The California State Bar Standing Committee on Professional Responsibility and Conduct has issued a proposed opinion attempting to draw the line between unethical misrepresentations during negotiations, and permissible “puffing.” Using this distinction, false statements about, as examples, the existence of favorable witnesses, or about the amount of a party’s earnings, or about policy limits, would all fall on the unethical side of the line, and would subject an attorney making them to potential discipline. On the other hand, false statements about a party’s “bottom line” of settlement authority, or about a party’s willingness to litigate or its plans to file bankruptcy, would be considered mere “puffing,” basically the kinds of lies that parties expect the other side to tell during negotiations, and that they should not rely on.
The distinction seems fairly easy to follow. Material misrepresentations of fact, that are intended to induce reliance, and that parties would reasonably rely upon, are impermissible. But a certain amount of bluffing about the parties’ tactics and strategies is still considered fair play.
The proposed opinion could cause potential dilemmas for mediators, if they are asked to participate in impermissible sorts of misrepresentation. An ethical mediator should not commit fraud, and should take some action if the mediator becomes aware that one party is making impermissible misrepresentations. That could include refusing to convey misrepresentations to the other side, or even withdrawal in some cases. Strict confidentiality protections might, however, allow mediators and attorneys to avoid discipline for violating these proposed ethical guidelines when settlement negotiations take place during mediation.
Comments are open until May 19, 2014.
(Thanks to Rande Sotomayor for bringing this issue to my attention.)
Fairly Legal Blogby Clare FowlerEvery field has its share of embarrassment. The pilot who has a drink before getting on the plane. The surgeon who mistook the left foot for...
By Clare FowlerI’ve just added two new blogs to the World Directory of ADR Blogs, my ongoing project to track and catalog ADR and negotiation blogs around the globe. Allow me to...
By Diane J. LevinIntroduction When parents divorce or separate, they encounter the difficult task of determining child support. Since the late 80’s, mediators have been asking divorcing couples to create parenting plans instead...
By Stephen Erickson
With the purchase of a Featured Membership, you will be shown on the front page of Mediate.com to web site visitors from your city and region (“state” if you are in the USA). You may appear in more than one city/region by purchasing additional locations.
