Monthly Archives: July 2011

Shaping E-Discovery within Arbitration

Posted on by Chris Poole

JAMS Atlanta neutral Al Pearson recently wrote an article for the American Lawyer Media publication, The Fulton County Daily Report in which he identified how parties can take pre-emptive steps to control electronically stored information (ESI) discovery within the arbitration process.

The pre-emptive steps cover a wide range of factors including: the need to periodically review a client’s arbitration clauses due to frequent changes in technology and law related to e-discovery; the importance of a client maintaining an accurate inventory of all equipment or devices on which ESI might be stored; making sure a client understands their own document retention policy and program for scrubbing metadata embedded in electronically generated documents; and, the importance of a client having a set procedure for preserving ESI if litigation is anticipated.

Mr. Pearson goes into detail on all of the above items in his piece.  He also points out how, before the proceeding begins, the lawyers for the parties should carefully examine the arbitration clause that will govern the arbitration since parties are not constrained by the rigidity of litigation (e.g., rules of evidence, complex jury instructions and jury verdict forms).  Mr. Pearson writes: “By choosing arbitration, the parties to a transaction have the opportunity to shape the procedural framework that will govern the resolution of a dispute.”  He continues, “The parties are free to resolve procedural ambiguities or inadequacies in the arbitration clause as they see fit.”

The ability for parties to shape the procedures of arbitration is an opportunity that should be taken advantage of as it can often lead to cost efficiencies.  JAMS has worked to become a thought leader in this area by drafting its own Optional Expedited Arbitration Procedures. The Procedures include limitations on depositions and document discovery requests and Rule 16.2(c) specifically limits e-discovery.

Controlling e-discovery within arbitration is a challenge, but Mr. Pearson reminds us that lawyers can work with their clients to reduce the overall negative impact it can have on the process.  At JAMS, we’re doing our part as well to provide attorneys with tools they can implement to control an arbitration before it begins.

ADR Should Be Part of Dialogue to Address Cuts to Court Budgets

Posted on by Chris Poole

It is not exactly news that the country’s state legislators, strapped for cash, have had to make some unpalatable cuts in order to balance budgets. And, those budget casualties have included state courts. What is perhaps only now just rising to the attention of the public, however, is the ripple effect of those cuts on court dockets and the administration of swift justice across the U.S. And those that administer justice are raising significant alarm.

The chief justice of the California Supreme Court, Tani Cantil-Sakauye was recently interviewed regarding pending cuts to the California judiciary. She called them “devastating and crippling” and a “blow against justice.” Similar cries of alarm have been issued by judges and lawyers of all stripes around the country. All agree that cuts to the judiciary will only serve to lengthen dockets and impede justice for both criminal and civil matters.

While all these voices have pointed out the devastating impact these cuts will have on the judiciary, few have offered solutions, other than restoring budgets. In today’s world, however, where funds are tight for every level of government, this does not seem a realistic proposition any time soon. The courts, as any public institution, seem destined, rightly or wrongly, to have to make do with less.

The ADR community needs a healthy court system.  The symbiosis between the courts and ADR providers is critical.  Multi-year backlogs for civil cases hurt everyone.  But the ADR community should be part of the dialogue regarding coping with these cuts. Budgets are not going to bounce back up, and dockets are not going to shrink.

The ADR community has long been at the forefront of doing more with less. Mediation and arbitration provide practical alternatives to lengthy and expensive court battles. Until now, they were options chosen by litigants seeking a more efficient and equitable end to disputes. But in the context of today’s funding cuts, we in ADR can provide significant relief to clogged courts and overworked judges. Often ADR practitioners serve as discovery referees or special masters to help with evidence, discovery or to streamline some of the court processes. Additionally mediators or arbitrators will rule on components of larger, more complex cases, again to help speed up the proceedings.

ADR is not the complete answer, and it would be wrong-headed and self-serving to suggest that. But, our community’s talented and experienced practitioners are adept at finding cost-effective solutions. This is where ADR’s strength lies and we owe it to the judicial system to be part of the dialogue around solutions. It is our duty as legal practitioners to do what we can in service of the system. We don’t propose to replace the court system, but we do offer a way to lessen the burden on the civil courts. The swift administration of justice is at stake.

Mediation Programs Seek to Aid Homeowners Facing Foreclosures

Posted on by Chris Poole

In the wake of the housing crisis and the economic downturn, one of the biggest consequences has been homeowner foreclosures and loss of homes. The U.S. Senate Judiciary Committee voted in March in favor of a bill to give bankruptcy courts nationwide the authority to set up foreclosure mediation programs.

The goal of the law is to help homeowners find relief through either a loan modification if they qualify or assistance with finding an alternative to foreclosure. The law gives homeowners a new opportunity to meet with the lender and an independent party to ensure that alternatives to foreclosure have been considered and evaluated. Foreclosure mediation under this new law is designed to help foster a dialogue between homeowners and lenders to make sure a fair assessment is made and the homeowner is offered any and all options. Some organizations have opposed the mediation programs, saying it only delays the foreclosure process and prevents a true economic recovery.

To further understand how the programs work and what’s available in certain states, following is a list of programs offered across the country:

  • Connecticut: Legislation would extend the state’s foreclosure mediation program through 2014 and require mediation to be completed before foreclosure litigation can proceed.
  • Delaware: Legislation was introduced that would provide for automatic mediation for homeowners facing foreclosure, instead of the voluntary mediation currently in place.
  • D.C.: The District adopted foreclosure mediation legislation in November 2010 and then barred residential foreclosures until promulgation of mediation-related rules, which were published in April.  Lenders must give borrowers notice of default which includes a mediation election form.  If borrowers decide to mediate they must pay a $50 fee and mediation must be completed within 90 days.
  • Indiana: The state Supreme Court launched a secure online network for exchanging necessary financial documents and information in order to make foreclosure mediation more effective.  A pilot project using the system has begun in two counties.
  • Hawaii: Three alternative foreclosure reform bills are near enactment, although settling on one bill could be challenging.  Two of the three bills include mediation.  As of now, mortgage industry representatives have raised objections to the bills, and especially to the dispute resolution provision.
  • Illinois: New home foreclosure mediation programs are beginning in the counties of Peoria and Madison.  While homeowners in Madison County must submit a mediation request and meet certain financial pre-conditions, in Peoria County the mediation period is mandatory for residential foreclosures.  The mediation program in Peoria begins June 1 and is financed with increased filing fees.
  • Washington: The state enacted H.B. 1362 to provide more time and counseling for indebted homeowners, and mediation with lenders prior to foreclosure.  A housing counselor or lawyer can refer a homeowner to mediation, in which a mediator is to make sure both parties are acting in good faith.  Washington is the third non-judicial foreclosure state to enact a mediation process, following Nevada and Maryland.  H.B. 1362 takes effect in July.

Other programs are also in affect in California, Florida, Nevada and other states.

It is encouraging that there are so many programs available where people can utilize a tool as effective as mediation. Some reports have shown that the mediation programs have been effective at saving people money and their homes. However, considering many programs are still new and experiencing growing pains, not all states have shared in the same success.

European Union Mediation Directive Aims to Improve Access to ADR

Posted on by Chris Poole

Mediation has long been a common way of resolving disputes.  In fact, many sources trace the use of mediation to at least 500 BC.  Whether through the courts or conducted by a tribal elder, mediation has been an effective tool for centuries.  Today, the use of mediation as an extension of the legal system continues to grow.  The vast majority of civil cases in the United States are resolved in this way, and now the practice is gaining new momentum throughout the world.

The European Union enacted its Directive on Mediation in May 2008 to “simplify and improve access to justice.”  While directed primarily at cross-border disputes, it encourages all 27 member states (excluding Denmark, which opted out) to adopt laws and regulations to comply with the directive prior to full implementation in May 2011. The theory is that parties should have access to the same methods of resolving disputes wherever disputes arise in the EU.

Although the implementation of the Directive has been uneven, some states have taken a relatively aggressive stance.  In Italy, the new law requires mediation by an accredited provider before a lawsuit can be filed in about 60 percent of civil and commercial disputes. In other countries including the United Kingdom, Sweden and the Netherlands, mediation remains voluntary but is already an accepted part of the legal process and local laws were already in compliance with the EU Directive.

Although established organizations offering mediation services have existed in the EU for some time, there will undoubtedly be an increase in cases and providers over the next several years to handle both cross border and domestic mediations.  Similarly, the need for more trained and experienced mediators will grow.  In some countries, including the United Kingdom, mediation in domestic cases is already well established.  But inall cases, the conduct and enforcement of mediation agreements in cross-border cases will be greatly enhanced as a common framework is implemented throughout the EU.

The demand for mediation in civil and commercial disputes will be further increased by offering a fast and inexpensive alternative to the long backlogs in many European court systems. With the backlog of cases in some EU countries in the thousands – or as in Italy, almost 6 million – the expediency of mediation is an attractive alternative.

The various implementations of the EU Directive smooth the way for more mediation by ensuring confidentiality for parties and mediators, providing for the enforceability of mediation agreements, and allowing access to the courts in the event that mediation does not result in a settlement.  In most cases, the new laws and regulations also allow or even encourage courts to refer cases to mediation if an attempt at resolution has not been made.

To be sure, the emphasis on the EU Directive and corresponding laws being rolled out in member countries is concentrated on cross-border disputes more than domestic disputes.  This adds a layer of complexity for ADR practitioners in the EU who may not be familiar with the laws and customs of multiple countries.  ADR provider organizations that can build competent panels of mediators from multiple countries will have a definite advantage.Forthe sake of full disclosure, we recently launched JAMS International with headquarters in London. The group was formed in partnership with JAMS in the United States and ADR Center in Italy and also includes Result ADR in the Netherlands.  We are adding panelists from additional EU countries as well.

Since the 1970’s, mediation has been an integral part of the legal system in the United States and there are now hundreds of thousands of such cases year.  The UK is not far behind in terms of the maturity of mediation and ADR in general.  Time will tell, but count on the ADR market in Europe and elsewhere to blossom in the coming years.