upon the homeowner agreeing to binding arbitration or waiving a right to trial by jury for a dispute between the homeowner and management. A homeowner may voluntarily agree to provisions in a rental agreement that impose binding arbitration or waive the right to trial by jury for a dispute between the homeowner and management provided that the rental agreement clearly states that the homeowner is not required to agree to binding arbitration or to waive the right to trial by jury for a dispute between the homeowner and management.
It is one of the principles of CDRC that arbitration agreements between consumers and vendors be voluntary, not mandatory. Consequently, CDRC is supporting the bill.
This bill amends Civil Code Section 798.21 which exempts mobile home parks from local rent control ordinances where the mobile home is not the primary residence of the homeowner. The bill requires the operator of the mobile home park to provide 90 days written notice of any proposed rent modifications based on lack of sole residency at the mobile home park and provides for mandatory arbitration if the homeowner disputes the determination of the mobile home park operator. CDRC is watching the bill.
This bill amends Civil Code Section 845. That statute currently provides that if an easement is owned by one or more persons or is attached to parcels with different ownership and there is a dispute over the cost of repair of the right of way, an aggrieved party has the right to apply to the court for the appointment of an independent arbitrator to proportion the liability of the various parties.
The arbitration award is non mandatory in that a party who objects to the award can request a judge to make the final determination. The amendment set forth in this bill allows for the appointment of the arbitrator only in cases where the amount in controversy exceeds the monetary jurisdiction of the Small Claims Court. If the monetary jurisdiction of the Small Claims Court, in which case the aggrieved party will have the option to request the appointment of an independent arbitrator.
CDRC is watching the bill.
Senate Bills
Judicial Council Proposals
In Haworth v Superior Court, 50 Cal 4th 372 (2010), the California Supreme Court held that a retired judge need not have to disclose that he was disciplined for harassing female employees ten years before he served as an arbitrator in a matter in which a female was the claimant.
In response to this decision, the Administrative Office of the Courts proposed a rule that would require an arbitrator to disclose all past public discipline by a professional licensing agency or entity. The proposal was opposed by the California Judges Association on the ground that the proposal went beyond disclosure requirements imposed upon California judges.
CDRC supported the proposal’s general concept but had some concerns about specific language in the proposal and therefore believed that the proposal needed to be amended. Among other things, it thought that there should be a time limit on the disclosure of the public discipline and that there needed to be some relevance between the nature of the discipline and the matter involved in the pending arbitration. The proposal was forwarded the Judicial Council for approval, but the Council tabled it at its meeting on February 21 after some members of the Council expressed concern that it had not been fully vetted.