Author: Amy L. Miles
Florida’s Supreme Court amended Florida Rule of Civil Procedure 1.720, governing mediation procedures with the changes effective as of January 1 of this year. Substantively, the court added a definition of “party representative having full authority to settle” and a requirement that the party certify to the court the identity of that representative and that he or she actually have the required authority to settle before the mediation conference takes place.
It is clear from the committee notes on the amended rule that the purpose for the new definition is to create an “objective standard” by which the court, without input from a mediator who is bound by confidentiality requirements, can measure the authority of a party representative to settle the dispute. So, too, the certification is a “direct representation to the court” that can be verified “upon motion by a party or inquiry by the court without involvement of the mediator and would not require disclosure of confidential mediation communications.” We must not forget that rule 1.720 contains a sanctions provision for failure to appear at the mediation conference.
So, is the amendment a cure for something that is broken? Will there be more settlements coming out of court-ordered mediations as a result? Those we have spoken to are doubtful.
Let’s first look at the purpose for mediation. Mediation is a process that has been formally incorporated into the litigation system to facilitate dispute resolution. It was added with the idea that mediation will save parties time and money while enabling them to come to a mutually-acceptable resolution.
What element of involving the court further in the mediation process as an enforcer, not of the agreement but of the process itself, will decrease the cost and time spent? Cost and time will not be saved by additional motions filed by parties when, for instance, the individual certified to attend has a sudden emergency? Nor is cost and time saved by motions to dispense with mediation altogether because the only nationally-based corporate officer with the actual ability to authorize millions of dollars of settlement is unable to attend a court-ordered mediation over a local dispute with which he or she is unfamiliar. Similarly, cost and time will not be saved by post-mediation motions for sanctions—and the discovery or hearings they will generate—based on the perceived failure to attend the conference in strict compliance with the rule.
Courts have, for years, recognized the benefits of permitting persons to appear by telephone. Telephonic hearings permit the case to move along where individuals necessary for the hearing would otherwise be unable to attend due to location, time, or cost constraints. Although the new amendments don’t change the requirements that those authorized to settle the case appear personally, they do take it a step further from having the ability to confer with corporate superiors if necessary. This may ultimately increase the cost of mediation and decrease the possibility of settlement—or at least slow the process down—as often local representatives familiar with the case will not have the authority to settle without the need to seek further approval and those who must attend are fewer in number, possibly much further away and without intimate knowledge of the case that would assist in a mediated settlement.
And what about that representative who is the “final decision maker with respect to all issues presented by the case who has the legal capacity to execute a binding settlement agreement”? In the context of large corporations involved in considerable amounts of litigation, such as insurance companies and banks, who will be tending the daily operations and financial management of the corporation if the final decision maker—often asked to be able to commit the corporation to a settlement of hundreds of thousands, if not millions of dollars, is out attending mediations most of the time? If a corporation must attend several mediation conferences within short time periods the logistics and cost of travel for this executive certainly would frustrate the purpose of reducing time and money spent on litigation. Alternatively, how many representatives could a company afford to provide full financial authority to at any given time period? And if the mediation happens to require decisions on something other than a dollar amount—such as changes in company policy, waiver of rights between the parties, or other business decisions, a whole new set of questions arise as to how many representatives—each one able to address a specific issue—a corporation must have personally attending. If mediation becomes a process that makes it difficult for these types of corporations to adequately monitor their own operations, it may discourage them from doing business in Florida in the first place.
There is no doubt that at times mediation conferences have not been attended with a good faith attempt to settle. Rule 1.720 provides for the parties to stipulate alternative procedures and alternative requirements for attendance. In all respects, to the extent that the parties work with each other, mediation will a successful means of resolving disputes. To the extent, however, that mediation makes it more difficult for a party to participate in the resolution process, it will work only to delay and increase the cost and complexity of litigation as a whole.