MEAC Opinion 2016-004 (Date Issued: November 6, 2016)
The vast majority of cases settle, and many of those deals get hammered out with the help of a Florida Supreme Court certified mediator (like yours truly).
What may come as a surprise to some is that certified mediator’s have their own set of mandatory ethics rules, which means we need to do things a certain way. And when we’re not sure what to do, the Florida Supreme Court’s Mediator Ethics Advisory Committee (MEAC) will issue advisory opinions upon request.
Case in point: What do the mediator ethics rules tell us to do when all sides agree they have a verbal handshake deal, but can’t get it all drafted and signed up before going home for the night? That’s the question dealt with in this MEAC opinion.
The ground rules:
We all know that a settlement agreement’s not binding unless it’s in writing and signed by the parties (and their counsel). So saith Fla. Civ. Pro. R. 1.730(b):
If . . . agreement is reached, it shall be reduced to writing and signed by the parties and their counsel, if any. . . . A report of the agreement shall be submitted to the court or a stipulation of dismissal shall be filed. . . . The mediator shall report the existence of the signed or transcribed agreement to the court without comment within 10 days thereof. No agreement under this rule shall be reported to the court except as provided herein.
And if you’re a certified mediator, Fla. R. Med. 10.420(c) says part of your job is making sure this all gets done right. Here’s the actual text of that rule:
The mediator shall cause the terms of any agreement reached to be memorialized appropriately and discuss with the parties and counsel the process for formalization and implementation of the agreement.
The dreaded “handshake” deal:
So what’s a mediator to do if you’re in that grey zone between a verbal understanding and a written contract? That’s not an uncommon occurrence. Larger, more complex cases often take all day to negotiate, it might be the middle of the night before all sides agree they have a handshake deal. By then everyone’s too tired and bleary-eyed to start drafting a written settlement agreement, but all sides are confident they do in fact have a deal. In this scenario should a mediator file a report saying the parties reached agreement (and hope the deal doesn’t fall apart during the drafting stage)? Or do you report NO agreement?
In MEAC Opinion 2016-004 we’re told the ethical thing to do is none of the above. Instead, as a mediator your job is to give all sides a fair chance to write up their contract and, to the extent your assistance is asked for, do what you can to help. Once the deal’s signed up, then you file your report with the court in accordance with Fla. Civ. Pro. R. 1.730(b). If after a while the lawyers report the deal’s fallen apart, then you report NO agreement. In the meantime, stand fast.
The way MEAC opinions work is that mediators submit specific questions and the committee responds with an answer to each question. Here are the specific questions and answers published in this opinion:
Question 1:
If Rule 10.420(c) states that a “mediator shall cause the terms of any agreement to be memorialized appropriately,” how does the mediator comply with Rule 10.420 without confirming that the verbal agreement is actually reduced to writing and signed?
MEAC Answer:
When mediating cases subject to the Florida Rules of Civil Procedure, a mediator cannot comply with rule 1.730(b) without confirming that the verbal agreement has been reduced to writing and signed by all parties and their attorneys, if any. The method by which the mediator complies with rules 10.420(c) and 1.730(b) together is determined by the mediator.
Question 2:
If Rule 1.730 requires an agreement to be reduced to writing and a mediator cannot file a report until that agreement is reduced to writing and signed, how does achieving a verbal agreement at mediation satisfy the mediator’s obligation to cause the agreement to be “memorialized appropriately?”
MEAC Answer:
Rule 1.730(b) cannot be satisfied by a verbal mediation agreement. In MEAC 2015-005, the Committee noted that rule 10.420(c) does not require the mediator to write something regarding the terms of the agreement prior to the close of the mediation session if the parties have agreed who will memorialize the agreement and the process for its formalization.
Question 3:
If a mediator has “an obligation” to comply with Rule 1.730, does the mediator have a responsibility under Rule 10.420(c) to follow up with the parties and their counsel to make sure the verbal agreement is actually reduced to writing and signed consistent with the requirements of Rule 1.730(b), Rule 10.520, and the Committee Notes for Rule 10.420?
MEAC Answer:
When mediating cases subject to the Florida Rules of Civil Procedure, the mediator has an obligation to follow up with the parties and their counsels to make sure the verbal mediation agreement is reduced to writing and signed by all parties and their attorneys, if any, prior to making a report to the court.
. . .
Question 5:
Rule 1.730(b) states: “No agreement under this rule shall be reported to the court except as provided herein.” If MEAC believes the mediator has “memorialized appropriately” the terms of the agreement by merely achieving a verbal agreement between the parties, what can the mediator report to the court pursuant to Rule 1.730(b) if the parties have not reduced their agreement to writing and secured the necessary signatures? Which rule or statute permits a mediator to report to the court the existence of a verbal agreement?
MEAC Answer:
In the example presented, the mediator would report “no agreement” under rule 1.730(b). There is no provision in Chapter 44, Mediation Alternatives to Judicial Action, or any Florida trial or appellate court procedural rule that authorizes a mediator to report a verbal mediation agreement to the court.