Thursday, June 24, 2010

Arbitration - Part IV

B. Selection of Arbitrators for Non-AAA Arbitrations

1. If an agreement for arbitration provides a method for the appointment of arbitrators, that method must be followed as long as it is fundamentally fair. Fla. Stat. § 682.04.

2. If there is no agreement or if the agreement fails, the court, on application of a party, shall appoint one or a panel of three arbitrators. Fla. Stat. § 682.04; Fla. R. Civ. P. 1.810(a). Each of the arbitrators must either: (a) be a member of The Florida Bar, with the chief arbitrator being a member of The Florida Bar for at least five years; or (b) serve on the arbitration panel with the written consent of all parties.

C. Arbitrators’ Jurisdiction and Scope of Submission

1. The following categories of actions may not be referred to arbitration by the Court:
a. bond estreatures.
b. habeas corpus or other extraordinary writs.
c. bond validations.
d. civil or criminal contempt.
e. any other matter specified by the chief judge in the circuit.
Fla. R. Civ. P. 1.800.

2. An arbitrator exceeds his or her power when he or she goes beyond the authority granted by the parties through the operative document and decides an issue not within the scope of the arbitration clause or not pertinent to the resolution of the issues submitted to arbitration. Chandra v. Bradstreet, 727 So. 2d 372 (Fla. 5th DCA 1999), rev. den., 741 So. 2d 1134 (Fla. 1999); Applewhite v. Sheen Fin. Res., Inc., 608 So. 2d 80 (Fla. 4th DCA 1992).

3. The Federal Arbitration Act controls where an arbitration agreement expressly provides that the agreement was made pursuant to a transaction involving interstate commerce and would be governed by the Federal Arbitration Act. Checksmart v. Cardegna, 824 So. 2d 228 (Fla. 4th DCA 2002). The Federal Arbitration Act, however, is outside the scope of these materials.

4. Statutory and intentional tort employment claims are also arbitrable, such as hostile work environment, malicious defamation, tortious interference with business relationships and intentional infliction of emotional distress, where the parties are subject to a written arbitration contract that provides for binding arbitration of "any and all claims and disputes that are related in any way to my employment or the termination of my employment." Henderson v. Idowu, 898 So. 2d 451 (Fla. 4th DCA 2002).

Tuesday, June 15, 2010

Arbitration - Part III.

B. Waiver of Right to Arbitrate

1. The right to arbitration under an agreement may be waived by taking actions inconsistent with the arbitration provision. The court (not the arbitrator) determines whether a party to an arbitration agreement has waived its contractual right to arbitration by its subsequent conduct. Florida Educ. Assoc. v. Sachs, 650 So. 2d 29 (Fla. 1995).

2. Where one party actively participates in litigation which is the subject of an arbitration agreement before moving to compel arbitration, that party is deemed to have waived any right to compel arbitration. Hansen v. Dean Witter Reynolds, Inc., 408 So. 2d 658 (Fla. 3d DCA 1982), rev. den., 417 So. 2d 328 (Fla. 1982); Ojus Indus., Inc. v. Mann., 221 So. 2d 780 (Fla. 3d DCA 1969).

3. Such a waiver will be found where the party files an answer or affirmative defenses, takes discovery or files any claim for affirmative relief in a lawsuit, including a counterclaim before moving to compel arbitration. Coral 97 Assocs., Ltd. v. Chino Elec., Inc., 501 So. 2d 69 (Fla. 3d DCA 1987); Winter v. Arvida Corp., 404 So. 2d 829 (Fla. 3d DCA 1981); but see Avid Engineering, Inc. v. Orlando Marketplace Ltd., 809 So. 2d 1 (Fla. 5th DCA 2001) (motion for arbitration and counterclaim at same time does not waive right).

4. “All questions concerning the scope or waiver of the right to arbitrate under contracts should be resolved in favor of arbitration rather than against it.” GBR3 v. Largo Dev. Corp., 807 So. 2d 723 (Fla. 3d DCA 2002), quoting Beverly Hills Dev. Corp. v. George Wimpey of Fla., Inc., 661 So. 2d 969, 971 (Fla. 5th DCA 1995).

Monday, April 26, 2010

Arbitration - Part II

B. Commencement and Submission to Arbitration to AAA

1. A party to an existing dispute may commence an arbitration under the AAA’s rules by filing two copies of a demand for arbitration, signed by the party or its attorney with AAA’s regional office. (See for various forms and rules). The demand must contain a statement of the nature of the dispute, the names and addresses of all parties, the amount of the claim, if known, the remedy sought, the hearing locale requested and the name and address of the respondent. The demand must also attach a copy of the arbitration clause in question.

2. Under AAA’s Commercial Arbitration Rules, the respondent to the arbitration is not required (but is encouraged) to file an answer to the claims, in which case they will be deemed denied. If the respondent desires to assert a counterclaim, then it must comply with substantially all requirements as those for a demand for arbitration.

C. Compelling Arbitration and Stays

1. After a dispute arises, the threshold issue is whether there is a right to arbitration of the dispute. If such a right is present, a motion to compel arbitration is appropriate where a party files a legal action and refuses to participate in the arbitration. When a party to an agreement refuses to arbitrate, application may be made to the court for an order directing the party to proceed with arbitration. Fla. Stat. § 682.03(1). Upon application, the court must decide the following:

a. Whether a valid written agreement exists containing an arbitration clause;

b. Whether an arbitrable issue exists that is encompassed within the scope of the arbitration clause; and

c. Whether the right to arbitration has been waived.
Orkin Exterminating Co. v. Petsch, 872 So. 2d 259 (Fla. 2d DCA 2004); Flyer Printing Company, Inc. v. Robbin Hill, 805 So. 2d 829 (Fla. 5th DCA 2001); Stinson-Head, Inc. v. City of Sanibel, 661 So. 2d 119 (Fla. 2d DCA 1995), rev. dism., 671 So. 2d 788 (Fla. 1996); North American Van Lines v. Collyer, 616 So. 2d 177 (Fla. 5th DCA 1993); Piercy v. School Bd. of Washington County, 576 So. 2d 806 (Fla. 1st DCA 1991).

2. If the court decides that there is an arbitrable issue, it must compel arbitration. If the court determines that there is an issue concerning the making of the agreement or waiver, it must summarily hear and resolve the issue. Fla. Stat. § 682.03 (1). See also Bill Heard Chevrolet v. Wilson, 877 So. 2d 15 (Fla. 5th DCA 2004).

3. Where an arbitration clause is valid and not interdependent with the remaining clauses of an agreement, any offending or unlawful provision contained therein could be severed without affecting the intent of the parties or the agreement to arbitrate. Healthcomp Evaluation Serv. Corp. v. O’Donnell, 817 So. 2d 1095 (Fla. 2d DCA 2002).

4. If an underlying contract containing an arbitration clause is challenged as void ab initio, it is submitted to arbitration, unless the challenged is to the specific arbitration clause. Buckeye Check Cashing, Inc. v. Cardegna, 126 S.Ct. 1204 (U.S. Feb. 21, 2006).

5. Whether a demand for arbitration was timely served is a question of fact to be decided by the arbitrator, not the trial court. CED Construction, Inc. v. Kaiser-Taulbee Assoc., Inc., 816 So. 2d 813 (Fla. 5th DCA 2002).

6. An action to rescind a contract in its entirety may be subject to arbitration where the contract contained an arbitration clause and the validity of that clause was not specifically attached, as opposed to the whole contract. Sanchez v. Criden, 899 So.2d 326 (Fla. 3d DCA 2005).

7. When a dispute within the scope of an arbitration provision is pending before a state court, a stay of the court action may be obtained pending the outcome of the arbitration. If the issue subject to the arbitration is severable from the remainder of that action, the stay should apply only to the dispute that is subject to arbitration. Fla. Stat. § 682.03(3).

8. When an arbitration has begun or is about to begin, a party challenging the right to arbitrate may obtain a stay by applying to the court. The court must summarily hear and determine the issue and grant or deny the application for the stay of the arbitration proceedings. Fla. Stat. § 682.03(4).

9. A party may be bound to arbitrate a dispute even though the party did not physically sign a written contract to arbitrate. See, e.g., Fleetwood Enters., Inc. v. Gaskamp, 280 F.3d 1069, 1074 (5th Cir. 2002) (agency required non-signatory to arbitrate); Qubty v. Nagda, 817 So. 2d 952 (Fla. 5th DCA 2002) (investors suing stockbrokers compelled to arbitrate under thirty-party beneficiary theory); Employers Ins. of Wausau v. Bright Metal Spec., Inc., 251 F.3d 1316 (11th Cir. 2001); Thomson-CSF, S.A. v. American Arbitration Ass’n, 64 F.3d 773, 776 (2d Cir. 1995); Gottfried, Inc. v. Paulette Koch Real Estate, Inc., 778 So. 2d 1089 (Fla. 4th DCA 2001). See also Pritzker v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 7 F.3d 1110 (3d Cir. 1993).

10. On the other hand, courts have refused to require non-signatories to arbitrate in various circumstances. See, e.g., Benasra v. Marciano, 112 Cal. Rptr. 2d 358 (2001) (president of corporation who signed contract in corporate capacity could not be compelled to arbitrate individually); Thomson-CSF, S.A. v. Am. Arbitration Ass'n, 64 F.3d 773 (2d Circ. 1995) (corporate parent not required to arbitrate on claim relating to subsidiary's arbitration agreement).

11. The Pritzker Case -

a. The trustees of a profit sharing plan brought suit against a brokerage company and one of its brokers alleging, among other claims, breach of fiduciary duty arising from alleged mismanagement of pension funds. Pritzker, 7 F.3d at 1113.

b. In response to the defendants’ motion to compel arbitration under an arbitration provision located in the contract governing the relationship between the trustees and the brokerage firm, the trustees argued that their claims against the individual broker were not subject to the arbitration agreement because the broker was not a signatory to the underlying contract. Id. at 1121.

c. The Third Circuit Court of Appeals rejected this argument finding that the broker, as an agent and representative of the brokerage firm, was bound by the brokerage firm’s arbitration agreement under traditional agency principles. Id. See also Drulcrest Pty. Ltd v. Jamar Prods., Inc., No. 85 Civ. 2174 (PNL), 1986 WL 4547, at *2-3 (S.D. N.Y. April 11, 1986).

12. The Drulcrest Case -

a. A promoter brought suit against a theatrical producer alleging that the producer failed to perform its obligations under the parties’ touring agreement. Drulcrest Pty. Ltd., 1986 WL 4547, at *1. The promoter also brought suit against the escrow agent named in the Touring Agreement alleging that the escrow agent breached its fiduciary duties with respect to the funds placed in escrow under the Touring Agreement. Id.

b. The Touring Agreement contained an agreement to arbitrate and was not signed by the escrow agent. Id. In response to a motion to compel arbitration, the promoter argued that the claim against the escrow agent was not subject to arbitration because the escrow agent was not a signatory to the underlying agreement containing the arbitration clause. Id. at *2. In rejecting this argument as “irrelevant,” the district court found that the escrow agent was bound by the agreement to arbitrate under ordinary contract and agency principals. Id.

c. The district court found that by agreeing to act as the escrow agent under the Touring Agreement and by accepting the escrow funds, the escrow agent signified its intent to be bound by the arbitration provisions under the Touring Agreement. Id. at *3.

13. A party who personally guaranteed the obligations of another under a written agreement containing an arbitration clause was bound as a matter of law to arbitrate the dispute regarding the guarantee. Berti v. Cedars Healthcare Group, Ltd., 812 So. 2d 580 (Fla. 3d DCA 2002).

14. Where a party was appointed as the agent for a principal who was bound to a contract containing an arbitration clause, agent must arbitrate all disputes relating to the contract. URS Koechli v. BIP Int'l, 870 So. 2d 940 (Fla. 1st DCA 2004).

15. Arbitration provisions are binding on third-party beneficiaries of a contract that contains an arbitration provision, provided that the contract clearly expresses an intent to primarily and directly benefit the third party. Technical Aid Corp. v. Tomaso, 814 So. 2d 1259 (Fla. 5th DCA 2002).

16. In the absence of a signature, a party may still be bound by an arbitration clause contained in a contract, if the party’s conduct indicates that the party agreed to be bound by the contract in question. Thomson-CSF, S.A., 64 F.3d at 776. One’s intention to be bound by a contract containing an arbitration clause may be evidenced by one’s performance under other provisions of the contract. Chanchani v. Salomon/Smith Barney, Inc., No. 99 CIV 9219 RCC, 2001 WL 204214, at *3 (S.D. N.Y. March 1, 2001); Frynetics (Hong Kong) Ltd. v. Quantum Group, Inc., No. 99 C 4704, 2001 WL 40900, at *4 (N.D. Ill. Jan. 11, 2001) (party’s attempts to comply with other terms of the contract bound the party by the arbitration provision in the same contract); In the Matter of the Arbitration Between John Thallon & Co., Inc. and M&N Meat Co., 396 F.Supp. 1239 (E.D. N.Y. 1975) (party’s participation in performance under other provisions of a contract evinced such party’s intention to be bound by the contract’s arbitration provision).

17. Even if not joined in the arbitration, a surety on a construction bond can be bound by the results of an arbitration. Fewox v. McMerit Constr. Co., 556 So. 2d 419, 425 (Fla. 2d DCA 1990).

Thursday, April 22, 2010

Arbitration - Part I

A. The Arbitration Process

1. As opposed to mediation, arbitration results in a binding or non-binding decision of the dispute.

2. The arbitrators consider the evidentiary presentations of the parties and then render an award, which may then be confirmed by a court of competent jurisdiction.

B. Arbitration Agreements

1. The following is a sample clause for the arbitration of all future disputes between the parties before the American Arbitration Association (AAA):

Any controversy or claim arising out of or relating to this contract, or the breach thereof, shall be resolved and determined by binding arbitration administered by the American Arbitration Association under its Commercial Arbitration Rules, and judgment on the award rendered by the arbitrator(s) shall be entered in any court having jurisdiction thereof.

2. Arbitration through the AAA for existing disputes may be accomplished by use of the following agreement, independent of any contract in question:

We, the undersigned parties, hereby agree to submit to binding arbitration administered by the American Arbitration Association under its Commercial Arbitration Rules the following controversy: (describe dispute). We further agree that we will faithfully observe this agreement and the rules, that we will abide by and perform any award rendered by the arbitrator(s), and that a judgment of any court having jurisdiction thereof shall be entered on the award.

3. To expedite matters, any arbitration clause can expressly adopt the summary procedures of Chapter 51, Florida Statutes, or customized summary procedures set forth in the clause itself. The arbitrators and the administrator of the proceeding are mandated to comply with those procedures.

4. The arbitration clause may provide for emergency interim relief by incorporating the AAA’s optional rules for emergency measures of protection or other applicable emergency rules, such as applicable Florida Rules of Civil Procedure.

5. Arbitration clauses may also expressly provide for:

a. The number of arbitrators;

b. The specific minimum qualifications for the arbitrators;

c. The method of and responsibility for payment for the fees and costs associated with the arbitration;

d. The locale for all hearings and the use of any discovery tools, including depositions under the Florida Rules of Civil Procedure;

e. Any other item of concern to the parties.

6. The Arbitration Administrator.

a. It is not necessary to require an arbitration (or mediation) to be administered by the AAA or that the proceeding be governed by its rules.

b. The Florida Rules of Civil Procedure include arbitration rules and most experienced arbitrators (and mediators) are prepared to administer any arbitration (or mediation) themselves. Any qualified dispute resolution organization or individual may be named as the administrator.


Arbitration is especially appropriate in industries which require specialized knowledge for their resolution. The parties can require a minimum number of years experience in the industry or other qualifications, such as board certification or specialized licensure.

The above clauses may be rendered unenforceable for any claim asserted pursuant to statutory rights, such as Truth-in-Lending or employment discrimination claims, if payment of any arbitration fees would be unduly burdensome so as to deny the statutory rights in question. See, e.g., Green Tree Financial Corp. v. Randolph, 531 U.S. 79 (2000).

In the interest of complete candor, the author discloses that he is a member of the American Arbitration Association's commercial, financial and employment arbitration and mediation panels.

Friday, April 16, 2010

Mediation - Part IV

B. Mediated Settlement Agreements.

1. Mediated settlement agreements reached at a court ordered mediation are unenforceable unless signed by the parties and their counsel. Fla. R. Civ. P. 1.730(b). However, at least one court has held that a mediated settlement agreement which was not signed by counsel, but was signed by the parties was not rendered unenforceable based upon such a technical deficiency where the parties conducted themselves as if they had reached a binding agreement. Jordan v. Adventist Health System/Sunbelt, Inc., 656 So. 2d 200 (Fla. 5th DCA 1995).

2. Further, mediated settlement agreements may not may be enforced where a party can demonstrate that the agreement was reached through coercion or any other improper tactics utilized by the mediator. Vitakis-Valchine v. Valchine, 793 So. 2d 1094 (Fla. 4th DCA 2001). If the mediator fails to substantially comply with the requisite practices and procedures, no party to the mediation may “rightfully claim the benefits of an agreement reached in such a way.” Id. at 1099.

3. Based upon the court’s inherent power to maintain the integrity of the judicial system, a “court-ordered mediation settlement agreement obtained through violation and abuse of the judicially-prescribed mediation procedures” may be invalidated. Id.

4. Cases settled in mediation are not suited for the liberal application of Florida Rule of Civil Procedure 1.540(b) allowing rescission of a settlement agreement based on unilateral mistake because mediation, like arbitration, is an alternative dispute resolution device and a more stringent standard of review applies. Tilden Groves Holding Corp. v. Orlando/Orange County Expressway, Etc., 816 So. 2d 658 (Fla. 5th DCA 2002).

C. Mediation Impasse

1. There may be various reasons for impasse. A party may truly evaluate its case or its opponent based upon significantly different criteria, making the parties' settlement negotiation ranges too far apart to broach. In that instance, the parties may feel they would be better served having a third party, such as a judge, jury or arbitrator decide the pending dispute. It is important for the parties in such a case to fully understand the range of possible outcomes, along with the costs of going forward, including all legal fees, expert fees, deposition costs and other court costs.

2. Sometimes the parties are not able to reach a compromise because one or more parties are emotionally vested in their case or the events that lead up to the dispute. In that instance, the emotional party often needs to feel they had the opportunity to tell their story, whether at the mediation or at a hearing. This need cannot be underestimated as a prerequisite for settlement, especially where an apology can be given.

Monday, April 12, 2010

Mediation - Part III

A. The Mediation Conference

1. If a party fails to appear at a duly noticed mediation without good cause, the court upon motion shall impose sanctions against the party failing to appear. Those sanctions may include an award of the mediator’s and attorney’s fees and costs. Fla. R. Civ. P. 1.720(b).

2. If a party is a public entity operating under Chapter 286, Florida Statutes, the entity is deemed to have appeared by the physical presence of a representative with full authority to negotiate on behalf of the entity and to recommend settlement to the appropriate decision-making body of the entity. Fla. R. Civ. P. 1.720(b).

3. Except for such public entities and unless stipulated by the parties or changed by court order, a party is deemed to appear at a mediation if the following persons are physically present at the mediation:

a. The party or its representative having full authority to settle without further consultation;

b. The party’s counsel of record, if any; and

c. A representative of the insurance carrier for any insured party who is not such carrier’s outside counsel and who has full authority to settle up to the amount of the plaintiff’s last demand or policy limits, which ever is less, without further consultation.

Fla. R. Civ. P. 1.720(b).

4. Pursuant to Florida Rule of Civil Procedure 1.720(b), a party’s failure to appear at a mediation without good cause requires the trial court to impose sanctions, including both mediator costs and attorney’s fees. Carbino v. Ward, 801 So. 2d 1028 (Fla. 5th DCA 2001). In Carbino, defendants failed to appear at a court-ordered mediation, but their insurance carrier’s representative appeared with full authority to settle up to the policy limits. The plaintiff, however, had not agreed to limit his demand to such limits. Under these facts, the appellate court agreed with the trial court’s finding that the defendants had failed to “appear” at the mediation and the trial court was required to impose sanctions against them. Id.

5. At all times, the mediator shall be in control of the mediation and the procedures to be followed in the mediation. Fla. R. Civ. P. 1.720(2)(d).

6. Each party to a mediation has the privilege to prevent any person present at the mediation from disclosing communications made during the mediation. Fla. Stat. § 44.102(3).

7. However, Section 44.102(3), Florida Statutes, would not be applied to preclude evidence supporting claim that a mediated settlement agreement contained a clerical error so as to lead the court to an unreasonable conclusion. Dr Lakes, Inc. v. Brandsmart U.S.A. of West Palm Beach, 819 So. 2d 971(Fla. 4th DCA 2002), quoting Holly v. Auld, 450 So. 2d 217, 219 (Fla. 1984); but see Feldman v. Kritch, 824 So. 2d 274, 276 (Fla. 4th DCA 2002) (no exception for “unilateral mistake”).

8. If one party unlawfully discloses such communications to any person not present at the mediation, the disclosing party may be subject to sanctions by the court, including striking the party’s pleadings for violating the mediation privilege. Paranzino v. Barnett Bank of So. Fla., 690 So. 2d 725 (Fla. 4th DCA 1997).

9. Evidence of settlement negotiations may be admissible in a federal criminal investigation or trial. There appears to be split of authority among the federal courts on the issue. See U.S. v. Gonzalez, 748 F.2d 74, (2nd Cir. 1984); Manko v. U.S., 87 F.3d 50 (2nd Cir. 1996); U.S. v. Meadows, 598 F.2d 984 (5th Cir. 1979); U.S. v. Hays, 872 F.2d 582 (5th Cir. 1989); U.S. v. Logan, 250 F.3d 350 (6th Cir. 2001); U.S. v. Prewitt, 34 F.3d 436 (7th Cir. 1994); U.S. v Arias, 431 F.3d 1327 (11th Cir. 2005).

10. Mediation must be completed within 45 days of the first mediation conference unless extended by order of the court, the arbitrators or by stipulation of the parties. Fla. R. Civ. P. 1.710(a).

11. For the most part, the mediation conference is conducted in at least two stages.

a. Joint Session: Initially, the mediator will conduct a joint caucus in which the mediator and then each attorney will give brief opening statements. Each party should be advised by their attorneys prior to the mediation that they will hear certain statements from the opposing attorney with which the party may disagree. Nevertheless, each attorney and his or her client, if they desire, will have the full opportunity to be heard without interruption. Each person attending the mediation is expected to act in a civil, respectful manner to all other persons present.

b. Private Caucus: After the joint session, the mediator will separate the parties and their respective attorneys into private sessions or caucuses in which they may feel more free to candidly discuss other aspects of the dispute and how it may be resolved.

12. Although attendance at any court ordered mediation is mandatory, participation in the process is completely voluntary. It is a party's right to refuse to compromise or settle any claim and to have their day in court. Fla. R. Civ. P. 1.730(a).

13. “Decisions made during a mediation are to be made by the parties. A mediator shall not make substantive decisions for any party. A mediator is responsible for assisting the parties in reaching informed and voluntary decisions while protecting their right of self-determination.” Fla. R. Med. 10.310(a) (emphasis added).

14. Indeed, the mediation conference is an opportunity for the parties to control the outcome of the case and to fashion a resolution to the dispute which is certain and may encompass terms which an arbitrator or a court may not otherwise be able to award.

B. Mediator’s Report On Mediation Conference

1. If no agreement is reached, the mediator must report the lack of an agreement to the court without comment or recommendation. With the consent of the parties, the mediator’s report may also identify any pending motion or outstanding legal issues, discovery process, or other action by any party which, if resolved or completed, would facilitate the possibility of a settlement. Fla. R. Civ. P. 1.730(a).

2. The mediator is also required to report to the court the names of all persons who attended the mediation. Fla. R. Civ. P. 1.720.

Friday, April 9, 2010

The Mediation Process - Part II

C. Agreements to Mediate

1. If the parties wish to require mediation with the American Arbitration Association (“AAA”), for all future disputes relating to a contract before any arbitration or litigation can be commenced, the following mediation clause may be added to the contract:

If a dispute between the parties arises out of or relates to this contract, the breach thereof, or any performance or obligation due hereunder, and if the dispute cannot be settled through direct negotiation, the parties agree first to try in good faith to settle the dispute by mediation administered by the American Arbitration Association under its Commercial Mediation Rules before resorting to arbitration, litigation, or some other dispute resolution procedure.

2. If the parties wish to require mediation for all future disputes relating to a contract before any arbitration or litigation can be commenced, but not with any particular association or ADR service, the following mediation clause may be added to the contract:

If a dispute between the parties arises out of or relates to this contract, the breach thereof, or any performance or obligation due hereunder, and if the dispute cannot be settled through direct negotiation, the parties agree first to try in good faith to settle the dispute by mediation pursuant to applicable Florida Rules of Civil Procedure and Florida Statutes governing mediations before resorting to arbitration, litigation, or some other dispute resolution procedure.

3. If the parties wish to mediate an existing dispute, they may enter into the following agreement, independent of any contract:

The parties hereby submit the following dispute to mediation pursuant to applicable Florida Rules of Civil Procedure and Florida Statutes governing mediations: (describe dispute).


The parties hereby submit the following dispute to mediation administered by the American Arbitration Association under its Commercial Mediation Rules: (describe dispute).

D. Selection of the Mediator

1. The parties may agree on the appointment of any person to act as the mediator for any mediation conference. As long as the parties agree, the mediator does not need to be certified. Fla. R. Civ. P. 1.720(f)(1)(B). Depending on the level of “reality checking” the parties would like the mediator to undertake, the parties should consider the substantive experience of the mediator and any areas of expertise.

2. In the absence of the parties’ agreement, the court may only appoint a certified mediator to conduct a mediation conference. Fla. R. Civ. P. 1.720(f). The chief judge of each judicial circuit is required to maintain a list of certified mediators who have registered for appointment in that circuit. Fla. Stat. § 44.102(4).

E. Pre- Mediation Summaries

1. Florida Statutes do not specifically provide for the submission of pre-mediation summaries; however, it is a common practice. Unless ordered by the court or requested by the mediator, mediation summaries are not required to be provided or mutually exchanged by the parties. If done, these summaries are confidential, privileged communications. Fla. Stat. §§ 44.102(3) and 90.408.

2. Rule M-9 of the AAA’s Commercial Mediation Rules requires that, at least ten days prior to the first scheduled mediation session, each party is to provide the mediator with a brief memorandum setting forth their position with regard to the issues that need to be resolved.

3. Most standard mediation orders and mediator engagement letters require the parties to provide the mediator with a brief summary. Mediation summaries are very helpful for the mediator to determine how best to approach the mediation.

4. Mediation summaries should include the following:

a. a brief introduction of the parties and their respective lawyers;
b. a brief summary of the relevant facts;
c. a summary of the status of the case, i.e., whether depositions have been taken, whether the case is set for trial, whether the action is a bench trial or is a jury trial, etc.;
d. a breakdown of any monetary and non-monetary relief sought in the action, including whether attorney’s fees are recoverable;
e. the history of prior settlement negotiations, including all offers and counter offers.

Wednesday, April 7, 2010

The Mediation Process - Part I

A. The Mediation Process

1. Mediation is a process whereby a neutral third person encourages and facilitates the resolution of a dispute between two or more parties in an informal proceeding to help the parties reach a voluntary binding agreement. Fla. Stat. § 44.1011(2); Fla. R. Med. 10.210.

2. The mediator does not make any rulings or decisions for the parties. Fla. R. Med. 10.310. The mediator may not give the parties any legal advice, but the mediator may discuss the possible outcomes of the lawsuit or arbitration if not settled, as well as the potential strengths and weaknesses of the parties’ positions in the case. Fla. R. Med. 10.370. The process is conducted in an informal non-adversarial manner. The objective of the mediation is to reach a mutually acceptable agreement. Fla. R. Med. 10.410.

B. Mediation Order

1. A circuit or county court is required to order the parties to a civil lawsuit to mediation if one party requests mediation and the lawsuit is for monetary damages, provided the requesting party is willing and able to pay the costs of the mediation or the costs can be equitably divided between the parties, unless:

a. The action is a landlord and tenant dispute that does not include a claim for personal injury.

b. The action is filed for the purpose of collecting a debt.

c. The action is a claim of medical malpractice.

d. The action is governed by the Florida Small Claims Rules.

e. The court determines that the action is proper for referral to non-binding arbitration.

f. The parties have agreed to binding arbitration.

g. The parties have agreed to an expedited trial.

h. The parties have agreed to voluntary trial resolution.
Fla. Stat. § 44.102(2)(a).

2. A circuit or county court may order the parties to mediation for any civil lawsuit for which mediation is not otherwise required. Fla. Stat. § 44.102(2)(b).

3. Under no circumstances may the following actions be referred to mediation:

a. Bond estreatures.
b. Habeas corpus and extraordinary writs.
c. Bond validations.
d. Civil or criminal contempt.
e. Other matters specified by administrative order of the chief judge in the circuit.
Fla. R. Civ. P. 1.710(b).

4. When a civil action is referred to mediation by court order, the time period for responding to any settlement offer under Florida Statute § 45.061 or an offer or demand pursuant to § 768.79 is tolled until an impasse has been declared by the mediator or the mediator has reported to the court that no agreement was reached. Fla. Stat. § 44.102(5)(a).

5. Unless ordered by the court or stipulated by the parties, the mediation process shall not suspend discovery. Fla. R. Civ. P. 1.710 (c).

Tuesday, February 2, 2010

When is presuit mediation appropriate?

We all agree that the timing of when to conduct a mediation is almost as important as who is selected as the mediator. Legal disputes are sometimes appropriate to mediate before any suit is filed. In most instances, those are disputes that have well defined facts and documents have already been voluntarily exchanged by the parties. These cases are ripe for presuit mediation.
Parties are willing to resolve their disputes when they can make educated decisions based upon a universe of known facts and legal advice. If, however, there are too many open questions, any presuit mediation will not likely be successful unless one side is desperate and needs to settle no matter what.

Please post your thoughts on this topic.