Business Law 101 / Mediation

By Albert L. Kelley

Mediation is a chance for the parties to a lawsuit (or potential lawsuit) to resolve their dispute on their terms rather than handing the case over to a judge.  The theory is that the parties know their case better than a judge ever will.  They know the strengths and weaknesses.  A judge can never learn all the nuances of a case.  Further, the parties have a vested interest in the outcome of a case, while the judge does not.  For all their training and education, the job of the judge is to determine which side prevails.  But when the case is over, the judge moves on to the next case while the parties must live with the results.  This is not a fault of our judicial system, just the truth of it.

Mediation is a process.  Understanding the process helps it work.    The mediator is not a judge or an arbitrator.  The Mediator does not make a ruling. They act as a facilitator, working with the parties to help craft a settlement that both sides can live with.  Every mediator comes to the process with their own style, although they all went through similar training.   It is not a formal proceeding.  There are very few rules to a mediation.  Things said in a mediation cannot be used later in the litigation.  In addition the mediator cannot be subpoenaed to testify in court as to what happened.  Even the report the mediator gives to the Court only states that a full agreement was reached, that a partial agreement was reached, or no agreement was reached.  None of the details of the mediation are revealed.  The reason for this is to encourage the parties to communicate.  If the parties know their comments cannot be used against them, they are more likely to open up.  Through Alternative Dispute Resolution, we have learned that communication is the best way to resolve a dispute.

The second rule is specific to the mediator.  At some point in most mediations, the mediator will separate the parties.  This is referred to as “caucusing”.  Anything a party tells the mediator in the caucus is confidential to the caucus.  The mediator can only reveal those details to the other party that   they are specifically authorized to reveal.  The reason for this is to encourage the parties to communicate with the mediator.  The more information the mediator has, the more likely they are to assisting resolving the case.

The third rule regards the settlement.  If the parties reach a settlement, it is put in writing at the end of the mediation and signed by the parties.  The reason the agreement must be written and signed is to finalize the mediation.  The last thing you want is to go through an entire mediation, reach a settlement and then have someone develop seller’s/buyer’s remorse and back out of the agreement. This settlement agreement is immediately enforceable.  The settlement agreement may be filed with the court but does not need to be.

Nearly every case before the Court is now required to go through mediation before trial.  Even in small claims courts, the County provides mediators at no cost to the litigants at the pre-trial conference.

The parties to a lawsuit are often not comfortable initially with mediation.  They come in with a predetermined position.  Many parties want to stop quickly, but often mediations can take hours and sometimes even days. The benefit of mediation is that the parties are not restricted in how they resolve the case, in the same way a judge is.  They are free to craft any settlement that they can agree on.  They can even reach resolutions that were not thought about initially or that the court would be precluded from considering.  The key is to keep an open mind and allow the process to work.  In most cases, mediation will be able to resolve the case without further court intervention.

Al Kelley is a Florida business law attorney located in Key West and previously taught business law, personnel law and labor law at St. Leo University.  He is also the author of four law books: (“Basics of Business Law” “Basics of Florida’s Small Claims Court”, “Basics of Florida’s Landlord/Tenant Law” and “Basics of Starting a Florida Business” (Absolutely Amazing e-Books)). This article is being offered as a public service and is not intended to provide specific legal advice.  If you have any questions about legal issues, you should confer with a licensed Florida attorney.

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