Gibson v. Bobroff

In Gibson v. Bobroff (1996) 49 Cal.App.4th 1202, the trial court ordered the parties to participate in arbitration and, when that was unsuccessful, ordered them to participate in mediation. (Gibson v. Bobroff, supra, 49 Cal.App.4th at p. 1204.) Under applicable rules in that case, the trial court did not have authority to order the parties to participate in both arbitration and mediation. (Gibson v. Bobroff, supra, 49 Cal.App.4th at pp. 1204-1205, fn. 2.) Gibson noted: "Section 1775.4 expressly prohibits mediation once the court has ordered the parties to attend a judicial arbitration hearing." (Ibid.) The unauthorized court-ordered mediation in Gibson could be considered as being not significantly different from the voluntary mediation that occurred in the instant case. (Cf. id. at pp. 1210-1211 (conc. opn. of Kline, P.J.) by not objecting to unauthorized court-ordered mediation, appellants effectively waived claim that mediation expenses could not be awarded as costs under section 1033.5, subdivision (c)(4).) Mediation was also unsuccessful and, following trial, the court awarded the prevailing party his costs, including his share of the mediation fees. (Id. at p. 1205.) On appeal, Gibson rejected the appellants' argument that the Legislature did not intend mediation expenses to be recoverable as section 1033.5 costs. (Gibson, supra, at p. 1207.) Gibson stated: "Had the Legislature intended to exclude mediation expenses from items allowable as costs, it would have been a simple matter to have listed them in section 1033.5, subdivision (b), as an item which could not be awarded." (Gibson, supra, at p. 1207.) Furthermore, Gibson noted that the Legislature has enacted disincentives to trials de novo after court-ordered arbitration or mediation has been unsuccessful. (Id. at p. 1208.) If the party requesting a trial de novo does not recover a more favorable result at trial, that party may be required to bear the entire cost of that arbitration or mediation. In creating that scheme, the Legislature presumably believed such cost awards would discourage trials. (Ibid.) Gibson stated: "This risk of added expense promotes the legislative scheme declared in section 1775, i.e., to reduce the judicial backlog and encourage the fair, efficient and cost-effective resolution of disputes. Like the related arbitration scheme, mediation is fundamental to the conduct of litigation as it encourages the parties to settle their disputes before trial and exposes parties who fail to agree to a reasonable settlement proposal to the risk of a discretionary court determination that they should pay their opponent's share of the failed mediation." (Gibson, supra, at pp. 1208-1209.) Gibson held: "When an unsuccessful mediation has been court-ordered, reasonably necessary expenses incident thereto may, in the sound discretion of the trial court, be awarded after trial to a prevailing party." (Gibson, supra, at p. 1209.) It concluded the trial court did not abuse its discretion by finding those mediation fees were reasonably necessary to the conduct of the litigation and awarding the prevailing party its costs of mediation. (Id. at pp. 1209-1210.) The appellate court held that a trial court has discretion to award such costs where the mediation is court-ordered. (Ibid.) The appellate court expressly noted that it had no cause to decide whether a party may recover costs for a voluntary as opposed to a court-ordered mediation. (Id. at p. 1209, fn. 7.) The County of Los Angeles Fire Department (LACOFD) made a generalized argument that mediation is "a well-accepted means of resolving (or attempting to resolve) disputes short of trial," and that "a determination that the cost of an outside mediator was not 'reasonably necessary' might inappropriately dissuade parties from choosing this very effective method that assists in conserving judicial resources." However, LACOFD failed to specify any reason that the mediation was reasonably necessary in this case. "Whether a cost is 'reasonably necessary to the conduct of the litigation' is a question of fact for the trial court, whose decision will be reviewed for abuse of discretion." (Gibson, supra, 49 Cal.App.4th at p. 1209.) The Court relied on California Code of Civil Procedure section 1033.5, subdivision (c)(4) to hold that an award of mediation expenses as costs was not an abuse of discretion. ( Gibson v. Bobroff, supra, 49 Cal.App.4th 1202, 1207-1210.) The court found that certain policy goals were furthered by such an award, and that the award of mediation expenses was reasonably necessary to the conduct of the litigation.