Fla. Supreme Court Approves Mediation

Posted by Orb Staff on December 30, 2009 No Comments
Categories : Mortgage Servicing

Florida Supreme Court Chief Justice Peggy A. Quince has issued an administration order implementing aspects of a managed foreclosure mediation model recommended by a court-appointed task force last month.

According to Quince's order, all foreclosure cases in the state involving residential homestead properties will be referred to mediation unless the plaintiff and borrower agree otherwise or unless effective pre-suit meditation that complies with the mediation program requirements has been conducted.

The order requires certified mediators to schedule mediation between 60 days and 120 days after a foreclosure suit is filed. The mediation manager is responsible for contacting borrowers to explain the program and to refer them to foreclosure counselors approved by the U.S. Department of Housing and Urban Development.

Quince made minor tweaks to the task force's recommendations. For example, the task force suggested the creation of a Web-enabled platform for mediators to use in accepting and delivering disclosures.

According to Quince's order, "the Court recognizes that establishment of such a platform may require time and resources that are not presently available in the midst of the current foreclosure crisis. The Court therefore supports and encourages, as an interim solution, the use of a secure dedicated e-mail address by managed mediation providers for the purpose of accepting and exchanging plaintiff and borrower disclosures prior to scheduled mediations."

Quince did agree with the task force's recommendation that lenders shoulder mediation costs.

"Requiring borrowers to pay a portion of mediation up front would operate as a barrier to this Court's goal of efficiently managing these cases to avoid waste of judicial and party resources," Quince wrote.

The model administrative order provides for phased payments, whereby lenders pay part of the cost at the time the complaint is filed and the remainder after the mediation is scheduled. Total mediation fees may not exceed $750.

SOURCE: Florida Supreme Court

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