Small Claims Rules’ Amendment Impacts Mediation + A Question

The Florida Supreme Court, in In Re: Amendments To Florida Small Claims Rule 7.090, Case No. SC07-1724 [Fla. 2008] amended Florida’s Small Claims Rules regarding notification to the parties that mediation may occur at the pretrial conference and that sanctions may be imposed against a party whose representative fails to appear with “full authority to settle”. The effective date of the change is October 1, 2008.

Fla. Sm. Cl. R. 7.090(f) reads as follows [the underlined language reflects the amendment]:

(f) Appearance at Mediation; Sanctions. In small claims actions, an attorney may appear on behalf of a party at mediation if the attorney has full authority to settle without further consultation. Unless otherwise ordered by the court, a nonlawyer representative may appear on behalf of a party to a small claims mediation if the representative has the party’s signed written authority to appear and has full authority to settle without further consultation. In either event, the party need not appear in person. Mediation may take place at the pretrial conference. Whoever appears for a party must have full authority to settle. Failure to comply with this subdivision may result in the imposition costs and attorney fees incurred by the opposing party.

The Court also adopted a change to Form 7.322. Summons/Notice To Appear For Pretrial Conference.

Please be sure to read the Court Commentary [Thank you for that!] to the newly revised Rule which is fully illustrative of the bedrock mediation principle of party self-determination!

I have a question, though, and that is how will the lack of authority to settle be properly brought to the attention of the trial judge without violating the Mediation Confidentiality and Privilege Act [F.S. 44.401 - 44.406]? This is a problem within the Florida Rules of Civil Procedure as well, in particular Fla. R. Civ. Pro. 1.720(b). There are 2 draft alternatives to this Rule developed by the Alternative Dispute Resolution Rules and Policy Committee to address this problem. Please click here to see what they are and to add your input – really, please assist. Your comments are all reviewed and discussed by the Committee.

To email me, click Perry S. Itkin.

“Would Have, But . . .” “Should Have, But . . .” “Could Have, But . . .” – “Didn’t!”

In Leff and Physicians Financial Consultants Corporation v. Ecker, M.D., 972 So.2d 965 [Fla. 3rd DCA 2007], the plaintiff went into the mediation conference without a clear picture of what the insurance policy limits were. Notwithstanding this limited knowledge, plaintiff chose to go ahead with the mediation and entered into an agreement at the end of mediation.

The Defendants filed a motion to enforce the mediated settlement agreement [Guess why! Good guess!]. The Plaintiff argued that a “mutual mistake” allowed him to avoid the parties’ mediated settlement agreement.

Not so fast according to the Third District Court of Appeal:

A party to an agreement bears the risk of mistake when he is aware, at the time the contract is made, that he has only limited knowledge with respect to the facts to which the mistake relates but treats his limited knowledge as sufficient.

The doctrine of mutual mistake was not created to relieve litigants of agreements entered into improvidently. The all-out efforts plaintiff later engaged in to go behind the policy and ascertain, without question, what policies applied and what policy limits were, could have been performed before the mediation. [Emphasis added.]

The appellate court reversed the trial judge and remanded the case for the entry of an order enforcing the settlement agreement.

By the way, what about confidentiality? Although not mentioned in the opinion, Florida’s Mediation Confidentiality and Privilege Act [F.S. 44.401 – 44.406] includes certain permitted, although limited, disclosures. For example, F.S. 44.405(4)(a)(5) provides there is no confidentiality or privilege for any mediation communication:

Offered for the limited purpose of establishing or refuting legally recognized grounds for voiding or reforming a settlement agreement reached during a mediation.

But, you knew that – right?!? Anyway, it will be time well spent taking another look at the statute.

To email me, click Perry S. Itkin.