‘Good Faith Participation’ in Mediation – Where is the Yardstick?
By Joseph H. Paulk
One of the most slippery phrases in all of law is “good faith.” Are there two words in the English language more subject to individual expectations? Yet, courts in Oklahoma and throughout the United States are ordering parties to participate “in good faith” in mediation, without any objective standard or measurement of exactly what those two words mean.
It’s fairly easy to define what “good faith” doesn’t mean in a mediation setting: 1) “Good faith” doesn’t mean everyone must agree within the first hour; 2) “Good faith” doesn’t mean both sides have to use the same negotiating techniques or movements; and 3) “Good faith” doesn’t mean everyone has to resolve all their differences in one day, and with a smile. Those are obviously not the intent of “good faith participation.” To date there are no clear, written standards for defining “good or bad faith” participation in mediation. Yet, for many years, “good faith participation” has been a requirement for the entire litigation process, whether in federal district court proceedings1 or in Oklahoma district courts.
There are many other areas of the law, however, where we often see the phrase “good/bad faith” as a crucial linchpin in the prosecution/defense of a case. Some of these areas are: collective bargaining, contract law, insurance disputes and discovery disputes. The parties involved in these aspects of litigation expect an exhaustive review and examination of their conduct and actions, and there is ample case law to govern these situations.
The crucial difference between those areas of law and mediation is the true hallmark of the mediation process — confidentiality. No one participating in a mediation wants or expects their conversations or negotiating style to be subject to the scrutiny or examination of outside parties. They expect and deserve complete confidentiality. The Oklahoma Legislature has adopted the Dispute Resolution Act,2 District Court Mediation Act3 and the Choice in Mediation Act4 — all of which spell out a clear and undeniable intent concerning the importance of confidentiality. There is immunity from discovery from any source during the mediation process (unless a party to the mediation brings an action against a mediator, and then only the party that brings the action waives the confidentiality privilege).5 Information disclosed during mediation also has an additional layer of protection and is more than likely covered by the work product privilege. There is complete agreement that the mediation process increases judicial efficiency and docket control by promoting productive bargaining in an informal, confidential setting.
The problem comes when attorneys and their clients want their mediation to be confidential, but then want to sanction their opponents if they feel they are being unreasonable in their negotiations based upon their own analysis of the case. Simply requesting the court to sanction parties to mediations based upon perceived bad behavior does not provide the participants guidelines as to what is appropriate, competitive, negotiation conduct. The problem inherent in branding a negotiating approach as bad faith is that it will frustrate the positive purposes of the court ordered/encouraged mediation. How can there be a court review of actions alleged to be inconsistent with “good faith participation” without an opportunity to explain the rationale for the negotiation conduct? How do you explain mediation conduct in context, if the explanation involves disclosure of strategy and work product which are specifically prohibited from discovery? “Bad faith” cannot be established simply from the unsubstantiated allegations of an unhappy adverse party. We are relying on an individual trial judge to examine a party’s negotiation style, case evaluation and conduct in a confidential setting, and then associate the conduct to these terms without any stringent guidelines.
The courts and Legislature are clear that participants must engage in the mediation process “in good faith” but also under a cloak of confidentiality. So where does that leave us both as attorneys and judges? The participants and counsel to mediations need and deserve guidelines from the courts as to what is expected of their participation in a court ordered process. The court’s guidelines should provide a clear and objective standard under which participants can still hold onto their expectation of confidentiality.
There can certainly be objective criteria established by the courts as to what amounts to “bad faith.” First and foremost, the courts that order parties to participate in the mediation process must establish an order that outlines the court’s expectations as to the conduct of the process and the parties. This order might include: 1) Personal attendance by ALL parties and their respective insurers who are fully authorized to settle the dispute (does that include telephone participation by the decision maker?); 2) Participation in meaningful discussions between the mediator, the parties and their counsel; 3) All parties and counsel remaining at the mediation until excused by the mediator; 4) Making no knowing misrepresentations or misleading statements to the other parties or mediator; 5) Not using the mediation process to pursue an illegal enterprise such as extortion, threats of violence against parties or attorneys or any other third party; 6) Restraint from filing any new motions until the conclusion of the mediation; and 7) Not using the mediation to serve a participant with process. This certainly isn’t an exhaustive list of expectations, but it could be a start.
It should be incumbent upon the courts to objectively define the parameters of “good faith participation” or “bad faith conduct/participation” and who would specifically be subject to sanctions, so there will be no surprises as to what is allowable and what crosses the line. We all deserve better than a court stating: “I’ll know it when I see it.”6
1. FRCP 16 and 28 U.S.C §1927
2. 12 O.S. §1801, et seq.
3. 12 O.S. §1821, et seq.
4. 12 O.S. §1831, et seq.
5. See Rules and Procedures for Dispute Resolution Act, Appendix C – Confidentiality of Proceedings
6. Jacobellis v. Ohio 378 US 184, Justice Stewart Potter concurring opinion
About The Author
Joseph H. Paulk is the president and founder of Dispute Resolution Consultants Inc. His legal career has encompassed more than 100 jury trials as lead counsel, and more than 3,000 mediations in 12 states. He received mediation training through Harvard University, Pepperdine University and the American Law Institute. He is a founding member of the OBA Dispute Resolution Section. He is a national speaker and author of numerous published articles on negotiation and mediation.