New Mediation Law in UK Geared to Divorcing Couples

By Richard Birke

Richard Birke

Richard Birke

Despite the efforts of a group of 6,500 mediators and millions of pounds spent by the government on advertising and diversion efforts, divorce mediation languished in Great Britain.  The London Times reported that “only half of 4,000 adults surveyed would even consider an out-of-court solution to resolving their disputes.” [emphasis added]

A new law will require that divorcing couples with disputes about children or property will be required to attend a “mediation information and assessment meeting.”  The couples aren’t required to mediate, but merely to consider mediation.   There, they will be informed that the average mediated case in England costs 500 pounds and takes 110 days to resolve and that the averaged litigated case costs 4000 pounds and takes 435 days.   Presumably, they’ll also learn about how mediation works.   Surely, some couples will mediate who would not have without this nudge.

These small changes to the court’s approach to family law may be a harbinger of things to come.  It was certainly the case in the U.S.  that the earliest and most enthusiastic adopters of mediation in the U.S. were the lawyers and judges who worked in family law courts.   They successfully lobbied to have mandatory mediation programs in most all counties in the U.S. It wasn’t long after their success that the idea that mediation was a superior way to resolve many disputes penetrated deeply into the legal culture – into courts rules, laws, and the minds of lawyers and clients.

Lest this seem like news that the Brits don’t mediate, there’s evidence to the contrary.  Mediator friends in the U.K. report that business is brisk and that practicing lawyers understand the value of self-determination over the outcome of a dispute and a dedicated and skilled neutral.  I am always pleased to hear about mediation working well and I hope their practices continue to thrive.

But it seems that there’s still massive growth potential and it may be on the horizon.  Where the family courts go, so goes the dispute resolution culture.  After the divorcing couples have good experiences in a mediation they would not otherwise have considered (and a great many will have good experiences – that’s part of the magic of mediation), these same divorcees will go back to work running and working in companies that may have disputes – disputes that they would not have previously considered appropriate for mediation.

Family Justice Minister Simon Hughes summed it up perfectly when he said “Mediation works and we are committed to making sure that more people make use of it, rather than go through the confrontational and stressful experience of going to court.”  Let’s hope that divorcing couples have a superior experience than court and that Minister Hughes’ commitment translates into a cultural cascade in favor of increased employment of mediation.

A World in Balance- At Least in Terms of the Number of Arbitration Courts

By Richard Birke

Richard Birke

Richard Birke

In the past few weeks, Russia has abolished its main commercial court and Singapore has announced its plan to open one.  The events appear to be unrelated, but it seems likely that the ripples from each may reach the other.

On November 28, the Financial Times printed a headline that read “Moscow Abolishes Commercial Court.”  The paper reported that the “Federal Council, the upper house of parliament, yesterday changed the constitution to allow the merger of the Supreme Court of Arbitration into the Supreme Court.”  The move was not uncontroversial with a reported “80 law firms oppos[ing] the changes in an open letter.”  The letter was directed towards fears of politically-motivated reprisals at businesspeople like Mikhail Khodorkovsky, a jailed “business magnate turned politician” (who, incidentally was recently pardoned by President Vladimir Putin  – according to CNN).

Meanwhile, on December 3, Agence France-Presse reported that “Singapore to Open New Commercial Court to Leverage Arbitration Strengths.”  The Singaporean government has recognized that the economies of Southeast Asia are booming, with GDP for the region likely to triple by 2020.  Certainly, the volume of disputes and the need for prompt resolution will see commensurate growth.  And Singapore is already strong in this field.  The December 3 story reports that “The Singapore International Arbitration Centre, set up in 1991, last year handled 235 disputes worth US$2.87 billion….It is considered the fourth most preferred arbitration institution in the world, after similar bodies in Paris, London and New York, according to a survey by international law firm White & Case.”  You can read the whole report at http://www.scmp.com/news/asia/article/1372280/singapore-open-new-commercial-court-leverage-arbitration-strengths

Surely trade between Russia and Asia will rise as Asia’s economy continues to grow and given the proximity of Russia’s natural resources and Asia’s need for them. Will some Russian business disputes end up in Singaporean arbitration?   Only time will tell, but it would be no surprise if the closing of one arbitration court will result in new business for the one that’s opening or another someplace else.

Books I’ve Loved (Which Can Be Applied to Your Practice)

Richard Birke

Richard Birke

By Richard Birke

With daylight savings upon us, we’re now back in the dark season, or as I prefer to think of it, the season of reading. Those of you who have read my book reviews and followed my work know that I am a big fan of psychology and neuroscience. After all, if you want to know how to negotiate better, you need to understand how to make better decisions and what’s going on for the decision-makers across the table.

Against the Gods

Against the Gods

In that vein, I highly recommend Peter L. Bernstein’s Against the Gods – subtitled, the Remarkable Story of Risk. Bernstein brings journalistic gifts to bear when he teaches us how Daniel Bernoulli discovered that we bet more when we are losing, how Amos Tversky and Daniel Kahneman advanced that study into a Nobel Prize winning theory of loss aversion, how former decision theorist-turned Pentagon Papers-author, Daniel Ellsberg, taught us why we prefer known risks to uncertain ones and more. It’s a must read for anyone trying to value a case or claim, whether working with or against anyone’s deity.

The Accidental Mind

The Accidental Mind

Another great book is David Linden’s The Accidental Mind. This book is a neuroscientist’s explanation for everything from love to religion to dreams and more. The first half of the book is a primer on the brain and the second half goes into applications. Doctor Linden revived my interest in science by writing an entertaining and educational work that helped me understand the automatic processes of the mind and how they shape our perspective on our wants and desires. Nothing accidental about this recommendation.

Stumbling on Happiness

Stumbling on Happiness

I also love Daniel Gilbert’s Stumbling on Happiness. Gilbert is a Harvard Psychology Professor who has studied why we are so bad at predicting what will make us happy.  He discusses such fun concepts as “experience squishing and expansion” in which a person who couldn’t possibly be as happy as we are (think conjoined twins) must take the range of happiness from 1-10 and expand it into a larger space. The twin must actually experience a true range from 1-7 (Gilbert nor I actually believe that the twin is less happy) and stretch it to make it a 1-10. This book tells us why it’s so hard to reach a durable settlement and why we are so prone to buyer’s remorse. Read it – you’ll be happy you did.

Let me give you more that I think are great – no lengthy explanations– just strong recommendations.

Deepak Malhotra and Max Bazerman – Negotiation Genius (how to negotiate better)

Robert Axelrod – The Evolution of Cooperation (how cooperation can emerge in competitive environments)

Cass Sunstein and Richard Thaler – Nudge (how to get people to do things that are good for them)

David Eagleman – Incognito (how the subconscious mind controls our lives)

Joseph LeDoux – The Emotional Brain (how the brain creates emotion)

Paul Ekman – Emotions Revealed (the art and science of facial recognition)

Marco Iacaboni – Mirroring People (the neuroscience of empathy)

So there’s a nice collection for you – each one entertaining and stimulating at the same time.  If you read one every few weeks, that ought to take you through the darkness and back into the light, in more ways than one.

Happy reading!

 

A Rose by Any Other Name

By Richard Birke

Richard Birke

Richard Birke

Most of the leading law school textbooks explain arbitration by describing a case where a party suffers a loss and there is a dispute between the insurance company and the insured.  The insured typically places a high value on the subject of the loss, while the insurance company places a lower value.  A third party is called in to offer an opinion about the value of the loss and the parties agree to be bound by that third party’s opinion. Sometimes the parties each choose an appraiser and the two appraisers choose a third. While the contract binding the parties may refer to the process as appraisal, courts look past the name and treat the process as if it were arbitration.

For example, in the 1935 case of Fireman’s Insurance Company v. Blount, the Georgia Court of Appeal ruled that arbitration and appraisal could be thought of interchangeably. They wrote, “The purpose of an appraisal and arbitration being to fix the amount of the loss, and this having been done by agreement by the parties here…the award fixed the amount of the loss, and in this case the voluntary agreement fixed the amount of the loss. There is no substantial difference in the two propositions.”  The lesson is that you might call something an appraisal, but if the process has the characteristics of arbitration, a court will treat it as if it were arbitration.

But not always.

Recently in Citizens Prop. Ins. Corp. v. Mango Hill |6 Condo. Ass’n, Inc., the Florida Court of Appeal announced that an appraisal is not an arbitration and the two should not be confused.  In that case, an HOA and its insurer agreed to an appraisal process that was employed to determine the amount of loss associated with a hurricane. The trial court allowed the HOA to submit the appraisal in court as an arbitral award. The Court of Appeal had a different take.  That court found three significant differences between arbitration and appraisal. “First and foremost, while an agreement to arbitrate ordinarily encompasses the disposition of the entire controversy between the parties, an agreement for appraisal extends merely to the resolution of the specific issues of actual cash value and amount of loss. Second, the appraisal process is an informal one. Appraisers generally are expected to act on their own skill and knowledge relating to the matters being appraised. There is no obligation for appraisers to give formal notice of their activities to the parties, counsel or to hear evidence. Finally, all issues other than those contractually assigned to the appraisal panel are reserved for determination in a plenary action.”

In contrast, with respect to arbitration, the Court wrote, ““Arbitrations, on the other hand, are quasi-judicial proceedings. Under the Florida Arbitration Code, each party is entitled to a full hearing in the presence of every other party, unless such right is waived by agreement or conduct. The arbitrators must meet together in each session, and may not engage in independent investigation of the thing in issue. The Arbitration Code guarantees to each party not only the right to notice of each hearing session, but also the right to counsel, the opportunity to present evidence and the right to cross-examine witnesses. Finally, unlike appraisal, the arbitration panel may adjudge the case only on what is presented to them in the course of the proceeding.”

The Court reversed the judgment of the trial court and the case was sent back down for further proceedings.

So it seems that while some courts and some casebooks look past labels to substance, other courts care deeply about the label.  What lesson is there for lawyers and their clients?  Draft your arbitration clauses carefully because language sometimes matters a lot.  A rose by another name may be treated like a daisy, despite its thorns and alluring scent.