ADR Case Updates
Travelers Casualty and Surety v. Superior Court (Mediation Cannot Be Coercive), 02/26/05
In case you have not seen it, attached is the interesting and recent decision in Travelers Casualty and Surety v. Superior Court (Second Appellate District, Division Eight, No. B176030), filed February 15, 2005, where a settlement judge coerced the participants in violation of mediation principles. The underlying case involved the litigation against the Roman Catholic Diocese of Orange based upon alleged sexual abuse by priests. A settlement judge was appointed to mediate the claims with the Diocese's liability carriers. In an effort to prevent the carriers from declaring forfeiture of coverage in the event the Diocese settled with plaintiffs without the carriers' consent, the judge conducted a hearing and made findings as to the value of the case. The carriers successfully sought a petition for writ of mandate to vacate the valuation order. The Appellate Court noted that mediation is a voluntary process based upon self-determination by the parties. Therefore, a mediator cannot engage in coercive conduct, such as conducting a fact-finding hearing over objection that was detrimental to the insurer participants in the mediation, even where the mediator is given broad discretion in formulating a settlement process. The court's holding reiterates the overriding principle that the mediator's role is to facilitate a voluntary process that can never be coercive.
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