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MSC: Lawyer’s Remarks Before Mediation Are ‘Confidential Communications’

Posted on Wednesday, August 18, 2021

An attorney’s alleged defamatory statements to another lawyer while waiting for a court-ordered mediation conference to begin were confidential mediation communications, the Michigan Supreme Court has unanimously ruled.

In Tyler v Findling (Docket No. 162016), the Michigan Supreme Court scrutinized the mediation communications court rule, MCR 2.412. According to the justices, the term “mediation communications” is expansive and includes statements that occur “during the mediation process” in addition to statements “made for purposes of … preparing for … a mediation.”

Here, the conversation between the defendant, Royal Oak attorney David M. Findling, and Rochester lawyer Anna Wright “took place within the mediator’s designated ‘plaintiff’s room’ while parties to the mediation were waiting for the mediation session to start and were thus part of the ‘mediation process,’” the Michigan Supreme Court observed. As a result, the alleged defamatory statements that Findling made to Wright about the plaintiff, Troy attorney B.A. Tyler, were “confidential communications.”

According to the justices, there is no requirement in MCR 2.412 that “a mediation communication be uttered by any particular party or participant.” Instead, the court rule “simply explains to whom confidential mediation communications can be disclosed. All mediation communications made by participants are afforded confidentiality protections.”

The high court’s decision partially reversed the Michigan Court of Appeals ruling in the case. The appeals court found that Findling’s statements were excluded from the protections of the mediation court rules because the conversation he had with Wright “was not for the purposes of retaining a mediator, or for considering, initiating, continuing, adjourning, concluding, or reconvening a mediation.” (See the Speaker Law Blog for an analysis of the Court of Appeals opinion.)

Notably, the Michigan Supreme Court issued its decision without hearing any oral arguments in the case. In so doing, the justices reinstated two Oakland County Circuit Court orders: one granting Findling’s motion to strike the affidavit and motion in limine to preclude testimony, and one granting Findling’s motion for summary disposition.

Background

The case involved attorney Tyler and his representation of Samir Warda in a malpractice and conversion case against Fieger, Fieger, Kenney & Harrington, PC. Warda suffered a traumatic brain injury and had been deemed a protected person by the probate court. Warda’s sister was appointed as his conservator. When Warda’s sister breached her fiduciary duties, the probate court appointed Findling as the receiver for Warda’s estate. The co-defendant, Mekel Miller, was a member of the Findling Law Firm and acted as counsel for receiver Findling. Together, Miller and Findling attempted to marshal the assets of Warda’s estate. These assets included two personal injury protection (PIP) auto insurance claims brought on Warda’s behalf by attorney Anna Wright of Atnip & Associates, PLLC. Findling and Miller came in contact with Wright while serving as receiver and counsel to the receiver.

Miller was reportedly the first to interact with Wright. Miller testified at trial that while investigating Warda’s suit against the Fieger Law Firm, she spoke with attorney Stephanie Arndt. Miller testified that, during the conversation, she shared that Tyler had seemingly been hostile to Findling and that Arndt responded that Tyler was similarly hostile toward Fieger. Arndt reportedly suggested to Miller there may have been a personal connection between Tyler and Warda. Miller testified that while she could not recall her conversation with Arndt verbatim, she was left with the impression that Warda had a criminal history, Tyler was hostile and aggressive and there was a question of whether Tyler had a personal relationship with Warda. Miller testified that, when she inquired further into whether there was a published criminal history or disciplinary action involving Tyler, she found nothing. It was from this information base that Findling spoke to Wright before a mediation conference and allegedly uttered a defamatory statement about Tyler. Wright recorded that conversation without Findling’s knowledge and then shared it with Tyler.

When Tyler learned of the alleged defamatory statements made by Findling, he filed this civil defamation lawsuit against Findling and his law firm in the Oakland County Circuit Court. For purposes of the complaint, Tyler did not specify the substance of the alleged defamatory remarks. Findling then filed motions in limine and motions to strike the communications, asserting mediation confidentiality, among other things. The Oakland County trial court granted Findling’s motion, finding the statements were confidential and privileged under MCR 2.412.

Findling subsequently filed a motion for summary disposition, arguing that under MCR 2.116(C)(10) once the trial court struck Wright’s recording and excluded her testimony, there was no material question of fact regarding defamation or any other cause of action. In response, Tyler filed a motion to amend his complaint and asserted additional defamatory communications made to another attorney at Atnip & Associates, PLLC. The Oakland County trial court granted summary disposition to Findling under MCR 2.116(C)(8), finding the proposed amendment failed to plead the content of the defamatory communication with specificity.

Tyler appealed. The Court of Appeals reversed the trial court, finding that the order granting the motion to strike Wright’s affidavit had to be vacated. The appeals court also held the trial court erroneously granted summary disposition to Findling under MCR 2.116(C)(10). Findling filed a motion for reconsideration, which was denied.

Findling appealed to the Michigan Supreme Court. The State Bar of Michigan Alternative Dispute Resolution Section filed an amicus brief in the case.

Confidential Communications

The Michigan Supreme Court ruled that Findling’s alleged defamatory statements to Wright prior to a mediation conference were “mediation communications” under MCR 2.412(B)(2) and confidential under MCR 2.412(C).

In reaching this conclusion, the justices emphasized that the term “mediation communications” is defined broadly and includes statements that occur not only during the mediation process but also “for purposes of … preparing for … mediation.” Here, the conversation between Findling and Wright took place while the parties were waiting for the mediation conference to begin and, as a result, they were part of the mediation process.

“Even if we were to agree with the Court of Appeals’ restrictive reading of MCR 2.411 as to when the ‘mediation process’ begins,” the Michigan Supreme Court said, “there’s no dispute that Findling’s statements to Wright were made while ‘preparing for’ the mediation session and are therefore expressly encompassed within the definition of ‘mediation communications.’”

In addition, the high court did not accept Tyler’s assertion that the alleged defamatory statements were irrelevant to the mediation of Warda’s case. “[T]he conversation between Findling and Wright concerned Warda’s credibility, which could have affected the decision to settle the PIP case or go to trial,” the justices observed.

The Michigan Supreme Court further rejected the Court of Appeals’ reading of the mediation court rules “as requiring a mediator to meet with the parties and attorneys before the definition of ‘mediation communications’ under MCR 2.412(B)(2) and the mediation confidentiality provision set forth in MCR 2.412(C) both attach.”

Moreover, the justices rejected the Court of Appeals’ conclusion that the expectation of confidentiality belongs to the mediation parties. “The plain language of the court rule contains no such limitation. … MCR 2.412(C) provides that mediation communications are, generally, (1) confidential, (2) neither discoverable nor admissible in a proceeding, and (3) not to be disclosed to anyone but the ‘mediation participants.’ The confidentiality protections cover ‘[m]ediation communications,’ MCR 2.412(C), which are not limited to communications made by a ‘mediation party’ but extend to, among other things, any statement ‘made for purposes of … participating in … a mediation.’ MCR 2.412(B)(2). This clearly encompasses statements made by a ‘mediation participant.’ Put differently, and contrary to the Court of Appeals’ analysis, there is no requirement in MCR 2.412 that a ‘mediation communication’ be uttered by any particular party or participant. Rather, the rule simply explains to whom confidential mediation communications can be disclosed. All mediation communications made by participants are afforded confidentiality protections.”

Here, Findling was a mediation participant as that term is defined in MCR 2.412(B)(4), the Michigan Supreme Court said. “Findling was acting as the court-appointed receiver with settlement authority for Warda, the party to the PIP action that was the subject of the mediation.”

Based on the foregoing, “the Court of Appeals erred by vacating the trial court’s grant of defendants’ motion to strike and reversing and remanding the trial court’s grant of defendants’ motion for summary disposition under MCR 2.116(C)(10),” the Michigan Supreme Court held. “[W]e reverse Part II(A)(2) of the [Court of Appeals] opinion and reinstate the Oakland Circuit Court’s October 31, 2018, order granting [Findling’s] motion to strike the affidavit and motion in limine to preclude testimony. We also reverse Part II(B)(2) of the Court of Appeals’ opinion and reinstate the circuit court’s March 8, 2019, order granting summary disposition to [Findling] under MCR 2.116(C)(10), because [Tyler] has admitted that, without Wright’s affidavit or testimony, he has no evidence to support the relevant defamation allegations. In all other respects, the application for leave to appeal is denied, because we are not persuaded that the remaining questions presented should be reviewed by this Court.”

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