New Jersey Lawyer & Attorney : Stark & Stark Law Firm : New Jersey Law Blog

In probate court actions, the award of attorney fees to a contestant of a last will & testament, is within the discretion of the Court. Except in a "weak or meretricious" case, Courts will generally allow counsel fees to both sides.

 

However, when a case involves non-probate assets, such as life insurance policies and pension proceeds, attorneys fees will not be paid out of these assets as they pass by operation of contract and property law and are outside of the decedent's estate.

 

In the Matter of the Estate of John Oliva, Jr., Deceased, a case decided by the Superior Court of New Jersey, Appellate Division, on August 25, 2011, the attack was on assets resulting from the decedent's life insurance policy and pension. The Court found that there was no authority for finding that such assets were part of the probate estate available to satisfy an award of counsel fees. In addition, the Court found that there could only be an award of counsel fees against an executrix personally where there was a "gross abuse of trust and confidence".

 

In general, New Jersey Courts follow the "American Rule" which requires each party to pay their own attorneys fees. While there is an exception in probate matters, that exception is limited and only applies to matters involving assets that are part of the probate estate.

If you have questions regarding the above matter, feel free to contact me here in my firm’s Lawrenceville, New Jersey office to discuss this matter in more detail.  

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In a report published for its 2009 - 2010 term, the New Jersey Supreme Court Committee on Complementary Dispute Resolution came up with certain recommendations concerning changes in the New Jersey Civil Presumptive Mediation Program. The New Jersey Supreme Court adopted the Committee's recommendations and has amended Rules 1:40-6(b), 1:40-12(b)(2) and Rules Appendix XXVI. These amendments will take effect on September 1, 2011. The purpose of these Rule amendments are to streamline and improve certain areas of the mediation program and mediation process.

 

The amendments approved by the New Jersey Supreme Court deal with: 1) the ability of parties to select their own mediator; 2) continuing education requirements for mediators; 3) charging of retainers by mediators; and 4) the method for mediators to secure assistance from the Courts to collect unpaid fees.




 

Selection of Mediator
The New Jersey Court Rules have always allowed parties involved in litigation to select a mediator of their own choice. Prior to the recent Rule amendments, the Court Order for mediation named the mediator that would handle the mediation and the designation of that mediator was effective as of the date of the Order. The parties could replace the designated mediator with a mediator of their own choice. The amended Rule change is subtle in that it still allows the parties to choose their own mediator. However, under the new Rule, the designation of the Court appointed mediator does not become effective for a period of 14 days after the date of the Order. During those 14 days the parties may choose their own mediator. If the parties do not choose their own mediator within 14 days, the mediator designated by the Court will become effective.




 

Continuing Education

Continuing education has always been part of the mediation process. The amendment to R. 1:40-12(b)(2) provides that continuing mediator education shall now include instruction in ethical issues associated with the mediation process.



 

Retainers

The amendment to Appendix XXVI dealing with the compensation of mediators, now allows mediators on the Court's mediation roster to charge a retainer once the two free hours of mediation have been completed and provides that mediators can charge more than the allowed one hour for pre-mediation preparation if the parties are so advised and there is an appropriate written disclosure prior to the beginning of the initial mediation session.



 

Enforcement of Compensation of Mediators
Getting paid is obviously an important concern of mediators. The amendments to the mediation Rules also change the process as to how mediators will have access to the Court system to collect fees. Previous, mediators could apply to the Court for the issuance of an Order to Show Cause in the event that they were not paid for their services. This process will no longer be allowed. Instead of providing that the Court issue an order requiring the delinquent party to show cause why the mediator's fee has not been paid, the Rule amendment provides that mediators may bring an action in the Special Civil Part of the county where the underlying action was brought. While mediators will still have access to the Courts to help them get their fees paid, the manner of enforcement has changed.


 

Mediation in New Jersey is very successful but is a constantly evolving process. We can certainly expect new amendments to the Rules on a continuing basis.

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In the Matter of the Estate of BELVA PLAIN, Superior Court of New Jersey, Chancery Division, Probate Part, Essex County, Docket No. ESX-CP-0048-2011, decided on July 22, 2011, the question was raised as to whether a child of a decedent was precluded from challenging the Last Will and Testament of his mother by his execution of a settlement agreement eighteen years before her death.  In that settlement agreement, the son covenanted not to challenge his mother's documents after her death.
 

The son filed a complaint seeking to invalidate his mother's will on the basis that she lacked the testamentary capacity to make the will or that the will was the result of undue influence.  The family history of the parties was one of considerable animosity and extensive litigation. Prior to the mother's death, she found it necessary to seek multiple restraining orders against her son.  At one point, the restraints barred her son from entering the municipality where his mother lived.   In 1993, approximately eighteen years before the mother died, the son and mother executed a settlement agreement which globally resolved more than a dozen pending litigations and resulted in the vacation of all outstanding restraining orders. In the Agreement, the son agreed not to attempt to set aside or contest the mother's will, or make any claim against the mother's estate. The mother agreed to make annual payments to the son for his support which would continue for the rest of the son's life. The mother also agreed to fund the son's psychiatric care up to a set maximum amount per year. The mother agreed to create an inter vivos trust that would be funded upon her death in order to continue to fulfill the obligation to support the son under the Agreement. The son, as of the time of trial, had received in excess of five hundred thousand dollars under the terms of the Agreement. Further, since 1990 the mother had executed ten different wills, all purporting to disinherit the son; the last eight wills executed after the parties’ 1993 Agreement, including the March 21, 2007 Will, all referred to the mother's obligations to support her son as set forth in the Agreement.
 

The agreement also required the mother to make a total of four future visits with her son under the supervision of the son's psychiatrist; two pre-scheduled telephone calls to the son per year at times and intervals to be determined by the mother; to write the son two letters annually, whose timeliness, content and duration shall be totally within the discretion of the mother.  Other than the contact detailed above, the Agreement forbade the son from contacting, attempting to contact or communicate with the mother or any other member of the family without the prior written consent of the specific family member. 
 

To avoid enforcement of the very clear language in the 1993 Settlement Agreement prohibiting Will challenges of precisely the sort initiated by the son in this case, the son first argued that the Settlement Agreement was both procedurally and substantively unconscionable. The Court noted that our legislature has addressed the issue of unconscionability as it pertains to contracts. N.J.S.A. § 12A:2-302 states, "(1) If the court as a matter of law finds the contract or any clause of the contract to have been unconscionable at the time it was made the court may refuse to enforce the contract, or it may enforce the remainder of the contract without the unconscionable clause, or it may so limit the application of any unconscionable clause as to avoid any unconscionable result."  The common law doctrine of unconscionability has proven difficult to define and has been rarely invoked undoubtedly because, other than in exceptional cases, it has been largely viewed as grossly interfering with the freedom to contract.  There are very few cases from New Jersey courts examining and defining unconscionability.
 

The son' next claim was that he was at an economic disadvantage when dealing with his mother and that he was required to "take whatever was thrown his way."  It was an undisputed fact that the son was represented by counsel at the time of the 1993 Settlement Agreement and that the parties engaged in multiple negotiations over a period of time exceeding one year. It was also undisputed that there was a lengthy history of litigation between the parties.  In light of the rancorous history of litigation and personal conflict, and also in light of the substantial consideration provided to the son over the years, the Court found nothing troubling about the agreement, either procedurally or substantively, as a matter of law.
 

Lastly, the son argued that he was excused from performance of the contract, because the his mother materially breached the agreement by failing to write him two letters per year as was required by the Settlement Agreement.  The Court noted that in contract law, a ‘material’ breach of contract is a failure to perform the contract that strikes so deeply at the heart of the contract that it renders the agreement irreparably broken and defeats the purpose of making the contract in the first place.  If there is a material breach the other party can simply end the agreement and go to court to try to collect damages caused by the breach.  The Court determined that due to the fact that the mother had total discretion to determine the timing, content, and duration of these letters, and, although there were questions as to just how therapeutic these letters could reasonably be expected to be, or how material they were to the overall agreement, the son's continuing to accept the other benefits of the Agreement in light of this alleged breach led to the conclusion that the son waived his right to use the breach as a defense to nonperformance.
 

The Court also found that the son's claims were also barred by the equitable doctrine of laches in view of his failure to timely act.   While the son claimed that his mother violated the Agreement shortly after it was executed by failing to send him two letters per year, he did not act on this knowledge, choosing instead to sit on his rights until he brought a will contest prohibited by the express terms of the Agreement. The Court found that a period of close to eighteen years without any assertion of his rights under the Agreement constitutes inexcusable delay and that the son was barred by laches.
 

Similarly, the doctrine of equitable estoppel barred the son's challenge to the contract. Equitable estoppel prevents one from rectifying his own grossly negligent mistake at the expense of another who has, without negligence, been misled.  The Court found that the son conducted himself in such a way as to lead all parties to believe the contract was still in force and to allow the son to assert the existence of a material breach negating his own obligations under the contract after all of these years would amount to fraud by conduct and would violate the Court’s equitable responsibilities.
 

The contract signed between the son and mother was deemed to be enforceable and the son was barred from making any claims concerning his mother's will.

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In a recent case decided by the Appellate Division of the Superior Court of New Jersey on June 17, 2011 (In The Matter of the Estate of Blanche T. Riordan, Deceased, Docket  No. A-4123-09T4; Docket No. A-4464-09T4; Superior Court of New Jersey, Appellate Division), the Trial Court concluded that the decedent had testamentary capacity when she executed her will and that the will was not the product of undue influence. 
 

The Plaintiffs argued that the Trial Court's finding that the decedent possessed the requisite testamentary capacity to execute a will was not supported by sufficient, credible evidence and rather, "was so far wide of the mark and contrary to competent evidence in the record as to amount to a manifest denial of justice.” The Appellate Division found the findings of the Trial Court on the issues of testamentary capacity and undue influence, though not controlling, were entitled to great weight since the Trial Court had the opportunity of seeing and hearing the witnesses and forming an opinion as to the credibility of their testimony reasonably credible evidence as to offend the interests of justice.
 

As a general principle, New Jersey law requires only a very low degree of mental capacity to execute a will. The gauge of testamentary capacity has been stated to be whether the testator can comprehend the property he/she is about to dispose of; the natural objects of his/her bounty; the meaning of the business in which he/she is engaged; the relation of each of these factors to the others, and the distribution that is made by the will. Testamentary capacity is tested at the time of execution of the will.
 

In any attack upon the validity of a will, there is a legal presumption that the testator was of sound mind and competent when he executed the will. This presumption can only be overcome by clear and convincing evidence. The burden of establishing lack of
testamentary capacity falls upon the party who contests the will being offered for probate.
 

Evaluating the evidence in the aggregate, the Trial Court in this case concluded that Plaintiffs did not satisfy their heavy burden of proving, by clear and convincing evidence, that the decedent lacked testamentary capacity when she executed her will.  The Appellate Division was satisfied that there was sufficient competent and reasonably credible evidence in the record to support the Trial Court's findings.
 

Plaintiffs also contended that the Trial Court's factual findings and legal conclusions with respect to the issue of undue influence were unsupported by the credible evidence adduced at trial and warranted reversal.
 

What constitutes undue influence sufficient to invalidate a will is a question of law.  But whether a will was procured by undue influence is a question of fact for the court, as is the truth or credibility of evidence introduced on such issue and the weight to be given to the evidence.   A will which on its face appears to be validly executed, can be overturned if it is tainted by "undue influence."
 

Undue influence has been defined as a mental, moral, or physical exertion of a kind and quality that destroys the free will of the testator by preventing that person from following the dictates of his or her own mind as it relates to the disposition of assets. 
 

Two elements are required to raise a presumption of undue influence. First, there must be a "confidential relationship" between the testator and the beneficiary. Second, the presence of "additional 'suspicious' circumstances" in combination with such a confidential relationship must exist.  Such circumstances need only be slight.
 

Under normal circumstances, once a presumption of undue influence has been established and the burden of proof is shifted to the proponent of the will, the presumption may be overcome by a preponderance of the evidence.  If, however, the presumption arises from a professional conflict of interest on the part of an attorney, coupled with confidential relationships between a testator and the beneficiary as well as the attorney, the presumption must instead be rebutted by clear and convincing evidence.
 

Notwithstanding the confidential relationship that existed, the Trial Court found no evidence that anyone overpowered the will of the decedent.  The court concluded the defendants had met their burden to overcome the presumption of undue influence by a preponderance of the credible evidence.  The Appellate Court upheld these conclusions as to the claims of undue influence as well as the claims of lack of testamentary intent.
 

Even though the Plaintiff was not successful in proving lack of mental capacity or undue influence, the Trial Court still awarded the payment of counsel fees from the estate.   The Plaintiffs appealed the Trial Court's failure to award the full amount of their counsel fees and the Defendants appealed the award of any counsel fees to Plaintiffs. The Appellate Court rejected both challenges.
 

The decision to award attorneys' fees falls within the discretion of the Trial Judge and, accordingly, is reviewed under an abuse of discretion standard as long as the Trial Judge did not act under a misconception of the applicable law.
 

New Jersey has a strong public policy against the shifting of attorneys fees and costs.  Generally, everyone pays their own counsel fees.  This based upon what is known as the American Rule.  However, there is an exception to this American Rule in certain cases.  One of those exceptions is for payment of counsel fees from an estate in a will contest where probate is granted and it appears that there was reasonable cause for contesting the validity of the will.  Except in a weak or meretricious case, courts will normally allow counsel fees to both proponent and contestant in a will dispute.
 

The Appellate Court upheld the finding of the Trial Court that there was a reasonable basis for the Plaintiffs position even though that basis was not sufficient to set aside the will. Simply put, the Trial Court determined the challenge to the will was reasonable and that the award of some, although not all of the counsel fees, was appropriate.

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In the Matter of the Estate of Lillian L. Fischer, the Appellate Division of the Superior Court of New Jersey (Docket No. A-0091-10T2) determined that a failure to disclose information in a mediation did not require a settlement to be overturned. This case was recently decided on June 14, 2011. 

 

In the Fischer case, the parties entered into a settlement of a case as a result of a court sponsored mediation. Sometime thereafter, a disagreement arose concerning the disposition of certain assets that had not been disclosed during the mediation. 

 

One of the parties to the mediation was aware of certain assets (in this case certain securties) and this party declined to alert the mediator or the other side that these assets existed because "[n]obody asked her about it". The other side, which was unaware of these assets, alleged that there was bad faith due to the failure to disclose the existence of additional assets. 

 

The Trial Court determined that there was no duty to disclose the fact that there were additional assets noting that there was no "exchange of discovery" or "clear identification of each party's positions about these issues." Accordingly, the Trial Court found no basis for concluding that there was any bad faith or bad motive during the mediation process. An appeal of the Trial Court's decision was filed. 

 

The two issues that were considered on appeal were whether there was a breach of the covenant of implied good faith and fair dealing that is implied in every contract under New Jersey law and whether there was an intentional failure to make a disclosure to the detriment of the other side. 

 

The Appellate Division affirmed the decision of the Trial Court finding that courts will not rewrite or unduly expand settlement agreements in order to deem settled or waived things not legitimately encompassed. The Appellate Division found that the implied covenant of good faith and fair dealing does not require "either side in negotiations to reveal any and all information that might help the adversary and hurt his or her own client." On the issue of the claim of fraud, the Appellate Division found that no fiduciary relationship existed between the parties and the transaction was not fiduciary in nature. In fact, the Appellate Division found that the adversarial relationship placed each side on notice to conduct their own due diligence. In addition, both parties were represented by counsel and entered into the settlement knowingly, voluntarily, and with an equal opportunity to negotiate the terms. It was further noted that if one side failed to investigate the existence, or the potential value, of certain assets prior to entering into a settlement, it was not the fault of the party not making the disclosure.

 

Mediation is an excellent process. It resolves disputes quickly and usually saves all parties significant expense. However, parties to a mediation must be aware that it is the obligation of each party to perform their own due diligence or understand that their lack of information cannot be used as a basis to later undo a settlement.

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What happens when an individual hires an attorney to engage in estate planning but never signs a will?  Will the "probable intent" of that individual be carried out or will it be ignored because the will was never signed?  The simple answer is that a failure to sign a will can have disastrous results.

On December 29, 2010, in the case of "In The Matter Of The Trusts To Be Established In The Matter Of The Estate Of Margaret A. Flood, Deceased", the Appellate Division of the Superior Court of New Jersey found that probable intent could not be carried out if there was no signed will and an individual dies intestate.

In the Flood case, the decedent, who was a widow, had four children.  Two of her children were disabled and were receiving benefits from supplemental security income and Medicaid.  One was receiving benefits from the Division of Developmental Disabilities (DDD).  The decedent was concerned about protecting any inheritance that she might leave to her disabled children from any obligation they might have to reimburse the governmental entities that had provided them with services. 

The decedent died before she executed a will or testamentary trust.  The administrator of her estate went to Court to establish and fund the trusts that the decedent would have created had she not died before executing a will.  These trusts would have protected the inheritance for the children.  DDD opposed the relief sought.  At stake was $480,000.

The Trial Court held that the law would allow the decedent's intent to be carried out.  However, the Appellate Division reversed the Trial Court and found that the Court could not do what the decedent failed to do.  The Appellate Division found that while the doctrine of "probable intent" could be used to create a testamentary disposition when an individual had executed a will, it could not be used when a will was never executed.  The Appellate Division noted that the doctrine could not be used "...to write a will that the testator did not write".  The doctrine could be used to construe a will, but not to create a will. 

The simple lesson from this case is that if you want your intentions carried out, you better take care of completing your estate plan, and not just think about it.

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Lawsuits over the validity of a Last Will and Testament have become a common form of litigation around the country, as well as in the State of New Jersey.  Preparing an estate plan is something that is necessary and something that everyone should take care of while they are in an appropriate physical and mental state.   However, there are no rules as to when estate planning must be done.   Some individuals plan their estates well in advance.  Others wait until the last minute.  Some make sure that they frequently update their estate plans.  Others ignore what has to be done.  The result of late planning is often litigation.

In addition to the act of getting estate planning done, many other factors play into the fact that so many probate estates end up in litigation.  As families grow away from each other, natural suspicions arise.  Did someone influence the preparation of the Will?  Was the maker of the Will competent?  How were the assets divided?  How long was the marriage?  The questions are virtually endless.

In a recent case decided in the United States District Court for the District of New Jersey, the Federal District had to decide whether there was appropriate subject matter jurisdiction for the Federal District Court to hear probate matters.  In the matter of Berman v. Berman, 2009 WL 1617758 (D. N.J.) the case involved allegations of undue influence and lack of testamentary capacity to execute a Will, among other claims.   The plaintiff filed the case in the New Jersey State Court, Probate Division and the defendant removed the case to the Federal District Court.  The central issue for consideration was whether the Federal District Court could hear the dispute between the parties, which included probate issues.

The Federal District Judge noted that the United States Supreme Court had recognized a "probate exception" to otherwise proper federal jurisdiction.  Accordingly, when a case may otherwise qualify to be heard in Federal Court, the Federal Court would not have jurisdiction where the matter involved (1) the probate or annulment of a will; (2) administration of a decedent's estate; or (3) the assumption of jurisdiction of over property that was in the custody of the probate court.

Since the case in Berman involved questions of the validity of a Will, the Court determined that the "probate exception" applied and that the case had to be heard in the State Court.   The case was therefore remanded to the Superior Court of New Jersey, Chancery Division.

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Public policy supports the resolution of disputes before a lawsuit is filed.  What happens when a contract calls for mediation prior to filing suit as a condition of securing attorneys fees, if the party filing the suit suggests mediation after the lawsuit is filed?  Is the failure to seek mediation a bar to a recovery of attorneys fees or is the request for mediation made just after suit is filed deemed to be substantial compliance?
 

In the case of Lange v. Schilling, No. C055471, 2008 WL 2192833 (Cal. Ct. App. May 28, 2008), the Court of Appeals enforced a contract term that established a condition precedent that required a party to attempt to mediate a conflict before proceeding to arbitration or litigation in order to recover attorney fees.


In that case, the plaintiff bought property from a real estate broker, using a standard residential property purchase agreement. The agreement provided that the parties would mediate any dispute before resorting to arbitration or court action. Under the agreement, if a party commenced an action without first attempting to mediate, that party would not be entitled to recover any attorney fees which would otherwise be available. The Plaintiff sued the broker for alleged misrepresentations made about the property's condition. The Plaintiff then sent the broker a letter stating that he was willing to stay litigation in order to mediate the matter, but received no response. Thereafter, the trial court entered a judgment in favor of Plaintiff and finding the broker liable.


The Plaintiff, after succeeding in the lawsuit, filed a motion to recover attorney fees from the broker. In opposing the motion, the broker argued that the Plaintiff was not entitled to attorney fees because he did not attempt to mediate the dispute. The trial court determined that the plaintiff substantially complied by offering to stay the litigation in order to mediate and awarded the Plaintiff attorney fees. On appeal, the broker argued that the clear language of the agreement precluded an award of attorney fees if a party did not attempt mediation before commencing litigation. The Court agreed and found that since the Plaintiff filed his lawsuit prior to offering mediation, there was no basis to award fees.


The Court noted that while the agreement authorized attorney fees, that right was contingent on compliance with the mediation provision. The Plaintiff filed his lawsuit first and only later offered mediation. His failure to meet the condition precedent precluded any award of fees. The Court stated that the strong public policy in favor of mediation as an alternative to judicial proceedings is served by requiring the party commencing litigation to seek mediation as a condition precedent. Had the parties resorted to mediation, their dispute may have been resolved in a much less expensive and time-consuming manner. The plaintiff argued that his failure to seek mediation should be excused because he promptly offered to mediate, thereby complying with the spirit and intent of the language of the contract. The Court rejected this argument and noted that the plaintiff could have sent an offer for mediation before filing his complaint. The Court further determined that the doctrine of substantial compliance was not applicable because the contract imposed a clear and unambiguous condition.


Accordingly, the Court reversed the fee award.  The message set forth by the Court was simple and direct.  Public policy favors resolution of cases instead litigating them and the Court would therefore not allow the commonly used doctrine of substantial compliance to defeat that policy.

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The mediator privilege is extremely important to the mediation process.  Without it, participants would have no confidence in the process and information necessary to assist the mediator in resolving a case would not be communicated.   It has often been said that the mediation process involves two levels of confidentiality.  The first level is when the parties are together in a joint session.  While the communication itself at a joint session cannot be used at a later proceeding, the information conveyed has been heard by all and that cannot be changed.  However, communications at a separate session consisting of a party, counsel and the mediator are completely confidential, subject to the provisions noted below.

 
Effective July 1, 2008, New Jersey Evidence Rule 519 was amended.  This amended Rule deals with the "Mediator Privilege". 

 
Privileged communications
The amended Rule provides that a mediation communication is privileged and shall not be subject to discovery or admissible in evidence in a proceeding unless waived or precluded as provided by law.  In a mediation proceeding, the following privileges shall apply:

(1) a mediation party may refuse to disclose, and may prevent any other person from disclosing, a mediation communication.

(2) a mediator may refuse to disclose a mediation communication, and may prevent any other person from disclosing a mediation communication of the mediator.

(3) a nonparty participant may refuse to disclose, and may prevent any other person from disclosing, a mediation communication of the nonparty participant.

Evidence or information that is otherwise admissible or subject to discovery shall not become inadmissible or protected from discovery solely by reason of its disclosure or use in a mediation.  


Waiver of privilege
The privilege may be waived in a record or orally during a proceeding if it is expressly waived by all parties to the mediation and:

(1) in the case of the privilege of a mediator, it is expressly waived by the mediator;  

(2) in the case of the privilege of a nonparty participant, it is expressly waived by the nonparty participant;

(3) a person who discloses or makes a representation about a mediation communication that prejudices another person in a proceeding is precluded from asserting a privilege, but only to the extent necessary for the person prejudiced to respond to the representation or disclosure; and  

(4) a person who intentionally uses a mediation to plan, attempt to commit or commit a crime, or to conceal an ongoing crime or ongoing criminal activity is precluded from asserting a privilege.   

Lack of privilege
There is no privilege for a mediation communication that is:

(1) in an agreement evidenced by a record signed by all parties to the agreement;

(2) made during a session of a mediation that is open, or is required by law to be open, to the public;

(3) a threat or statement of a plan to inflict bodily injury or commit a crime;

(4) intentionally used to plan a crime, attempt to commit a crime, or to conceal an ongoing crime or ongoing criminal activity;

(5) sought or offered to prove or disprove a claim or complaint filed against a mediator arising out of a mediation;

(6) except as otherwise provided, sought or offered to prove or disprove a claim or complaint of professional misconduct or malpractice filed against a mediation party, nonparty participant, or representative of a party based on conduct occurring during a mediation;  

(7) sought or offered to prove or disprove child abuse or neglect in a proceeding in which the Division of Youth and Family Services in the Department of Human Services is a party, unless the Division of Youth and Family Services participates in the mediation.

(8) considered by a court, administrative agency, or arbitrator,  in certain limited proceedings involving a crime or to prove a claim to rescind or reform or a defense to avoid liability on a contract arising out of the mediation, and in which there is a finding, after a hearing in camera, that the party seeking discovery or the proponent of the evidence has shown that the evidence is not otherwise available, that there is a need for the evidence that substantially outweighs the interest in protecting confidentiality.   

Permitted disclosures
A mediator may not make a report, assessment, evaluation, recommendation, finding, or other oral or written communication regarding a mediation to a court, administrative agency, or other authority that may make a ruling on the dispute that is the subject of the mediation, except as is noted below. A communication made in violation of subsection a. may not be considered by a court, administrative agency, or arbitrator.


A mediator may disclose:

(1) whether the mediation occurred or has terminated, whether a settlement was reached, and attendance; or

(2) a mediation communication as permitted under other provisions as noted above.

Confidentiality is the key to a successful mediation.   Every mediator must be aware of its significance and make sure that all counsel and participants understand and appreciate its role in the mediation process.

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