Inside Track: Court Approved: Family Law Mediators Can Draft Settlement Documents:

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  • Court Approved: Family Law Mediators Can Draft Settlement Documents

    The new rule, with an expected effective date of July 1, 2017, will allow lawyers who mediate family law cases to draft, modify, complete, and file settlement documents. The rule will give divorcing couples more affordable options to come to a resolution.

    Joe Forward

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    Jan. 18, 2017 – The Wisconsin Supreme Court has approved a petition that will allow lawyer-mediators to draft and file settlement documents in family law cases. Currently, parties must obtain different legal counsel to perform those legal tasks after mediation.

    More frequently, parties attempt to navigate the legal system with no legal help at all. Another layer to limited-scope representation rules that took effect two years ago, the new rule will give parties a more affordable solution to resolve family law disputes.

    The Director of State Courts filed petition 16-04 on the recommendation of the Wisconsin Supreme Court’s Planning and Policy Advisory Committee (PPAC).

    After a public hearing on the petition last week, a 6-1 majority approved the petition as presented. Justice Shirley Abrahamson did not oppose the petition but did not join the majority. She had moved, unsuccessfully, for amendments to clarify minor points that will likely be addressed in a separate writing on the final order.

    The new rule will particularly impact cases involving divorces. The expected effective date of the new rule is July 1, 2017, but the court has not yet issued a final order.

    Problems with Current Rule

    A supporting memo to the petition noted that divorcing couples increasingly navigate the judicial system on their own, whether by choice or necessity. Some can’t afford lawyers.

    Joe Forwardorg jforward wisbar Joe Forward, Saint Louis Univ. School of Law 2010, is a legal writer for the State Bar of Wisconsin, Madison. He can be reached by org jforward wisbar email or by phone at (608) 250-6161.

    Others may not see the value in hiring one. An estimated 70 percent of family law cases involve self-represented parties, and 95 percent of those are settled without trial.

    Mediations can assist in the settlement of family law disputes without expensive litigation. But because divorce settlements involve the preparation and submission of legal documents, the process after mediation can be problematic for pro se litigants.

    “Although the resolution of divorce and other family issues through mediation is a desirable trend, it can result in problems when neither of the parties has hired a lawyer. In a family case, it is not sufficient that parties reach agreement,” the memo notes.

    Financial disclosure statements, marital settlement agreements, findings of fact, conclusions of law, judgments, and ancillary implementation documents (title transfer documents, beneficiary designations, instructions to child support agencies, and qualified domestic relations orders) must also be prepared and submitted to the court.

    The Rules of Professional Conduct for Lawyers are viewed as prohibiting lawyer-mediators from drafting these legal documents for parties to a mediation, other than a memorandum of understanding, because lawyers are not allowed to “represent” a party to a mediation the lawyer conducted. “Represent” includes drafting legal documents.

    “The result of this is that many litigants are deprived of the best source of legal expertise (short of independent legal representation) and family courts are increasingly faced with parties who come before them unequipped to effectively complete the divorce process they have begun,” the memo states. “This includes parties who may have a mediation memorandum which is not legally sufficient or lack any of the additional legal documents needed. This results in delays and issues for the parties and the courts and also creates a real risk of ineffective judgments and post-judgment conflict.”

    The proposal called for an amendment, under Supreme Court Rule 20:2.4 (lawyer serving as third-party neutral) that expressly permits the lawyer who acts as a mediator in family law cases to draft settlement documents while continuing to act as mediator.

    Specifically, under the adopted petition, lawyers that mediate actions affecting the family under Wis. Stat. Chapter 767 may draft, select, complete, modify, and file documents that confirm, memorialize, or implement the resolution of issues being mediated.

    Drafting is only permitted if both participants give their informed consent. Informed consent requires the lawyer to disclose to each party “any interest or relationship that is likely to affect the lawyer’s impartiality in the case or to create an appearance of partiality or bias and that the lawyer explain all of the following to each of the parties:

    • The limits of the lawyer’s role;

    • That the lawyer does not represent either party to the mediation;

    • That the lawyer cannot give legal advice or advocate on behalf of either party to the mediation; and

    • The desirability of seeking independent legal advice before executing any documents prepared by the lawyer-mediator.”

    The rule will note that drafting, selecting, completing, or modifying documents as a mediator “does not create a lawyer-client relationship between the lawyer and the party.” Mediators still cannot appear in court on behalf of either or both parties.

    Wide Support

    The State Bar of Wisconsin’s Board of Governors voted to support the petition in September 2016. The State Bar’s Family Law Section and the Professional Ethics Committee also support it, as does the Wisconsin Family Court Commissioners Association, and the family division of the Milwaukee County Circuit Court.

    “The simple truth is that the overwhelming majority of people involved in family court cases do not hire lawyers. In family law cases involving children, achieving a voluntary settlement is especially valuable to the parties,” judges for the family division wrote in a letter to the justices.

    But an agreement must be reduced to writing in the form of a marital settlement agreement, the judges noted, and other documents must be submitted to the court.

    “The proposed amendment will provide family law litigants with access to the help of lawyer-mediators practicing within the code of ethics, who after assisting the parties to reach agreement freely, knowingly and fairly, could assist them in efficiently and properly completing the family court process,” the judges explained.

    The court received numerous letters from practitioners who also supported the proposal. Kent Tess-Mattner, who has practiced law for more than 36 years, noted that documents prepared by mediators are preferable to those that parties “cobble together from the internet.”

    He noted that lawyer-mediators, under the code of ethics, are still required to inform the parties of the benefits of seeking independent counsel. “We family law practitioners sometimes spend substantial time trying to interpret and unravel poorly drafted settlement documents crafted by lay people, often at greater expense to the parties than they would have spent having advocate counsel in the first place,” wrote Tess-Mattner.

    Currently, even if the parties have reached an agreement through a lawyer-mediator, the mediator typically advises the parties to retain different counsel to become familiar with the case, draft the settlement agreement, and submit it to the court.

    “This process can take weeks, at which time the agreement reached at mediation can fall apart. This is not to the benefit of the parties or the courts,” Tess-Mattner wrote.

    Paul Stenzel, a private practitioner and a part-time deputy family court commissioner in Racine County, said, “The current state of affairs penalizes rule followers.”

    In Wisconsin, a law license is not required to conduct mediations, the unauthorized practice of law is difficult to enforce, and some lawyers may disregard the current rule.

    “The challenges of enforcing the existing rule against drafting mean that some lawyers do so anyway with impunity; the same applies to non-lawyer mediators,” Stenzel wrote in a letter to the court. “The proposed rule change will normalize the field and let rule followers behave accordingly.” He also said the rule will ease burdens on the courts, and create more opportunities for lawyers to innovate in providing legal services.

    Two professors at Marquette University Law School said divorcing couples with modest means may find the aspect of hiring two attorneys too burdensome financially “but may find the services of a lawyer-mediator to be a more palatable expense.”

    “The courts will benefit by receiving documents completed by those with experience and understanding of the actual requirements, enhancing efficiency and reducing the need for post-judgment proceedings,” wrote professors Natalie Fleury and Andrea Schneider.

    Opponents

    Not everyone supported the petition. Mark Borns, a divorce lawyer in Madison, said settlement documents drafted by mediators “are one of my pet peeves.”

    “They are the source of considerable post-judgment confusion, unworkable and ambiguous clauses, and misapplications of the law,” he explained. “I also believe that non-lawyer mediators should be regulated. I do not believe that a lawyer can consistently draft a mediated agreement in an ethical fashion and remain a true neutral.”

    Borns, who has practiced law for more than 30 years, said he always insists that both parties have legal counsel during the mediation, and he is frequently called upon to unravel the tangles of a settlement agreement drafted pro se or by a mediator.

    He provided numerous examples of problems that arose when the parties proceeded without the benefit of independent counsel to adequately explain the pitfalls of a settlement agreement, and said lawyer-mediators simply cannot remain neutral.

    “When one party is agreeing to something favorable to the other, and that agreement will clearly present future problems or is grossly unfair, how does the mediator intervene? If that mediator was an attorney for one side and did not counsel his or her client about the pitfalls of the agreement, it would constitute ineffective assistance of counsel,” he wrote.

    Rocky County Circuit Court Judge Michael Fitzpatrick also opposed the petition. He voiced concern that citizens will not understand the distinction between an advocate and a mediator and be confused by the legal services and duties that apply.

    “Creating this new type of relationship between someone with a law license and the public – which is neither fish nor fowl – will inevitably lead to misunderstandings and confusion among the public as to the services which will be delivered, the duties of this person, and whether he or she will be protecting the interests of the Wisconsin citizens who retain this attorney/mediator,” Judge Fitzpatrick wrote.

    He also noted another potential problem: unscrupulous attorneys. “Regardless of the fact that certain statements should be in writing, I believe this opens up another avenue for less than scrupulous attorneys to quietly take advantage of persons by telling the parties that the attorney/mediator will be acting as their attorney and they only have to spend money on him/her to have their divorce done,” Judge Fitzpatrick noted.

    Two attorneys, Lisa Derr and Cassel Villarreal, directly responded to Judge Fitzpatrick’s concerns. They said potential clients were confused about the distinction 20 years ago, but they have found that most people now understand the distinction.

    “Regardless of their demonstrated initial knowledge, the requirement of informed consent protects those not so informed,” the Beaver Dam attorneys wrote.