By Steven G. MehtaSteve Mehta

It is fascinating that when I experience a particular event at a mediation, every so often I happen to come across information on  the web that is directly relevant to the event that happened that day.  Today for example, I mediated a case where one party accused the other of acting in bad faith and coming to the mediation in bad faith.

It just so happens that on the same day, I saw this post at http://www.karlbayer.com where there was a reference to a proposed Texas law regarding bad faith mediation.  That post discusses the new law regarding bad faith mediation tactics.  That law addresses three things as bad faith:  failure to participate, failure to have a full authority representative present, and failing to provide necessary information.  It authorizes the mediator to report this conduct.

Interestingly, I do  not think a statute like this would pass muster in California due to the limitations that the courts have imposed on the mediator’s ability to disclose information from the mediation.  But even if this limitation were removed by statute (as an exception to confidentiality), is it reasonable to ask the mediator to disclose this bad faith action?  Isn’t the mediator going to lose all credibility with one side or the other for reporting potential conduct?  Moreover, aren’t many cases subject to interpretation.  For example, what if a person has authority to settle from an insurance company but is limited by the authority given to him or her by the round table committee?  Is that full authority or is that failure to provide a proper person?  Is a client’s obstinate refusal to see the lack of merits in its position a failure to participate  in the process?  And what is necessary information?  Does the party have to disclose all information?  All relevant information?  All unfavorable information?  What if the party knows of a case or a theory that would destroy its position, but the other side doesn’t?

The issue of bad faith is very complex and in my humble opinion cannot be defined as easily as the Texas Legistlators seem to suggest

The problem with the issue of bad faith is that many litigators feel that the other side is acting in bad faith when they themselves may have acted in fashion that could be accused of being in bad faith.  Much of this comes from the frustration that occurs when the other side does not quickly accede to one side’s position or dollar value.  Much of the frustration (and comments regarding bad faith) comes from the fact that one side does not understand why the other side does a particular thing.  I have seen people accuse others of acting in bad faith because the other side would not agree with their dollar position;  I have also seen one side accuse another of acting in bad faith because it is not responding quickly enough.

The reality is mediation is not that simple.  You have two or more completely adverse parties who have been unable to solve their problems by themselves who are attempting to use the mediation process as another arena to advocate their positions.  The parties often don’t want to hear what the other side says, and I frequently hear that one side doesn’t care what the other side thinks or feels about a particular issue because the other side is simply wrong.  All of this goes in the mediation pot along with a dash of frustration regarding the litigation process.  Out of those raw ingredients, there is room for peace and resolution.  But the chance of resolution is probably decreased with accusations of bad faith.  Things don’t happen at the exact pace that we want it to happen.

We should be very careful about claiming bad faith, and should be even more careful in legistlating bad faith in mediation.

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