New Mediation Requirements Put New Burdens on Corporate Entities in Litigation

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September 14, 2012

By Bart R. Valdes, Esq., and Amber Ashton, Esq.

The Florida Supreme Court has revised the rules relating to mediation and new requirements have been imposed on corporations and other business entities that are involved in litigation.  Rule 1.720, Florida Rules of Civil Procedure, provides the basic requirements for all mediations in Florida.  The purpose of the amendments is to make sure that business entities send someone who has real decision making ability to mediation so that all settlement alternatives can be considered without the need of getting additional corporate approvals.

The Rule has been slightly modified and now provides the following in regard to appearance at mediation:

(b) Appearance at Mediation. Unless otherwise permitted by court order or stipulated by the parties in writing, a party is deemed to appear at a mediation conference if the following persons are physically present:

(1) The party or a party representative having full authority to settle without further consultation; and
(2) The party’s counsel of record, if any…

Pursuant to the Rule 1.720(e), ten (10) days prior to mediation, each party is required to serve written notice on the other parties and the court identifying the persons attending the mediation and confirming that those persons in attendance have full settlement authority.  Rule 1.720(c), defines “party representative having full authority to settle” to “mean 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.”  This is significant because it imposes a requirement that business entities make decisions well in advance of mediation as to who to send to mediation.  Also, it imposes a requirement to designate someone who has a position or status within the entity so that they possess real authority to make decisions without having to consult additional management personnel or other decision makers.

There are also now sanctions available under Rule 1.720(f), for failure to appear at mediation, the failure to timely file the Certificate of Authority discussed in more detail below, or for the failure of those persons identified in the Certificate of Authority to appear at mediation.  As such, compliance with these new requirements is very important.

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