Beware Mediation Certificates of Authority

This month, the Second District Court of Appeal reversed a circuit court judge who agreed with exceptions taken to a magistrate's report and recommendation and entered a final order following a failure to show cause, thereby dismissing a residential foreclosure case with prejudice due to a bank's alleged failure to attend mediation. The court also entered a final judgment against the bank for attorney’s fees and costs pursuant to Section 57.105, Florida Statutes. This sanction was given because the bank had technically failed to attend court-ordered mediation because in not timely filing a certification of settlement authority required by Florida Civil Procedure Rule 1.720. Rule 1.720 authorizes a court to award sanctions that include attorney’s fees and costs and mediator expenses resulting from a party’s failure to appear. Violations of Rule 1.720 have typically been addressed only with monetary sanctions. As a mediator, we are not often copied on Certificates of Authority and are not involved in policing this filing, which is the court's domain. A party representative having full authority to settle under the rule means the final decision-maker with respect to all issues presented by the case who has the legal capacity to execute a binding settlement agreement on behalf of the party. Nothing about the rule requires any party or party representative who appears at a mediation conference in compliance with the rule to enter into a settlement agreement. The rule also requires that 10 days prior to the mediation, participants must file a certification of who will be attending the mediation on behalf of the party and who has the authority to settle the case. In the H&R Block Bank v. Perry matter, the complaint was filed on behalf of H&R Block by Nationstar Mortgage, LLC, a mortgage servicer, acting as H&R Block’s attorney-in-fact. At the outset of the case, H&R Block had filed a required form which stated that a representative of Nationstar would attend any mediation on behalf of H&R Block with authority to settle the case. The trial court subsequently entered an order referring the case to mediation. Three days before mediation, H&R Block filed a certification of settlement authority under rule 1.720. H&R Block’s certification was filed seven days later than Rule 1.720 requires. Because the trial court failed to make findings supported by the record that the conduct involved was willful, persistent, or otherwise aggravated and that no lesser sanction would be just under the circumstances, the decision was reversed. See opinion here-- http://www.2dca.org/opinions/Opinion_Pages/Opinion_Pages_2016/September/September%2009,%202016/2D15-1351.pdf

Sanctions for Shaq Skipping and Skyping into Mediation

In a Florida federal case, lawyers were sanctioned for advising their client, former NBA All-Star Shaquille O’Neal, that he didn’t need to personally attend court-ordered mediation. United States District Judge James Cohn of the Southern District of Florida ordered lawyers to pay $13,000 to cover mediation costs for a plaintiff who sued Shaq for allegedly ridiculing his appearance. Plaintiff has a rare genetic disorder that causes tooth loss and facial deformities and has since started an anti-bullying campaign on Facebook that attracted 20,000 members. Shaq posted a photo of himself on Instagram and Twitter stating "smile people" and imitating plaintiff's facial expressions. The lawsuit alleges defamation and invasion of privacy, though Shaq maintains there was no right to privacy because the photos were already on Instagram. He also said his conduct wasn’t so outrageous or extreme as to establish liability. Shaq reportedly attended via Skype and sent a representative to participate on his behalf, due to a television appearance conflict on the day of the mediation. The mediation order stated pursuant to Local Rule 16.2.E, the appearance of counsel and each party or a representative of each party with full authority to enter into a full and complete compromise and settlement is mandatory. The local rule says all parties shall be physically present at the mediation conference “unless excused in writing by the presiding judge.” Counsel argued unsuccessfully that the magistrate judge’s mediation order superseded the local rule, but local rule requires a federal district judge, not a magistrate judge, to excuse a party’s attendance in writing. See stories here-- http://bit.ly/1oLnNos and http://bit.ly/1oLnNos and local rule for court annexed mediation in the Southern District of Florida here-- http://1.usa.gov/1SYVSxx

Mediating Professor: Mediation Theory & Practice

Last week, I had the privilege of teaching the Mediation Theory & Practice class of my UWWM colleague Brandon Peters at FAMU College of Law. I was glad to find students bright and eager to learn the practical side of our profession. Our topic was representing clients at mediation. This required putting back on the advocacy hat and thinking about the process of mediation in a different way than in my daily job as mediator. As a neutral, we are motivated to facilitate the parties in making a decision for themselves. In examining how attorneys should represent clients at mediation, we reviewed the traditional role of a zealous advocate and what issues might arise during negotiations, such as lawyer-client conflicts of interest, non-economic concerns, and other potential inhibitors to a deal. Selecting attendees was also a big topic. In discussing this, we went over scenarios of a multi-party case and explored the attributes and potential influences of both large and small contingents at mediation, while keeping in mind confidentiality as paramount. Finally, we looked at preparation for mediation, including preparing the client and managing expectations for settlement. These components cannot be underestimated in achieving a successful result at mediation. It was truly refreshing to talk with law students about what we do as full-time neutrals on a regular basis and to be reminded of the important service that alternative dispute resolution neutrals provide to our court system.