Argued and Submitted September 5, 2013
Multnomah County Circuit Court 120302980. Jerry B. Hodson, Judge.
Mark M. McCulloch argued the cause for appellant. With him on the opening brief was Powers, McCulloch & Bennett, LLP. With him on the reply brief was Farleigh Wada Witt.
Thomas W. Brown argued the cause for respondent. With him on the brief was Cosgrave Vergeer Kester LLP.
Before Armstrong, Presiding Judge, and Nakamoto, Judge, and Egan, Judge.
[263 Or.App. 494] EGAN, J.
In this legal malpractice action arising out of the mediation of an underlying civil lawsuit, plaintiff appeals from a general judgment dismissing his claims against his former attorney, asserting that the trial court erred in granting defendant's ORCP 21 E motion to strike and in granting defendant's motion to dismiss with prejudice under ORCP 21 A(8) for failure to state a claim. Plaintiff contends that the trial court erred in striking the allegations that, during and just after the mediation, defendant's representation of plaintiff was negligent and that defendant breached his fiduciary duty to plaintiff. Plaintiff also asserts that the trial court erred in dismissing his complaint with prejudice under ORCP 21 A(8). We affirm in part and reverse in part the motion to strike, and we reverse and remand the judgment of dismissal with prejudice.
In reviewing a trial court's grant of a motion to strike under ORCP 21 E and grant of a motion to dismiss for failure to state a claim under ORCP 21 A, we employ the same standard: " We * * * accept as true all well-pleaded allegations and any facts that might be adduced as proof of those allegations." In re Marriage of Ross, 240 Or.App. 435, 439, 246 P.3d 1179 (2011). In light of that standard, we summarize the facts taken from plaintiff's complaint.
Plaintiff retained defendant, an employment law attorney, to pursue claims against plaintiff's former employer by filing complaints with the Bureau of Labor and Industries (BOLI), and, later, by filing a civil complaint on plaintiff's behalf. In that complaint, defendant initially alleged a common-law wrongful discharge claim against plaintiff's former employer, but subsequently filed a motion to amend the complaint to add additional claims. The trial court granted that motion. However, defendant did not amend the complaint. Defendant performed only limited discovery in the underlying lawsuit and then proposed mediation.
Before the mediation conference, defendant advised plaintiff regarding the potential value of settling the underlying [263 Or.App. 495] lawsuit. No resolution was reached at the mediation conference. The day after the mediation
conference, the mediator suggested a settlement package to the parties. Over the next 16 days, defendant continued to advise plaintiff regarding the proposed settlement package. During that time, defendant again advised plaintiff regarding the potential value of settling the underlying lawsuit, but significantly reduced the dollar value of his recommendation. Plaintiff ultimately signed a settlement agreement that incorporated the settlement amount proposed by the mediator. The parties agreed that the terms of the agreement and the settlement amount would remain confidential. After signing the agreement, plaintiff continued to seek advice from defendant regarding the enforceability of the agreement; during that period, defendant failed to advise plaintiff that the former employer had not complied with some of the agreement's terms, calling into question the enforceability of the agreement.
Plaintiff sued defendant for legal malpractice, alleging that defendant had been negligent and had breached his fiduciary duty to plaintiff. The allegations included communications by the mediator, the content of communications between plaintiff and defendant during the 16-day period after the mediation conference (the post-mediation conference period), the settlement amount and contents of the final settlement agreement, and the content of communications between plaintiff and defendant after plaintiff had signed the settlement agreement (the post-signing period).
Pursuant to ORCP 21 E, defendant moved to strike the portions of plaintiff's complaint relating to the mediation [263 Or.App. 496] and settlement agreement, contending that those challenged portions of the complaint were " mediation communications" that were both confidential and inadmissible under ORS 36.222(1). Defendant also filed an ORCP 21 A(8) motion to dismiss plaintiff's complaint for failure to state ultimate facts sufficient to constitute a claim, arguing that dismissal was required because plaintiff could not allege or prove his damages without the challenged portions of the complaint. After a hearing on the matter, the trial court granted defendant's motion to strike. The court then dismissed the complaint with prejudice. This appeal followed.
Because they inform the parties' arguments, we begin by setting forth the pertinent legal standards. Generally," [m]ediation communications are confidential and may not be disclosed to any other person" unless the parties otherwise agree, in writing. ORS 36.220(1)(a), (b). " Mediation ...