Arbitration Case Law Update
July | August 2020
By: Donna Greenspan Solomon, Esq.
Anderson v. Am. Gen. Life Ins. Co., 802 Fed. Appx. 548 (11th Cir. 2020) (arbitrator faced with jurisdictional challenge was not required to hear evidence of whether employer breached optional and informal dispute resolution procedure or whether employer’s upper management knew about rigged sales contest used to decide promotion at issue).
Mason v. Midland Funding LLC, 18-14019, 2020 WL 2466370, at *4 (11th Cir. May 13, 2020) (defendant failed to show that plaintiff agreed to arbitrate by assenting to clickwrap agreement that was part of online credit application where evidence did not establish that plaintiff ever received or knew of arbitration agreement).
Iglehart v. Mitbank USA, Inc., 285 So. 3d 331 (Fla. 4th DCA 2019) (Co-trustee did not waive right to arbitration under land trust agreement by filing suit under contemporaneous but separate trust management agreement).
4927 Voorhees Rd., LLC v. Tesoriero, 291 So. 3d 668, 673 (Fla. 2d DCA 2020) (arbitration agreement containing improper damages and fees provisions could be severed from arbitration agreement; conflict certified with Novosett v. Arc Villages II, LLC, 189 So. 3d 895 (Fla. 5th DCA 2016)).
Hobby Lobby Stores, Inc. v. Cole, 287 So. 3d 1272 (Fla. 5th DCA 2020) (Arbitration agreement was not procedurally unconscionable, even though employee asserted he had a high school education, did not know what arbitration was, and believed he had no choice but to sign it; arbitration agreement’s operative terms were not hidden, minimized, or buried in fine print, there was no evidence that employee could not read the agreement or that corporation pressured, rushed, or coerced him into signing it, and employee did not allege that corporation made false representations to induce him to sign it, or that he asked any questions about the agreement, or that he expressed any confusion about its terms, or that he lacked opportunity to inquire into the agreement’s terms or to enlist help if confused).
Efron v. UBS Fin. Services Inc. of Puerto Rico, 45 Fla. L. Weekly D309 (Fla. 3d DCA Feb. 12, 2020) (trial court erred in confirming $9.7 million arbitration award where panel denied motion for postponement due to withdrawal of counsel, giving no specific reason).
Ciccarello v. Siena Villas at Beach Park Condo. Ass’n, Inc., 45 Fla. L. Weekly D568 (Fla. 2d DCA Mar. 11, 2020) (appellate court lacks jurisdiction to review arbitration award in absence of timely-filed motion for trial de novo in circuit court pursuant to section 718.1255(4)(k), Fla. Stat.).
Doe v. Natt, 45 Fla. L. Weekly D712 (Fla. 2d DCA Mar. 25, 2020) (clickwrap agreement stating that any arbitration would be administered by American Arbitration Association (AAA) in accordance with its rules did not constitute clear and unmistakable evidence of parties’ assent; agreement was silent on issue of arbitrability, agreement’s reference to AAA rules was broad, nonspecific, and cursory, and AAA rule that arbitrator shall have power to rule on scope or validity of arbitration agreement or arbitrability of any claim conferred adjudicative power on arbitrator but did not make that power exclusive or contractually remove adjudicative power from court).
H Greg Auto Pompano, Inc. v. Raskin, 45 Fla. L. Weekly D702 (Fla. 3d DCA Mar. 25, 2020) (although section 682.03, Florida Statutes, requires a stay while motion to compel arbitration is pending, the statutory language does not mandate a stay during appeal of denial of motion to compel; noting difference with Eleventh Circuit in Blinco v. Green Tree Servs., LLC, 366 F.3d 1249, 1253 (11th Cir. 2004) (litigation should be stayed so long as appeal is non-frivolous)).
City of Hollywood v. Perrin, 45 Fla. L. Weekly D694 (Fla. 4th DCA Mar. 25, 2020) (employee’s complaint that city erroneously calculated his longevity and seniority contained arguable allegation of unfair labor practice, over which Public Employees Relations Commission (PERC) had exclusive jurisdiction, and thus trial court could not compel arbitration).
Timmons v. Lake City Golf, LLC, 45 Fla. L. Weekly D797 (Fla. 1st DCA Apr. 7, 2020) (final judgment provided former partner with sole recourse process contemplated in arbitration, and thus was not flawed for failing to give him right of execution and final process).
CWELT-2008 Series 1045 LLC v. Park Gardens Ass’n, Inc., 45 Fla. L. Weekly D1001 (Fla. 3d DCA Apr. 29, 2020) (plaintiff waived right to demand arbitration on counterclaim that was “flip side” of claim it had actively litigated).
Donna Greenspan Solomon is one of three attorneys certified by The Florida Bar as both Business Litigator and Appellate Specialist. Donna is a Member of the AAA’s Roster of Arbitrators (Commercial Panel). She is a FINRA-Approved and Florida Supreme Court Qualified Arbitrator. She is also a Certified Circuit, Appellate, and Family Mediator. Donna is a Member of the Florida Supreme Court Committee on Standard Jury Instructions—Contract and Business Cases. Donna can be reached at (561) 762-9932 or Donna@SolomonAppeals.com or by visiting www.solomonappeals.com.
For additional ADR tips and resources, please go to the ADR Committee page of the updated Palm Beach County Bar Association website at www.palmbeachbar.org.
ADR in Florida, The Severe Lack of Diversity
By: Lawrence Gordon
What do the Academy Award Nominations, the National Football League and ADR in Florida have in common? There is an appalling lack of diversity in each of them.
All are controlled by white men. In most cases, older white men who are adept at protecting the status quo and fighting the tides of change. Some argue that diversity should not be considered in the arts, professional sports, and even ADR. Therein lies the problem.
People of color didn’t receive Oscar Nominations and African American assistant coaches didn’t receive consideration for head coaching positions despite seventy-five percent of league players being African American. Of the thirty-two NFL teams, only two Head Coaches were African American in 2019.
According to the Florida Dispute Resolution Center, there are approximately thirty-two hundred Supreme Court Certified Circuit Civil Mediators in the state. Unfortunately, only 3.8 percent or 122 are men and women of color.
People of color are often excluded from the process. One cannot win if one is not allowed in the game. Seeking quality and seeking diversity aren’t mutually exclusive. The belief that diversity will work itself out without being fostered and nurtured is rubbish. Diversity isn’t created by good thoughts and well-meaning. One creates diversity deliberately and intentionally. Bias must be recognized and rooted out for diversity to exist and thrive. Access and power are rarely given up voluntarily. This usually requires strong and direct actions for change.
In 2006-2007, the Florida Supreme Court changed the rules of qualifications for one to become a mediator.
It created a path for non-lawyers to become Certified Mediators. The lack of diversity among Florida mediators contributed to this rule change. In a 2019 report, Judicial Arbitration and Mediation (JAMS) called on the legal profession to work harder toward diversity. It asked firms to institute the Mansfield Rule which urges firms to actively pursue diverse candidates for at least thirty percent of their employees.
This is very similar to the Rooney Rule in the NFL which requires any team with a head coach opening to interview at least one candidate of color. While these are admirable efforts, they are voluntary and very little has changed.
Mediation firms have made it difficult for non-lawyer mediator candidates to participate in the ten apprentice mediations required for certification. They argue that many of these candidates are not qualified, open them to serious liability exposure and take jobs from lawyers. Nonsense, Malpractice insurance covers any errors and certainly the Supreme Court considered these issues before changing the rules. Some mediation firms argue that there are too many mediators. How can that be when Florida’s population is approximately 21.5 million and there are only five thousand six hundred in all categories of Certified Mediators? What they really should be saying is, if there is an excessive number of mediators, it is because there are too many who are white males. Perhaps it should become mandatory for these firms to mentor a certain number of mediator candidates of color each year to remain in good standing with the Florida Bar. The lack of diversity must change.
The larger and more diverse the pool, the greater the chance for new ideas, growth, and perspectives. ADR can be used to push diversity forward by using a diverse list of Mediators and Arbitrators.
In 2018, business mogul and rapper, JayZ was involved in a $204 million-dollar arbitration. He noticed there were few African American arbitrators for him to select. He complained to the court, which agreed that the lack of African American arbitrators was discriminatory under the Constitution of New York State. Again, this situation demonstrates a need for greater diversity.
Recently, I received a call from a prominent personal injury law firm about mediating a case that had been mediated twice before however, remained unresolved. I accepted the case, and after several hours, it was clear that the lack of diversity was an important issue.
The two previous mediators had been white males. The injured plaintiff was the only person of color involved. I suspect that I was selected because I’m a person of color. The plaintiff felt that his interest wasn’t being protected because he had never seen anyone who looked like him. Fortunately, I was able to assist in getting the case resolved. The plaintiff, just as JayZ, felt the process had been discriminatory.
How can the mediation process be fair and equitable if people of color aren’t involved in meaningful numbers? The pool of mediators should reflect the racial, ethnic and gender diversity of the community. Sixteen percent of Florida’s population, over three million, are African American. How can we justify having just over two hundred mediators of color in all Certified categories? There are seven mediators of color in the 15th Judicial Circuit, covering Palm Beach County, an area of 1.5 million people. These statistics are an indictment of the mediation industry and clearly indicate that the problems are both systemic and institutional. Diversity is about strength, not weakness. There is something about every group that can improve the whole. The ADR community must do better.
For additional ADR tips and resources, please go to the ADR Committee page of the updated Palm Beach County Bar Association website at www.palmbeachbar.org.
Effective Mediation Summaries
By: William J. Cea, Esq.
We have all been to mediations where hours are spent identifying issues, back and forth with factual inquiries, and assisting the mediator to determine terms that need to be negotiated. This may just be part of the mediation process. However, an effective mediation summary can help make the process more efficient. Supplying the pleadings and a description of the case status is helpful, however, I would suggest giving some thought to providing background and insights that will make the process as efficient as possible.
The following are some tips for preparation of an effective mediation summary. First, provide the operative pleadings and a copy of any pending dispositive motions. Next, if there have been any rulings that impact the scope of trial or available remedies you should expound on that. Beyond the pleadings, pending motions and rulings, provide an explanation of what discovery has occurred and what is left to be done. Importantly, this is an opportunity to explain what facts or points have been established in discovery vs. facts and matters that are left to be discovered. The facts yet to be discovered oftentimes manifest as an impediment to settlement. For example, in a construction case even if the parties agree that a defective condition(s) exists, does the defense know how much it will cost to repair? If the cost of repair is something left to be determined or discovered, that should be explained in the summary.
Additionally, how much has been incurred in costs and fees and how much is yet to be incurred? Is there a basis for the recovery of attorney’s fees? Have the parties served Offers of Judgment/Proposals for Settlement? The mediator needs to understand the substance of the case, but it is also important to understand the economics which also drive motivations. We all know that the cost of litigation is usually a practical reality for the parties, and the mediator needs to understand how economics play into the dispute.
Further, are there matters of concern or practical terms that may not be subject of the claims or available relief, but could serve as incentives to settle the case. This is part of the beauty of mediation. The parties are not bound by the four corners of the pleadings and relief that may be awarded by a court or arbitrator. By way of another example in a construction scenario, maybe a contractor disputes the extent of damages. Would the contractor be willing to provide or extend a warranty to help compensate the property owner? Clearly, there are terms that you can seek in mediation that are not available as legal or even equitable remedies that may bridge the gap of the typical monetary negotiation. Brainstorming the what ifs and laying some of that our in a mediation summary will help you prepare for mediation and aid the process.
Thus, the bottom line is that mediation is a process and will usually require some time before the parties can “get down to business”. However, you can facilitate a more efficient process and reduce some of the frustration that participants have with the amount of time and sitting in caucus sessions by providing an effective mediation summary.
William J. Cea, Esq. is a Shareholder with Becker & Poliakoff, P.A., and is based in the firm’s West Palm Beach Office. Mr. Cea is a Board Certified Construction Attorney and Certified Circuit Court Mediator. Mr. Cea concentrates his practice in the areas of construction defects litigation, public procurement and mediation. Mr. Cea has lectured for several organizations, on topics such as mediation and construction law, including The Florida Bar, the Florida Association of Public Procurement Officials, Inc., the Construction Owners Association of America, Nova Law School, and the Palm Beach County Bar Association. He may be reached at (561) 820-2888, or via email at email@example.com.
For additional ADR tips and resources, go to https://www.palmbeachbar.org/adr-2
Important Questions to Ask as a Mediator
By: Jeffrey H. Marcus
This article discusses important questions that every mediator should consider asking counsel, the parties, and themselves, before and during a mediation. Why should a mediator ask himself or herself questions? I think that mediators ought to possess an emotional intelligence quotient. The following questions are meant to be a suggestion, not an exhaustive list.
I. Why Asking Questions is Important
A. Asking Questions Enables Us to Satisfy Our Professional Obligations
The Florida Supreme Court is empowered by Florida Statutes §44.106(1)(2019) to establish minimum standards for professional conduct for mediators certified under Chapter 44. Various Florida Supreme Court Rules that impose standards of conduct may be met only by asking questions. Such Rules include:
Rule 10.220 Mediator’s Role
Rule 10.300 Mediator’s Responsibility to the Parties
Rule 10.320 Nonparticipating Parties.
Rule 10.330 Impartiality
Rule 10.350 Demeanor
Rule 10.630 Professional Competence
It is beyond the scope of this article to discuss these Rules in detail. A few examples will illustrate the point that mediators must ask questions. Rule 10.220 requires mediators to “reduce obstacles to communication, assist in the identification of issues and exploration of alternatives, and facilitate voluntary agreements”. Rule 10.300 provides that a mediator’s responsibility to the parties includes honoring the right to self-determination, acting with impartiality, avoiding coercion, improper influence, and conflicts of interest, and exhibiting appropriate demeanor. Rule 10.330 mandates mediator impartiality and defines impartiality as “freedom from favoritism or bias”.
B. Asking Questions Allows Us to Practice Mindfulness
Mindfulness has been defined as the practice of paying purposeful attention to the
present moment without judgment. The American Bar Association (ABA) has endorsed mindfulness for lawyers and has established the ABA National Task Force on Lawyer Well-Being. Mindfulness is also a useful practice for mediators.
Mediators must be aware of and be prepared to manage the emotional
aspects of the disputes before them. Asking questions is an effective way to gauge the emotional dimensions of the dispute. Practicing mindfulness may also help mediators really listen to the parties and their counsel, remain impartial, and exhibit required professionalism.
II. Questions a Mediator Ought to Ask Counsel Prior to Mediation
Some of the questions that a mediator ought to consider asking counsel for the parties before a mediation include the following.
What are the main issues in the dispute?
Do you have any questions about my role or the mediation process?
Is there a business or other relationship between the parties that your client wants to preserve?
What is the status of the dispute?
Is counsel aware of any emotional or trigger issues on either side?
Are there any special precautions necessary to ensure a safe mediation environment?
III Questions a Mediator Ought to Ask Himself or Herself Prior to Mediation
Some of the questions that a mediator ought to ask oneself before a mediation include the
After reading the materials provided by and speaking with counsel for the parties, am I adequately informed and still neutral about the issues?
Am I confident about my role and my ability to effectively and properly mediate this dispute?
IV. Questions a Mediator Ought to Ask Counsel During the Mediation
Some of the questions that a mediator ought to ask counsel for the parties during the mediation include the following.
What are your/your client’s goals for this mediation?
What would help you achieve your goals?
What are the obstacles to resolving the dispute?
What do you need to learn from the other party(ies)?
Can you think of any creative ways to resolve this dispute?
V. Questions a Mediator Ought to Ask the Parties During the Mediation
What can I do to help you feel this mediation is a safe environment?
Do you have any questions about my role or the mediation process?
Are you authorized to settle this dispute? If not, then who is?
VI. Questions a Mediator Ought to Ask Him or Herself During the Mediation
Whether I have listened carefully to the parties and their counsel so that I can facilitate their negotiations?
Whether I have learned anything during the mediation that has challenged my professional competence?
Whether I have maintained impartiality?
Whether I’ve used all of the tools available to facilitate the parties’ self-determination of a negotiated settlement?
The questions we ask as mediators are of the utmost importance to conducting optimal mediations. We should ask questions that are designed to provide a safe environment for the parties to communicate, be creative in resolving disputed issues, and ultimately to settle their disputes on terms acceptable to them. We also need to be mindful of how we respond to the stimuli of the parties, their counsel, and the dynamic information exchange of the negotiations both before and during the mediation.
For additional ADR tips and resources, please go to the ADR Committee page of the newly updated Palm Beach County Bar Association website.
Jeffrey H. Marcus is in solo practice in Wellington. His practice focuses on business law, employment law, equine law, and mediation. He is a Florida Supreme Court Civil Circuit Certified Mediator. He is admitted in Florida, New York and Pennsylvania. Jeff may be contacted at firstname.lastname@example.org. His website is at https://marcuslawoffice.com.
Do You Do These Things Before and after Your Mediations?
By: Richard Lord
I write from the perspective of having been a civil trial mediator for the past 20 years. Before the mediation, there are several things, beyond explaining the process to your client and preparing your summaries and presentation, that you, as an attorney, can do to increase the odds of success at the mediation and of having a satisfied, if not happy, client. Your client needs to be involved in the identification of “the good, the bad, and the ugly” of their case so that a realistic understanding of your limitations in working on their behalf can be developed before the heat of the moment of mediation arrives. It will allow them to listen to and work with you through the uncertainties and likely disappointment and frustration that are often a part of successful mediations. Part of this advance work should include the running of various scenarios and options along with the rough probabilities so your client can understand in advance why it may be wise to consider an outcome far different than what they may feel is their entitlement or you may view as their best case. Your mediator may well ask you your thoughts on the probabilities and it may be better for your client to have already heard it and to have already gone through an analysis of the law, facts of the case, and factors that may lend credibility or support one way or the other. If the first time they hear about it is at the mediation, there is a greater risk that they will not like the analysis when they must be able to make decisions based upon it. And telling them before the mediation means they will be hearing it from you and maybe the mediator for the second or third time, thus increasing the likelihood their decision-making will be consistent with a rational process as opposed to unreasonable expectations, emotion or other motivator.
It is also important that your client truly understand the multiple hats the litigator wears when it comes to mediation. You are both their advocate and their counselor, and those two hats are starkly different. Too many mediations see clients emboldened by the opening statement of their able advocate. You should tell your client that you have two hats, one of the advocate when you are speaking for them to the other side; and the counselor hat when it’s just you, them and perhaps the mediator in the room. Tell them about those two hats before the mediation so they are mentally prepared for your gymnastics. Being clear about that helps you avoid having your client gain confidence from your opening or rebuttal comments to the mediator in caucus. Explain to them that your advocacy is designed to maximize their outcome and that your counseling is geared toward their being smart and realistic. Remind them that they should not take talk focused on uncertainty and risks in caucus as being inconsistent with your advocacy or as an indication you are changing your mind. Doing so will help them be a reasonable and informed business partner with you in the mediation and, when you reach settlement, they won’t think you took them somewhere out of weakness.
What should you do when the case does not settle? What happens next is the typical focus. Some responses are familiar such as keeping an open mind and encouraging your client to do so; considering who now needs to be deposed, what new manner of proposal should be made, what evidence requested, motions filed or experts retained. Your thoughts typically focus on what needs to happen to get it settled or what needs to be done to get ready for trial or other adjudication. But there is something I suggest you do that will help you in future mediations for this client and if not, certainly for others. Too few litigators do it. I suggest that after each mediation that does not result in settlement you try to come up with at least three possible reasons for the impasse or adjournment. That list should influence your preparation for future mediations. Perhaps not each thing you identify was a cause of what happened, and adjusting accordingly won’t guarantee that your next mediation results in settlement, but you will be building greater awareness of factors you can address in advance of and during each mediation going forward. By actively deconstructing and learning about the process each time, you will become a more effective advocate for and counselor to future clients in the mediation process. To learn even more, we hope you’ll attend the Mediation Committee’s presentation “You Can Always Be a Better Negotiator” at the Palm Beach County Bar Association’s Bench Bar Conference on March 20, 2020. And for additional tips and resources please visit the ADR committee page on the Palm Beach County Bar Association’s newly updated website.
Richard has been a mediator with Upchurch, Watson, White & Max since 1999. Until 2016 he lived in Orlando and worked predominantly in Central Florida. Now, from the firm’s office in West Palm Beach, he mediates throughout South Florida as well. Richard is on the Council of the American Bar Association’s Section of Dispute Resolution, is a Fellow of the American College of Civil Trial Mediators (ACCTM) and is listed by the National Association of Distinguished Neutrals. You can learn more about him at https://www.uww-adr.com/biography/richard-lord and he can be reached through his assistant, Norma Abreu, at (561) 533-7553.
Calm, Control, and Common Sense: How Mindful Meditation Can Lead to Mindful Mediation
By: Adam Myron
I am going to ask you to do something counterintuitive: when you get to the end of this paragraph, stop reading and close your eyes. Slowly take three deep breaths, inhaling fully and exhaling fully. Then resume a normal breathing pattern and with each breath, count upward until you reach the number 10. If you start thinking of work, or what you’re going to have for lunch, or something else, that’s fine; notice the thought for what it is, but try to return your focus to your breath and resume counting. Once you have completed this exercise, return to this article. Are you ready? Get set. Go.
Now take a moment to explore how you feel after engaging in that exercise (which is just one of many ways to engage in mindfulness meditation). Studies show that regular practice can help reduce stress, regulate emotions, and increase awareness and self-control, and I suspect that you feel calmer and more focused than you felt a few moments ago. I am convinced that the physical, psychological, and emotional benefits of mindfulness meditation can lead to better outcomes at mediation.
In mediation, there are typically four kinds of participants: parties to a dispute, legal advocates, insurance claim representatives, and mediators. As human beings, they bring to mediation their own perspectives, biases, and emotions. For the parties on each side, passion frequently runs high, compassion frequently runs low, and judgment is easily clouded by ego, perceived past slights, and the general stress associated with being in an adversarial proceeding. Enter the mediator, whose job it is to impartially facilitate the conflict resolution process.
Under such circumstances, how can everyone increase the likelihood of finding common ground? By trying to remove the impediments to clear thinking: ego, indignity, and stress. And what is the easiest way to achieve that end? By seeking the benefits of mindfulness: increased awareness and self-control, regulated emotions, and reduced stress.
To those who are unfamiliar with mindfulness, this may seem hard to believe. But to regular practitioners, the correlation between mindful meditation and mindful mediation should be obvious because the primary effects of mindfulness – reflective thinking, controlled emotion, the engagement of higher thought processes, and consideration of outside perspectives – are essential to rational negotiation.
Indeed, few things are better for settling differences than understanding other people’s thoughts, feelings, and perspectives. It has been suggested that a successful mediation occurs when each side walks away equally unhappy. I do not subscribe to that theory. Instead, I believe that mediation participants can take positive steps to repair broken relationships and find common ground. I also believe that through mindful mediation, where the participants are calm and controlled and use common sense, subtle shifts in perspective can transform zero-sum game negotiations into opportunities for mutual gain.
As an illustration, imagine that two children are arguing over an orange. The first child claims she should have the orange because she was the one who found it. The second child argues that the orange should be his – after all, it was his idea to play outside, and if he hadn’t made that suggestion, the first child wouldn’t have found the orange. The first child can’t believe that the second child isn’t familiar with the age-old principle of “finders keepers”; the second child can’t understand why the first is so self-righteous.
The children finally decide that the only fair way to resolve their differences is to split the orange in half between them. Before they do, though, a mindful mediator intervenes. The mediator asks the children to explain why they want the orange, thus seeking an understanding of each child’s values. The first child says she is hungry. The second child explains that he needs the orange to bake a cake.
By this point, the mindful mediator will have ratcheted down the tension and injected into the situation a sense of calmness and structure – necessary elements for rational thinking. Understanding the children’s values, the mediator then asks if their goals could be achieved by peeling the orange, giving the first child the entire fruit to eat, and giving the second child the entire rind to use for the cake. Seeing the opportunity for each of them to walk away with a better outcome than if they had split the orange in half, the children decide to settle on those terms. Moreover, because each child does not feel that anything was sacrificed for the other’s gain, their long-term relationship does not suffer.
Though obviously less complex than some high stakes negotiations, this story teaches an important lesson for any negotiation: slowing down, keeping a cool head, and taking emotions out of high pressure situations can lead to better outcomes for the parties. In that way, achieving the benefits of mindful meditation can lead to more mindful mediation.
Adam Myron is an attorney with the law firm of Day Pitney LLP, where he focuses on complex commercial and business litigation, trust and estate litigation, and professional liability litigation. Adam is also a Florida Supreme Court Certified Circuit Mediator and a Florida Qualified Arbitrator. You can email him at email@example.com.
For additional ADR tips and resources go to https://www.palmbeachbar.org//adr-2.