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Supreme Court Amends Mediation Rule

January 01, 1997-On March 5, 1997, the Michigan Supreme Court issued a number of significant amendments to MCR 2.403, the court rule providing for mediation of civil actions. "Michigan Mediation" is a unique procedure whereby cases are submitted to a panel of three disinterested trial lawyers, written and oral statements are made by counsel, and the panel issues an evaluation as to the settlement value of the case. The parties can either accept or reject the evaluation. Unless all parties accept, the case proceeds to trial. If a party rejects the evaluation and does not better his or her position at trial, that party becomes liable for costs and actual attorney fees (known as mediation sanctions) from the date of the mediation forward.

The Supreme Court amendments are effective October 1, 1997. Set forth below is a summary of the major amendments.

1) Mediation in tort cases (previously mandatory in all cases) is now only mandatory in Circuit Court and optional in District Court.

2) MCR 2.403(D)(4) - the special rule for mediation of medical malpractice cases (providing, among other things, for a five person mediation panel with two medical professionals as members) has been REPEALED.

3) The fine for late mediation summaries or late Proof of Service of summaries has been raised to $150, which still cannot be charged to the client, unless the client agrees to the charge in writing.

4) An insured party must disclose policy limits if requested, and details of settlement NEGOTIATIONS (previously privileged) must now be disclosed if the panel asks.

5) Counsel are forbidden to engage in ex parte communications with the mediators, and the mediators are allowed to refrain from discussing the matter with counsel after the evaluation.

6) One amendment clarifies a matter on which the Courts have been split. Even though there may be separate evaluations as to multiple claims or counterclaims, each party must accept or reject the NET RESULT as to any other party.

7) Under the old rule, if all parties accept, a party could insist on a judgment in the amount of the award. The amendment provides that if the amount is paid within 28 days, the payor may insist upon a DISMISSAL with prejudice rather than being subject to a judgment.

8) The new rule provides for judicial review of a mediation panel's determination that a claim or defense is frivolous (thus subjecting the frivolous party to the requirement of posting a bond). This conforms the rule to court decisions.

9) Sanctions previously were applicable in a case where the case was resolved by a dispositive motion filed after mediation. Sanctions are now applicable if the dispositive motion is DECIDED after mediation. HOWEVER, in cases decided by motion, mediation sanctions are not mandatory, and the Court may refuse to allow them in the interests of justice.

10) The adjusted verdict (for computation of sanctions) must now be further adjusted in situations involving future damages (see MCL 600.6306).

11) A new rule (MCR 2.404) has been promulgated. It deals in detail with selection of mediators, assignment to panels, qualifications of mediators and removal of mediators.

12) MCR 2.405 (Offers of Judgment) has also been amended. Previously sanctions were not available under that rule in situations where the case was resolved by a dispositive motion. That has been changed, and now that rule is identical to the mediation rule on that point.

13) Presently MCR 2.405 does not allow an offeree who has not made a counteroffer to recover sanctions. Under the amendment, such an offeree may recover sanctions, but only if the Offer is made less than 42 days before trial.

14) No sanctions are applicable under MCR 2.405 if the case has been submitted to mediation, unless the mediation evaluation was NOT unanimous. This is a major change, as previously the imposition of sanctions was governed by the rule (2.403 or 2.405) covering the procedure employed latest in time.

These amendments must be read in conjunction with earlier court reform measures adopted by the Supreme Court in January, 1997. For example, prior to this year, cases in which the mediation evaluation was less than $10,000 were routinely remanded to an appropriate district court for further proceedings and trial. The January amendments eliminate this remand procedure (previously governed by MCR 4.003). The current amendments to MCR 2.403 conform that rule to this change in procedure. Presumably remand was eliminated in conjunction with the increase in the jurisdictional limit of the district courts to $25,000.

This article was authored by Timothy D. Wittlinger.


(Mr. Wittlinger was appointed by the Chief Justice to serve on a special committee to review MCR 2.403 (the Michigan Mediation Rule) and to recommend amendments to the Michigan Supreme Court. He is also a member of the Oakland County Bar Association Mediation Committee and lectures semi-annually on Mediation procedure for the Federal Bar Association New Lawyer Seminar.)