Mediation Rule Changes in Florida

Lenders and servicers do not confuse the amendment to the rule of civil procedure with the requirements under the Administrative Order for each of the circuits.

Following the recommendation of the Florida Bar Committee on Alternative Dispute Resolution Rules and Policy, effective January 1, 2012, the Florida Supreme Court has adopted significant changes to the Mediation Procedures under rule 1.720. The Florida Supreme Court has amended the rule to strengthen the requirement that in order for someone to be regarded as having appeared at mediation through the appearance of a representative the party attending mediation have actual authority to settle the lawsuit. A Certification of Authority must be filed at least 10 days prior to the representative’s appearance that gives that person full authority to settle on behalf of the party. Following the adjusted rule, this representative must be 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.”

The new Rule 1.720:

• Sets forth a more detailed description of what it means for a party representative to have “full authority” to settle.  The party representative or an insurance carrier representative must be “the final decision maker” and have the “legal capacity to execute a binding settlement agreement.” Full authority to settle means the legal capacity to execute a binding settlement agreement on behalf of the party, without further consultation, up to the amount of Plaintiffs last demand or policy limits, whichever is less.
• Requires each party to file with the court, ten days in advance of mediation, written notice (Certification of Authority) of the party representative(s) appearing at the scheduled mediation and confirming those representatives have full authority.
• Provides that sanctions shall be imposed for failure to appear at mediation.  Failure to properly identify the party representative, or sending a different party representative to mediation than designated, shall create a “rebuttable presumption” that the violating party has “failed to appear” at mediation.

There is a distinction between the Fla. R. Civ. Pro 1.720 which can be requested or applied via court order to any type of case and the Administrative Orders enacted by the circuits pursuant to Supreme Court Administrative Order 09-54 and the clarified in Administrative Order 10-57.  The Administrative orders enacted by each of the Circuits allow the use of communication equipment to appear and most require the filing of a notice or designation of authority to settle.

As in the past, the request to appear via telephone must be made in advance if it is allowed under the Circuit Administrative order.

The amendment to Fla. R. Civ. Pro does not change the availability to have the representative with full authority to settle appear by phone. The amendments to the Fla. R. Civ. Pro are just making the Rule more in line with what is required under the Administrative Order for residential foreclosure actions. 

Essentially, the amendment to the Fla. R. Civ. Pro, usually used in other types of cases is now on an even playing field -- to the extent the rule now specifies who has the authority to settle etc. -- with the Administrative Order.   Lenders/Servicers still must comply with the filing of Form A and any other documents identified in the Administrative Order for the circuit in which the property sits.  Additionally, the new committee notes to the amended rule state the "elements of this rule are subject to the … qualification with the mutual consent of the parties."  --- which would be sufficient to allow a party to file a motion to appear via telephone at mediation for other types of cases.

The Servicers may see the rule used for cases where the property is non-homestead and opposing counsel files a Motion under Fla. R.Civ. Pro 1.720 for mediation.

Even under the Administrative Order in effect, the representative must have full authority to settle.  Similarly, the Administrative Orders have always required disclosure of the representative prior to the mediation (hence the reason an amended Form A is allowed or why many servicers include multiple names and contact information on the initial Form A.)