Mediation Minute

Attendance Rules at Mediation and Other Oddities

February 17, 2022

Few topics engender debate more than the issue of proper attendance at mediation. Even mediators do not agree on the rules and willingly tolerate a breach or some bad practice.

There is a fair amount of problematic behavior largely arising from good intentions but myopic vision. We could start with the language of the written rules but those aren’t really much help. There are four rules:

Rule #1 -You have to show up.

Rule #2 – Everyone has to file a certificate of authority 10 days before mediation.

Rule #3 If you have insurance coverage, the carrier representative must appear with “full authority” which means having authority up to the plaintiff’s last demand or policy limits whichever is less.

Rule #4 – Everything said is confidential and privileged except for the statutory exceptions in §44.405(4)(a).

Breaking Down the Rules and the Reality

If one is true to the principal of self-determination, which is the existential lynchpin of the process here in Florida, then each side should be able to bring whomever they please. The other side doesn’t have to like it.

But state court rules modify this so that the carrier’s designee must possess authority determined by the limits of the policy or the plaintiff’s last demand. Neither is an appropriate standard.

First, because limits are a function of several factors including insurability, premium costs, market forces, total assets, and risk tolerance – all of which are underwriting factors wholly irrelevant to the specifics of the claim.

The Asymmetry of the Authority Rule

Requiring the defendant’s carrier to have authority as a function of the plaintiff’s demand is even more asymmetrical. The rule permits the plaintiff to indirectly control the attendee from the other side by making a monetary demand that need not bear any semblance to the reality of what is likely to be paid.

We don’t require the plaintiff to attend based upon any preconditions set by the defendant. Why should an arbitrary or even good faith demand by claimant’s counsel influence whom the defense brings to the table? That’s like one side getting to decide the anchor man for the other side before a tug of war begins.

Sorry, no thank you. The defense camp can figure out for themselves who they need to bring to the tug of war.

The Excused Absence is a Problem

In some circles, usually in personal lines, the insurance defense lawyer requests the insured be excused from attendance, ostensibly because the money is coming from the carrier and no insured contribution is anticipated.

This is not an unreasonable position on the surface, but there are a host of reasons why this this is a bad idea, a really bad idea. Perhaps some lawyers routinely agree to excuse the insured because they got COVID and are not able to sniff what they are stepping in.

There is no rule permitting the parties to waive attendance. Nor does the mediator have that power. A court order excusing attendance is required.

Second, what if there are non-economic terms demanded that require the insured/defendant’s compliance like an apology, a change in company policy, confidentiality, or non-disparagement terms?

Third, what if the Plaintiff demands a contribution from the insured above the policy limits? If you are a defense lawyer, excusing the insured/defendant opens you up to a later claim for malpractice if the case does not settle and later goes badly for the client. The aggrieved client will may complain that he or she was insulated from critical information in mediation and the opportunity to urge settlement.

Let’s look at it from the Claimant’s side. Why would the Claimant’s attorney want to forgo the opportunity to address the Defendant personally?

Maybe the argument is you agree to excuse the insured because you want to play “nice” with the opposing side and the carrier. This is a good sentiment, as I have urged honey over vinegar for a long time, but this is a time when being nice is actually hurtful.

The Cathartic Value of Mediation

What message does the Defendant’s absence send to the Claimant? That their claim is trivial? Doesn’t the Claimant expect and deserve the opportunity to address the Defendant, even vicariously through their attorney?

Mediation provides an underappreciated but valuable emotional outlet for the Claimant. But if the Defendant is not there to hear it, you may have removed the cathartic drainpipe for emotional release needed to achieve unclouded and rational decision-making.

It’s not a good practice to excuse attendance, and it invites later claims of inadequate representation. The inconvenience of attendance does not, in my view, outweigh the practical and ethical problems that not infrequently surface in a party’s absence.

In one particularly sad case I mediated, the defense lawyer learned for the first time in mediation that his insured/defendant was suffering from cancer with trial a few months away and likely beyond the client’s life expectancy.

Had the insured been excused from mediation, that information would not have come out when it did, the case was doomed to impasse, and the defense would have blown a settlement opportunity and had a big problem on the eve of trial. You don’t normally get such shocking information, but you frequently do get material information from the client.

Certification of Authority is an Ethical Quagmire

The “certification” of authority rule in Florida is flawed because it requires the defendant (in truth, defense counsel) to file a paper certifying the carrier representative (non-client) has the requisite authority. Neither the insured nor the defense lawyer hired by the carrier are typically privy to the conversations leading to the choice of insurance representative.

Neither the client nor defense counsel determine what the carrier will pay and the lawyer defending the insured has no business warranting the authority of the carrier representative.

How can the insured Defendant vouch for the carrier’s actions? What if there are two or three carriers participating in the defense of a common insured? Is the Defendant to certify the authority of each carrier representative? What if there is a primary and excess policy?

However laudable the intent and purpose of the certification rule, it cannot withstand analytical scrutiny and creates an ethical problem for the defense lawyer in every case.

A Potential Work-Around to the Problem

There is an imperfect solution. Have the carrier representative sign the certificate of authority. As for attendance, there is no rule governing how long you have to stay. A client can check the box and leave immediately after the mediation starts, but that is hardly wise. Stuff frequently happens at mediation you cannot always predict.

Remote attendance is now common and always a better alternative than a purposeful absence. The problem with an excused absence is that you will never know what information was not disclosed, and you cannot ever know whether someone’s absence will impact the process and the ability to achieve resolution.