SAVING YOUR CLIENTS AND YOU MONEY
THROUGH MEDIATION AND ARBITRATION
Let me make two assumptions: first, let me assume that you have
an active family law practice where (1) all of your many clients have
been fully and completely satisfied with your professional services,
(2) they have paid you, to date, every single dollar of the fees and
costs you’ve charged them, without questions or concerns, and (3)
you have absolutely no doubt that as your case ultimately goes to trial,
and is possibly appealed, your clients will continue to be pleased with
you and will pay your fees and costs in full, no matter the amount.
If this assumption is correct, don’t waste your time reading any
further. Have a nice day.
For the second assumption, let me assume that everything stated above
is the complete opposite.
Before I go any further, and to avoid any claim of absolute plagiarism,
I want to give attribution to Jim McLaren, Esq., of Columbia, for making
an excellent presentation on this very subject at the December, 2008
Family Law Bench/Bar CLE.
I recently sent out an e-mail wondering why there is apparent resistance
among South Carolina family law attorneys to engage in some form of arbitration
(and, arguably, mediation). Some responses were cordial, some were
pretty blunt, but they all came to the same conclusion: “MONEY”. They
said mediation and arbitration are too expensive and clients cannot afford
it…or, the “amount of money involved in the case” doesn’t
warrant mediation or arbitration. They related miserable experiences
they had encountered with the appointed mediator.
Let’s look at what you perceive to be the “problem”,
and let me just encourage that you try to see the potential of mediation
and arbitration as offering your clients and YOU an opportunity, not
an obstacle.
First of all, always remember that inside a family courtroom you always
should at least have a 50/50 chance of being successful for your clients.
And compare those odds with you always having a 100% chance of having
a successful outcome for your client in a carefully planned and well-conducted
mediation (I realize I’m discussing with you “mediation” and
not “arbitration”…the arbitration discussion will
come later).
With that said, all family law attorneys in this State have requirements,
options, and considerations which are in play in dealing with the issue
of mediation/arbitration costs. If you already know what they are,
then quit reading, and have a nice day.
Requirements:
- In the court-annexed ADR Rules affecting those counties who are under
mandatory family court ADR, Rule 4(d)(1) requires that “if there
are unresolved issues of custody or visitation…the court shall
appoint a mediator at a temporary hearing. If there is no temporary hearing,
then the parties shall agree upon a mediator or notify the court for
the appointment of a mediator within fifteen (15) days of the joinder
of the issues of custody or visitation…”. If those
issues (custody or visitation) are in play, you have no choice but to
mediate those issues. Now, how could you get around it? One
way is to hope the family court judge conducting your temporary hearing
doesn’t know that Rule, and you choose not to bring it to his or
her attention. Another way is that neither the attorneys nor the
judge involved in your temporary hearing are aware of this Rule, or,
if they are aware of it, they all choose to ignore it or, at least, not
be bound by it. There are several other, more preferred, alternatives
which I’ve listed under “Options”, below.
- Under ADR Rule 4(d)(2), if there are issues other than custody or
visitation, you are required to mediate those issues prior to scheduling
your “hearing
on the merits” (“…The court shall not schedule a hearing
on the merits until a Proof of ADR has been filed.”)
- Under ADR Rule 4(d)(4), the initial mediation conference must occur
within 30 days of the mediator’s appointment or selection.
- Pursuant to South Carolina Code Ann. §63-3-530(39), any family
court judge in any county, not just the ADR-mandated counties, has
the jurisdiction to order that parties engage in mediation.
Options:
- Under ADR Rule 5(e), you can
always file a motion (or include such a motion along with your motion
for temporary relief), requesting that your chief administrative
judge exempt your case from any mediation requirements. The
Rule lists, as case-specific reasons for exemption, “incarceration
or mental or physical condition”, but you can list whatever you
believe might work (e.g., your client has moved to another state, you
have raised issues of domestic violence making it dangerous for your
client to be in the same room or vicinity of the spouse, etc.).
- Under ADR Rule 9(b), if the
judge orders mediation (as opposed to the attorneys consenting to
it), the court order can set the mediation fees at $175 per hour
(in fact, the order can include the specific language from this Rule). (Note:
the ADR Rules anticipate that the mediation fees will be split equally
between or among the parties.)
- If your client believes he or
she qualifies for “indigency status”,
then under ADR Rule 9(d), he or she (through you) may make a motion before
your chief administrative judge to be exempted from the payment of any
mediation fees. However, there is only a 10-day window “after
the ADR conference has been concluded” within which your client
must file an indigency request. Arguably, you should at least
make that request before or at the time your case is sent by the judge
to mediation.
- If your case is mediated, without
success, and you believe the other party violated “any provision of the ADR Rules without good cause”,
then pursuant to ADR Rule 10(b), you can request that the court award
your client his/her mediation fees.
Considerations:
- With all due respect, if at any time you make
the statement – or
take a broad position – that “my client cannot afford the
mediation fees”, then you have put all of the following very
quickly into motion:
- Short of fully settling your case, you have
eliminated and closed the door, outright, of giving your client even
the opportunity of getting an early resolution of his or her case. To protect yourself, it
might be a good idea to have your clients sign some brief acknowledgement
that you have fully explained the “mediation requirements” to
them, and that they have knowingly elected to forego any efforts to
mediate their case.
- You have most probably extended the time when
your client’s case
will get into court for trial by 9 – 18 months, depending upon
the county in which the case is filed. This may not matter to
a patient client involved in a divorce or custody dispute.
- As Jim McLaren so clearly and cogently stated,
the time you invest in preparing your client’s case for trial and trying the case, at
your hourly rate, will most probably be substantially more than the total
of all the mediation fees which may have been incurred in your case (remember:
unless otherwise agreed by the parties, under the ADR Rules your client
is responsible for only one-half of the mediation fees…conversely,
your client is responsible for 100% of your fees…think about that
for a moment). Also, consider the additional time you will spend
in meeting with witnesses, engaging in discovery, taking depositions,
issuing any subpoena…and on and on. If you have a client
who can easily pay you for all of your time, your paralegal’s time,
your advanced litigation costs, etc., then terrific…good luck
at trial. I hope your trial judge awards you substantial attorney’s
fees and all of your litigation costs…and, also, good luck with
any appeal.
As you of course know, all of this is just food for
thought…nothing
more, nothing less.
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