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Court of Appeal
Lawyers Not Liable for Bad Advice Connected to Mediation
Opinion Says It Doesn’t Matter That Client Was Counseled Two Days Before Alternate-Dispute-Resolution Session
By a MetNews Staff Writer
The Sixth District Court of Appeal has affirmed a summary judgment in favor of a law firm in an action brought by a man whose right leg was amputated below the knee as a result of an accident and who accepted a $2 million settlement which, he contends, is too low and that his consent was the product of faulty advice from his attorneys, with the justices saying that the result is unfair but that it is compelled by binding precedent.
Justice Cynthia C. Lie said in Thursday’s unpublished opinion that the settlement offer was accepted in connection with mediation and that the plaintiff, Richard Beach, is foreclosed from presenting evidence of what lawyers at the Monterey County firm of Rovella, Retterer, Rosenthal & Gilles, LLP told him because everything that’s said in that context is secret. It does not matter, she declared, that the advice was rendered two days before the mediation.
Lie pointed to Evidence Code §1119(c) which provides:
“All communications, negotiations, or settlement discussions by and between participants in the course of a mediation or a mediation consultation shall remain confidential.”
Supreme Court Decision
The jurist noted that the California Supreme Court, in its 2011 opinion in Cassel v. Superior Court, declared that the privilege extends to attorney-client communications which are “neither discoverable nor admissible—even for purposes of proving a claim of legal malpractice.”
Beach contends that his lawyers advised that if he accepted the $2 million offer, there would be a net recovery of at least $1 million which would mean $9,332.74 per month, tax free, for the rest of his life or for 10 years, whichever was longer—and, he asserts, it turned out that this is not so.
In her opinion affirming the judgment by Monterey Superior Court Judge Carrie Panetta, Lie commented:
Bound by Cassel
“We recognize the inequity of this result on the undisputed facts. But, following Cassel, we lack authority to substitute our judgment for the Legislature’s or to deviate from the governing statutes….We acknowledge the plight Beach describes, but we are bound by Cassel….And Cassel forecloses Beach’s claim of error.”
The advice had been rendered to Beach on Dec. 4, 2018, two days before the mediation. That, Lie wrote, does not render the mediation privilege inapplicable, explaining:
“We cannot reconcile Beach’s claim that he relied on the advice to accept the mediation settlement offer with his contention that the advice was unrelated to mediation. Counsel’s advice about the take-home value of potential settlement at a mediation two days later—advice on which the client relied in deciding to accept the mediation settlement offer—is materially related to the mediation.”
Policy Argument
In his reply brief, Beach maintained that it cannot be the law that a “fraudulent (or even negligent) misrepresentation” by a lawyer to a client can be protected, remarking:
“If this were the case, then any lawyer, who saw an easy way to amass a hefty contingency fee for little effort, could make any representation at all, even if he knew before making such a representation that it was false, and later shield himself or herself from liability be claiming it was pursuant to mediation.
“This turns the very purpose of the mediation privilege statute on its head and there could be no more obviously absurd result; viewing the instant case in its proper perspective, it is for the trier of fact to determine the absurdity of Respondent’s contention.”
Lie—whose position was that “Cassel controls our decision here”—did not respond to that argument.
The case is Beach v. Johnson, Rovella, Retterer, Rosenthal & Gilles, H051523.
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