The Right Way to Do the Right Thing

Upchurch Watson White & Max

Mediation Group

and the University of Florida

Levin College of Law

Institute for Dispute Resolution

The Right Way to Dothe Right Thing

are proud to cosponsor today’s Webinar:

Our moderator, Sandy Upchurch

Mediation CounselUpchurch Watson White & [email protected]

uww-adr.com

Our presenter,Robert A. Cole

ShareholderUpchurch Watson White & [email protected]

uww-adr.com2

Our guest,Rutledge R. Liles

Managing partnerLiles, Gavin & George, [email protected]

www.lilesgavin.com

mailto:[email protected]

http://www.uww-adr.com/


http://www.uww-adr.com/


http://www.lilesgavin.com/

The Right Way to Dothe Right Thing

Ethical Dilemmas In Mediation

Slides based on a presentation by Lawrence M. Watson;Fact scenario by Lawrence M. Watson

(http://bit.ly/fact_scenario)

http://bit.ly/fact_scenario

Ethical Standards - References

• ABA Model Rules of Professional Conduct

• ABA/SOL – Guidelines for Ethical Settlement Negotiations

• www.abanet.org/litigation/ethics/settlementnegotiations

• Fla. Rules For Certified & Court Appointed Mediators

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http://www.abanet.org/litigation/ethics/settlementnegotiations

The Case:Peter Polyps v.

Vibra-GlowFertilizers, Inc.

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Peter Polyps v. Vibra-Glow Fertilizers, Inc.

• Peter Polyps – Plaintiff

• Melody Maters – Plaintiff’s attorney

• Vibra-Glow Fertilizers, Inc. – Defendant

• Bluesuit, Whiteshurtz & Tassels – Vibra-Glow corporate counsel

• Slippery Mutual Insurance Co. – Vibra-Glow’s insurer

• Bill Billum – insurance-appointed defense counsel for Vibra-Glow

• Roy Reconcile – case mediator 6

Accepting the EngagementConflicts of Interest – Mediator

Roy Reconcile Mediation, Inc.

• Compromised Impartiality?

• Non Waivable

• Conflict?

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Accepting the EngagementConflicts of Interest - Mediator• FRCM 10.340 (a) Mediator shall not mediate a

matter that presents a clear or undisclosed conflict . . .Conflict arises when any relationship . . . compromises or appears to compromise impartiality

• FRCM 10.340(c) After disclosure, a mediator may serve if all parties agree

• FRCM 10.340 (b) Burden of disclosure…on mediator (ASAP)

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Accepting the EngagementConflicts of Interest - Mediator

• FRCM 10.340 (a) Mediator shall not mediate a matter that presents a clear or undisclosed conflict. . .

• FRCM 10.340(c) . . . if a conflict clearly impairs . . . impartiality the mediator shall withdraw regardless of . . . agreement of parties.

• COMMENT - circumstances . . . cannot be reasonably regarded as allowing impartiality 9

Accepting the EngagementConflicts of Interest - Mediator

Non-Waivable Conflict?

• FRCM 10.310 – Self Determination. Decisions to be made by parties.

• Comment: Critical right to self determination . . . all phases of mediation.

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Statements About Settlement Authority – The Lawyers

• Model Rule 1.2(d) – unethical to assist client in fraudulent act

• Model Rule 3.3(a) – lawyer must disclose material facts to a tribunal

• Model Rule 4.1(a) - unethical to make false statement of fact to a third person

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Statements About Settlement Authority– The Lawyers

• Model Rules 4.1(b) – lawyer must not fail to disclose material fact to third parties (to prevent fraud etc.) unless such disclosure would violate the lawyer’s “confidentiality obligation”.

• Model Rules 1.6 – “Confidentiality obligation” covers everything client discloses to lawyer unless disclosure necessary to prevent “death or substantial bodily harm”.

• Guidelines for Ethical Settlement Negotiations, 3.3.1

A lawyer must comply with the rules of professional conduct …during the course of settlement negotiations . . . and may not …counsel or assist the client in conduct violating … fiduciary duty owed to others. 12

Statements About Settlement Authority – The Lawyers

• Model Rule 4.4 – A lawyer shall not engage in bad faith use of the litigation process.

• Guidelines for Ethical Settlement Negotiations 4.3.1 – An attorney may not employ the settlement process in bad faith.

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Statements About Settlement Authority – The Mediator

• FRCM 10.360 – Confidentiality:(a) Scope. A mediator shall maintain confidentiality of all information revealed during mediation except where disclosure is required by law.

• (b) Caucus. Information obtained during caucus may not be revealed by the mediator to any other mediation participant without the consent of the disclosing party. 14

Statements About Settlement Authority – The Mediator

• FRCM 10.400 - Mediator's Responsibility to the Mediation Process - A mediator is responsible for safeguarding the mediation process. [Mediation] benefits . . . are best achieved if the mediation is conducted in an informed, balanced . . . fashion.

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Statements About Insurance Coverage –The Lawyers

• Hard cheese, Peter – looks like Melody missed it!

• Is insurance coverage a “material fact” requiring Model Rule 4.1(b) disclosure?

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Statements About Insurance Coverage –The Mediator• FRCM 10.360 – Confidentiality:

(a) Scope. A mediator shall maintain confidentiality of all information revealed during mediation exceptwhere disclosure is required by law.


“Substantive Facts” – The Lawyers

• Model Rule 4.1 …a lawyer shall not…(a) make a false statement of material fact…

(b) fail to disclose a material fact (if) necessary to avoid . . . fraud (subject to Rule 1.6 Confidentiality)

• COMMENT: Lawyer required to be truthful when dealing with others on client’s behalf; misrepresentations can occur by partially true but misleading statements or omissions

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• Model Rule 1.6 – (Everything is confidential, but. . .) a lawyer may reveal confidential information (including any misrepresentations by the client) to the extent the lawyer believes it necessary to prevent “reasonably certain death or substantial bodily harm”

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• Model Rule 8.4(c) – A lawyer is prohibited from engaging in conduct involving “dishonesty, fraud, deceit or misrepresentation"

• Model Rule 3.4(a) – A lawyer shall not unlawfully . . . conceal . . . material having . . . evidentiary value

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Guidelines for Settlement Negotiations

4.1.1. – In the course of negotiating…a settlement, a lawyer may not knowingly make a false statement of material fact to a third person.

4.1.2 - In the course of negotiating . . .a settlement, a lawyer must disclose a material fact to a third person when … necessary to avoid … fraudulent act by a client, unless disclosure is prohibited by the ethical duty of confidentiality. 21

“Substantive Facts” – The Mediator

FRCM 10.360 – Confidentiality:

• (a) Scope. A mediator shall maintain confidentiality of all information revealed during mediation except where disclosure is required by law.



• FRCM 10.310. Self-Determination.(c) Misrepresentation Prohibited. A mediator shall not intentionally or knowingly misrepresent any material fact or circumstance in the course of conducting a mediation.

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• FRCM 10.310. Self-Determination.(a) Decision-making. Decisions made during a mediation are to be made by the parties. . . A mediator is responsible for assisting the parties in reaching informed . . .decisions while protecting their right of self-determination.

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• FRCM 10.420 Conduct of Mediation

(b) Adjournment or Termination. A Mediator shall …

(4) terminate a mediation entailing fraud…or unconscionability

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“Negotiating Positions” – The Lawyers

Model Rule 4.1 – A Lawyer … shall not:

• (a) make a false statement of material fact

• (b) fail to disclose a material fact when necessary to avoid …fraud

BUT:

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“Negotiating Positions” – The Lawyers

• Model Rule 4.1 Comment: Under generally accepted conventions in negotiation, certain types of statements ordinarily are not taken as statements of fact. Estimates or price or value . . .and a party’s intentions as to an acceptable settlement of a claim are in this category . . .

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“Negotiating Positions” – The Mediator

• FRCM 10.310(c) Misrepresentation Prohibited. A mediator shall not intentionally or knowingly misrepresent any material fact or circumstance in the course of conducting a mediation.

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“Negotiating Positions” – The Mediator

• QUERY: Does a misstated state of mind regarding “settlement evaluation” or “maximum authority” become a “statement of fact” when the mediator is asked to pass the message?

• QUERY: Is the Mediator misrepresenting a “circumstance,” if not a “material fact,” when delivering the message?

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Legal Advice, Legal Information,and Malpractice – The Mediator• FRCM 10.220. Mediator's Role:

The role of the mediator is to reduce obstacles to communication, assist in the identification of issues and exploration of alternatives, and otherwise facilitate voluntary agreements resolving the dispute. The ultimate decision-making authority, however, rests solely with the parties.

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Legal Advice, Legal Information,and Malpractice – The Mediator• FRCM 10.310. Self-Determination.

(a) Decision-making. Decisions made during a mediation are to be made by the parties. A mediator shall not make substantive decisions for any party. A mediator is responsible for assisting the parties in reaching informed and voluntary decisions while protecting their right of self-determination.

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Legal Advice, Legal Information, and Malpractice – The Mediator• FRCM 10.300. Mediator's Responsibility to the Parties

[A] mediator's responsibility to the parties includes honoring their right of self-determination; acting with impartiality; and avoiding coercion, improper influence…

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Legal Advice, Legal Information, and Malpractice – The Mediator

• FRCM 10.310 Self Determination

(c) Misrepresentation Prohibited. A mediator shall not

intentionally or knowingly misrepresent any material fact or circumstance in the course of conducting a mediation.

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Legal Advice, Legal Information, and Malpractice – The Mediator

• FRCM 10.370(a) Providing Information. Consistent with… impartiality and …self-determination, a mediator may provide information …qualified by training or experience to provide.

• FRCM 10.370(c) Providing Opinions. Consistent with… impartiality and …self-determination, a mediator may point out possible outcomes …discuss merits of claim or defense…A mediator shall not…(opine) how the court will rule 34

Legal Advice, Legal Information,and Malpractice – The Mediator

• FRCM 10.370 COMMENT

The primary role of the mediator is to facilitate …opportunity to resolve … dispute by agreement if (parties) choose to do so. A mediator may assist in that endeavor by providing relevant information. . . A mediator may also raise issues and discuss strengths and weaknesses of positions underlying the dispute.

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Legal Advice, Legal Information,and Malpractice – The Mediator• Rule 10.310 COMMENT

Mediation styles and techniques … may vary …a line is crossed and ethical standards are violated when any conduct of the mediator serves to compromise the parties’ basic right to agree or not to agree.

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Settlements – The Mediator• FRCM 10.420 Conduct of Mediation

(b) Adjournment or Termination. A Mediator shall

(3) adjourn or terminate if mediator believes … any party is unable … to participate meaningfully in process

(4) terminate a mediation entailing … absence of bargaining ability

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Settlements – The Lawyers• Model Rule 5.6(b);

Lawyers are expressly prohibited from offering or making a settlement agreement that includes a restriction on a lawyer’s right to practice law.

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Settlements – The Lawyers• Guidelines to Ethical Settlement Negotiations, 4.2.1

A lawyer may not propose, negotiate, or agree upon a provision of a settlement agreement that precludes one party’s lawyer from representing clients in future litigation against another party.

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Settlements – The Lawyers• Legal Restrictions On Confidential Settlement Agreements

• Issues of “Public Policy”• Public health and well being

• Safety

• Product Defect Cases

• Medical Malpractice Cases

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The Right Way to do the Right ThingConclusion

• Ask the right questions

• Triangulate your ethical position

• Steer clear of trouble; avoid the shoals with creative alternative pathways

• What would Mom want you to do . . .? 41

“The Right

Way to Do the

Right Thing”

Florida Bar

Course #

1406439N

1.5 CLE Credits

General/Ethics

Daytona Beach Maitland/Orlando Jacksonville Miami Fort Lauderdale/Plantation West Palm Beach

Upchurch Watson White & Max Mediation Groupuww-adr.com

Please email [email protected] with questions about course number, Webinar recording, etc.

Please contact Bob at

[email protected] with

questions or comments

regarding content.

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