206 Cal. App. 4th 724
Cal. Ct. App.2012Background
- Plaintiffs sued Lucia and others for defamation and related torts; Lucia pursued parallel arbitration against Plaintiffs.
- The trial court determined Plaintiffs were compelled to arbitrate against Lucia, so Lucia was dismissed from the suit, leaving the San Diego case to proceed.
- Immediately prior to the arbitrator’s decision, the parties agreed to settle in a process described as “mediation with a binding arbitration component” ( Med/Arb ).
- Settlement terms provided that the case would go to a full-day mediation; if unresolved, the mediator could select a binding judgment between $100,000 and $5,000,000 to be entered as a San Diego Superior Court judgment.
- The settlement was memorialized in a Settlement Agreement with amendments clarifying the mediator would pick either plaintiffs’ demand or defendants’ offer; the parties signed within a week.
- The mediator ultimately awarded $5,000,000, and Plaintiffs petitioned to confirm, which the trial court enforced as a binding mediator judgment under CCP §664.6.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Mutual assent to binding mediation | Bowers argues there was mutual assent to binding mediation, not postmediation arbitration. | Lucia contends the agreement contemplated a later evidentiary arbitration, not binding mediation. | Substantial evidence supports mutual consent to binding mediation. |
| Certainty of term 'binding mediation' | The terms were sufficiently definite to enforce a binding mediator decision. | Binding mediation is inherently uncertain and not enforceable. | Terms were sufficiently definite; enforceable under Civil Code guidance. |
| Waiver of jury trial under binding mediation | Nonjudicial forum via binding mediation validly waives jury trial rights. | Section 631 precludes postdispute jury-trial waivers outside specified methods. | Waiver is permissible when the parties settle in a nonjudicial forum. |
| Proper enforcement mechanism | CCP §664.6 properly enforces settlements with the mediator’s binding award. | The award is a mediation award, not an arbitration award, and cannot be confirmed as such. | Enforcement under CCP §664.6 affirmed; the court did not need to treat the award as arbitration. |
Key Cases Cited
- Weddington Productions, Inc. v. Flick, 60 Cal.App.4th 793 (Cal. App. 1998) (mutual consent and contract formation principles for settlements)
- Lindsay v. Lewandowski, 139 Cal.App.4th 1618 (Cal. App. 2006) (uncertainty of binding mediation terms; arbitration vs mediation distinction)
- Madden v. Kaiser Foundation Hospitals, 17 Cal.3d 699 (Cal. 1976) (jury trial waivers and nonjudicial settlement alternatives)
- Grafton Partners v. Superior Court, 36 Cal.4th 944 (Cal. 2005) (distinguishes postdispute waivers in judicial vs nonjudicial forums)
- Patel v. Liebermensch, 45 Cal.4th 344 (Cal. 2008) (contract certainty standard and enforcement when terms are definite)
- Okun v. Morton, 203 Cal.App.3d 805 (Cal. App. 1988) (postagreement conduct as evidence of intent)