Horner v. Carter

• Decision Date: 12 February 2013
• Docket Number: No. 34S02–1210–DR–582.,34S02–1210–DR–582.
• Citation: 981 N.E.2d 1210
• Parties: Dennis Jack HORNER, Appellant (Petitioner), v. Marcia (Horner) CARTER, Appellee (Respondent).
• Court: Indiana Supreme Court

981 N.E.2d 1210

Dennis Jack HORNER, Appellant (Petitioner),

v.Marcia (Horner) CARTER, Appellee (Respondent).

No. 34S02–1210–DR–582.

Supreme Court of Indiana.

Feb. 12, 2013.

David W. Stone IV, Stone Law Office & Legal Research, Anderson, IN, Attorney for Appellant.

Brent R. Dechert, Kokomo, IN, Attorney for Appellee.

Indiana State Bar Assoc., Alternative Dispute Resolution Section and Indiana Assoc. of Mediators, Andrea L. Ciobanu, Ciobanu Law P.C., Indianapolis, IN, Attorney for Amici Curiae.

On Transfer from the Indiana Court of Appeals, No. 34A02–1111–DR–1029

DICKSON, Chief Justice.

When the parties' marriage was dissolved in 2005, the trial court approved a settlement agreement reached by the parties following mediation. Appellant's App'x at 19. In 2011, the husband initiated the present proceeding, seeking in part “to modify the maintenance provision in the Settlement Agreement,” id. at 27, in order to terminate his liability for monthly housing payments to the wife after her remarriage. At the evidentiary hearing the trial court excluded from evidence the husband's testimony regarding statements he claimed to have made to the mediator during the mediation process, and thereafter denied the husband's request for modification of his monthly housing payment obligation. The Court of Appeals affirmed the denial of relief, but opined that the trial court's exclusion of the husband's testimony was in error, albeit harmless error. Horner v. Carter, 969 N.E.2d 111, 118 (Ind.Ct.App.2012). We granted transfer thereby vacating the Court of Appeals opinion, except for those portions that are summarily affirmed herein. Ind. Appellate Rule 58(A)(2).

1. Exclusion of Husband's Statements to Mediator During Mediation.

Indiana policy strongly favors the confidentiality of all matters that occur during mediation.

Alternative Dispute Resolution Rule 2.11 Confidentiality

Mediation shall be regarded as settlement negotiations as governed by Ind. Evidence Rule 408. For purposes of reference, Evid. R. 408 provides as follows:

Rule 408. Compromise and Offers to Compromise

Evidence of (1) furnishing or offering or promising to furnish, or (2) accepting or offering or promising to accept a valuable consideration in compromising or attempting to compromisea claim, which was disputed as to either validity or amount, is not admissible to prove liability for or invalidity of the claim or its amount. Evidence of conduct or statements made in compromise negotiations is likewise not admissible. This rule does not require exclusion when the evidence is offered for another purpose, such as proving bias or prejudice of a witness, negating a contention of undue delay, or proving an effort to obstruct a criminal investigation or prosecution. Compromise negotiations encompass alternative dispute resolution.

Mediation sessions shall be closed to all persons other than the parties of record, their legal representatives, and other invited persons.

Mediators shall not be subject to process requiring the disclosure of any matter discussed during the mediation, but rather, such matter shall be considered confidential and privileged in nature. The confidentiality requirement may not be waived by the parties, and an objection to the obtaining of testimony or physical evidence from mediation may be made by any party or by the mediators.

Ind. Alternative Dispute Resolution Rule 2.11.

In Vernon v. Acton, we held that the mediation confidentiality provisions of our ADR Rules “extend to and include oral settlement agreements undertaken or reached in mediation. Until reduced to writing and signed by the parties, mediation settlement agreements must be considered as compromise settlement negotiations....” 732 N.E.2d 805, 810 (Ind.2000). Evidence of conduct or statements made in compromise negotiations or mediation is not admissible except when offered for a purpose other than “to prove liability for or invalidity of the claim or its amount.” A.D.R. 2.11 (incorporating Evid. R. 408); see also Gast v. Hall, 858 N.E.2d 154, 161 (Ind.Ct.App.2006), trans. denied. The admissibility provided for mediation evidence “offered for another purpose” pertains to the use of such evidence only in collateral matters unrelated to the dispute that is the subject of the mediation. SeeA.D.R. 2.11 (incorporating Evid. R. 408).

During the hearing on the husband's petition to modify the mediated settlement agreement, the trial court refused to allow the husband to testify as to his statements to the mediator during the mediation session. The husband sought admission of this evidence to avoid liability under the agreed settlement on grounds that it reflected neither his intent, nor his oral agreement during the mediation.

The Court of Appeals concluded that the husband's statements during the mediation could be admitted as extrinsic evidence to aid in the construction of an ambiguous agreement. We disagree. Indiana judicial policy strongly urges the amicable resolution of disputes and thus embraces a robust policy of confidentiality of conduct and statements made during negotiation and mediation.¹ The benefits of compromise settlement agreements outweigh the risks that such policy may on occasion impede access to otherwise admissible evidence on an...