Grubaugh v. Blomo – 9/23/2015

October 27, 2015

Arizona Court of Appeals Division One holds that a plaintiff does not impliedly waive the mediation process privilege by bringing a legal malpractice claim against a former attorney and that communications protected by the mediation process privilege cannot form the basis of a plaintiff’s claims.

This appeal arose out of the trial court’s conclusion that the mediation process privilege created by A.R.S. § 12-2238(B) had been waived.  The underlying action involved a legal malpractice claim by a client’s claim against her former divorce attorney.  The client’s claim focused on the distribution of certain business assets, which had been agreed upon during a family court mediation.  The attorney asked the trial court to order that the mediation process privilege was waived as a result of the malpractice claim and moved in the alternative that the allegations relating to the mediation be stricken from the complaint.  The trial court concluded that the mediation privileged was waived in part and inapplicable in part, and found the alternative argument to be moot.  The client then filed a special action and the Court of Appeals accepted jurisdiction.

The Court first addressed whether the mediation privilege was indeed waived and concluded that it was not.  The Court’s analysis turned on the plain language of § 12-2238(B), which provides that “[c]ommunications made, materials created for or used and acts occurring during mediation are confidential and may not be discovered” unless one of four exceptions applies:  (1) all parties to the mediation agree to the disclosure; (2) the communication, material or act is relevant to a claim or defense made by a party to the mediation against the mediator; (3) disclosure is required by statute; or (4) the disclosure is necessary to enforce an agreement to mediate.  The Court found that A.R.S. § 12-2238(B) “provides for a broad screen of protection that renders confidential all communications, including those between an attorney and her client, made as part of the mediation process,” and that none of the statutory exceptions excluded attorney-client communications. 

The Court noted that the mediation process privilege differs from the attorney-client privilege and found that the trial court had erred by drawing an analogy to cases where parties impliedly waived their attorney-client privilege.  Unlike the attorney-client privilege, which originated at common law, the Court found that the mediation process privilege was created entirely by the legislature and reasoned that it must therefore “rely upon the language of the statute” in analyzing issues involving the mediation process privilege.  The Court concluded that the plain language of the statute left “no room for an implied waiver under these circumstances” because the parties did not contend that any of the four exceptions listed in the statute were applicable.  Additionally, the Court noted that client was not the only holder of the privilege in this situation because her former husband was also a party to the mediation and the Court found that the “privilege must be enforced” to protect the rights of “the absent party.”

The Court then proceeded to address the attorney’s alternative argument – that claims involving mediation-related communications should be stricken from the complaint.  Relying on a case from the California Supreme Court, the Court held that the application of the “mediation process privilege, in this case, requires that allegations dependent upon privileged information be stricken from the complaint.”  “To hold otherwise,” the Court stated, “would allow a plaintiff to proceed with a claim largely upon the strength of confidential communications while denying the defendant the ability to fully discover and present evidence crucial to the defense of that claim.”  Because the legislature had not excluded attorney-client communications from the scope of the mediation process privilege and did not exclude an exemption for legal malpractice claims, the Court concluded that striking the mediation related claims was “the logical and necessary consequence of applying the plain language” of A.R.S. § 12-2238(B). 

Judge Gemmill authored the opinion of the Court; Judges Jones and Kessler joined.