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When There Is No Middle Ground Possible

October 16, 2013

It is rare that I write about cases where mediation is not necessarily the most propitious dispute resolution process, but I do so today because I was reminded of the subject yesterday by an interesting, newly published case I read.

That case, in which both sides sought declaratory relief and a judicial determination of the enforceability of a building restriction contained in a deed, involved purely legal issues as opposed to factual issues (or both).

Also, in the case, the underlying high stakes question was whether the plaintiffs would be permitted to build on the land they bought, or not.

These factors combined to produce a dispute that maybe could not have been mediated to settlement at all, or mediated to resolution unless the neighbor-defendants agreed to accept money to allow the plaintiffs to build.

Yet, if the neighbors were adamant that the plaintiffs could not build at all, as set forth in the language of the deed, there could be no middle ground and a judicial determination as to that legal question would have been required, as it apparently was.

In most cases, there are both factual questions and legal questions.  Factual questions often produce various shades of gray (read as “ambiguity”) due to the uncertainty of how well the case may sit with the trier of fact (the jury in a jury case or the judge in a bench trial).

By contrast, purely legal questions in which reasonable legal minds can differ, may require judicial interpretation of rules of law, statutes or cases, especially if the stakes are high.  This does not always produce gray, but black or white in the outcome.

Thus, sometimes the outcome, as in the case I will describe, can be all or nothing at all for the litigants based upon how the law will be interpreted.

Consequently, legal questions solely in the province of a judge are not always easily resolvable, if at all, in mediation.

Many times they require someone in a black robe to decide the case because there is no middle ground to be had.

Yesterday, all of this came to mind again when I read an interesting, newly published case which ultimately involved whether or not the plaintiffs could build on the land they bought.

The case is Self v. Sharafi, 2013 S.O.S. D061181, filed September 20, 2013, publication ordered October 11, 2013, Cal. Court of Appeal, Fourth District, Div. One.

Here’s what happened:

In 1946, an owner of land conveyed away a portion of the land and retained a portion.

In the 1946 conveyance deed, the owner/seller stated: “A consideration of this sale is that no buildings will be erected now or at any future date on the [property retained].”

After many years, the Selfs acquired the “retained portion” and the Sharafis acquired the other portion.

The Selfs brought a lawsuit against the Sharafis to declare the building restriction unenforceable.

If unenforceable, the plaintiffs could build; if enforceable, they could not.  Thus the outcome was to be black or white, all or nothing at all, in a fairly high stakes contest.

The trial court found that the restriction was NOT enforceable and granted summary judgment in favor of the Selfs.  The Sharafis appealed.

For the reasons stated in the opinion, the appellate court disagreed with the trial judge, reversed the decision, and directed that judgment be entered in favor of the Sharafis, finding that the restriction WAS an enforceable covenant running with the land, burdening the parcel that the Selfs purchased and benefitting the parcel that the Shararis purchased.

(Purely as an interesting aside, the appellate opinion pointed out that the Selfs were aware of the building restriction prior to purchasing the land – it was disclosed in advance in the sellers’ Real Estate Transfer Disclosure Statement – yet the Selfs gambled and went ahead and purchased the parcel anyway. )

In such as case as this, there were undoubtedly opportunities for mediation both prior to trial in the Superior Court and later at the Court of Appeal.

The opinion of course does not talk about mediation, but it is obvious that the case did not settle … because it went to judgment and appeal.

As stated above, one way in which the case might have settled (this is pure speculation) would have been if the Sharafis agreed to accept a certain sum to allow the Selfs to build.

But if the Sharafis maintained the stance that there could be no building on the Selfs land whatsoever, because of the language of the deed, then the parties would have been left, as they were, with an all or nothing at all outcome, with no middle ground possible, and mediation probably could not have settled the dispute.

I have seen cases, particularly at the Court of Appeal where I sometimes mediate, where the resolution of a legal question is of paramount importance to one side or the other or both.

Experienced practitioners will agree that, in those rare instances, mediation is not always the right dispute resolution process.

***

David I. Karp is a full time mediator of real estate and business disputes in Southern California and has assisted various adjudicatory bodies in mediation, including presently the California Court of Appeal, Second Appellate District.  His website is at http://karpmediation.com . He apologizes for any ads affixed to this post by wordpress.com; they are not his.

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From → Law, Mediation

One Comment
  1. Often mediation does work and opens doors, however the courts are there to make decisions and this appears to be realty in this case

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