Proposed legislation calls for 'automatic mediation'

By Lee Dryden
BridgeTower Media Newswires
DETROIT — A state legislative panel recently got a lesson on the merits of alternative dispute resolution through a bill calling for “automatic mediation.”

House Bill 5073 would generally require disputes to be referred to mediation if they are civil nondomestic relations actions in which claimed damages exceed $25,000 or contested probate court proceedings.

Rep. Klint Kesto, who sponsored the bill, told the House Law and Justice Committee on Oct. 24, “Automatic mediation will provide an efficient procedure to achieve early resolution of disputes, avoid costly time-consuming delays associated with litigation, would prevent the backlog of caseload faced by so many of our courts and also allows for opt-outs if the parties actually prefer litigation.”

The bill also states that cases involving abuse or personal protection orders would not be referred to mediation.

Lawmakers heard testimony from prominent ADR practitioners on the efficiency of resolving disputes via mediation.

“The point is that we can come to resolutions rather quickly,” said Kesto, an Oakland County Republican and lawyer who chairs the committee.

Rep. Peter Lucido, a Macomb County Republican who sits on the committee, praised the legislation and said sending cases to mediation early in the process eliminates costly time-consuming discovery.

“I like the idea. The concept is great because it streamlines that which is ultimately going to happen six months down the road by a judge ordering it, or in the alternative, going to case evaluation, where a number is put on it that either party is probably unhappy with after they spent thousands of dollars,” said Lucido, who also is an attorney.

Under the bill, a judge would be required to “refer an action to mediation within 30 days after a response to the complaint is filed, unless an
objection is timely filed,” according to a legislative analysis of the bill by the House Fiscal Agency.

“The mediator would be required to facilitate communication between parties, assisting in reaching agreements including settlement, narrowing of issues, defining discovery parameters, and establishing any deadlines. Additional mediation sessions could be held, if agreed to by all parties,” the analysis stated.

Cases could not be referred to mediation under the legislation if a party is subject to a protection order protecting another party, seeking entry of a protection order against another party or involved in an abuse or neglect proceeding, the analysis stated.

Referrals also would be prohibited if there is an allegation that a party abused another party or a request for investigation of a party with the Department of Health and Human Services.

But the restrictions would not apply if the court determines mediation is appropriate or if “the protected party, party seeking protection, or party who is allegedly the victim of abuse requests mediation,” according to the analysis.

Some reasons listed in the bill for filing an objection to mediation referral include: child abuse or neglect, domestic abuse, inability of one or both parties to negotiate for themselves, inability to afford the mediation fees and costs, and the matter being assigned to another ADR process.

The bill states mediation proceedings would be private, with all communications confidential and privileged.

It also lists circumstances under which communications could be disclosed, such as: the communication is part of the mediator’s report approved under court rules, the disclosure is necessary for a court to resolve disputes about the mediator’s fee, court personnel
reasonably require disclosure to administer and evaluate the mediation program, the communication is a threat to inflict or plan bodily harm or commit a crime, the communication occurs in an action out of which a claim of malpractice arises, and the disclosure is included in a report of professional misconduct, according to the analysis.

Joseph C. Basta, a mediator and arbitrator with Basta Resolutions PLLC in Ann Arbor, spoke to committee members on behalf of the State Bar of Michigan’s 900-member Alternative Dispute Resolution Section, of which he is a former chair.

The bill would allow for mediation to occur very early in the process, which would streamline discovery and enable the parties to hone in on issues and discuss a resolution early in litigation, Basta said.

“We’re supporting this bill because mediation, in our experience as mediators and as trial lawyers, is a faster, cheaper, fairer and more satisfactory method of dispute resolution than the alternatives,” he said.

Most mediations are completed in less than a day in an informal, private, confidential setting that puts the parties in control of finding a resolution that works for them, Basta said.

There is a 75-percent settlement rate for mediation as opposed to about 20 percent for case evaluation, he said.

William L. Weber Jr., executive director of Professional Resolution Experts of Michigan LLC with offices in Detroit, Grand Rapids and Traverse City, said the bill is a step in the right direction.

“The way I always put it is that in mediation, you have win-win situations, and when you go to trial, when you go to just litigate, you got a
winner and a loser. That’s a very big difference,” he said.