Friday, July 22, 2011

Draft Rules Governing ADR Services in the Maryland Courts

Last week I posted a notice that the Maryland Standing Committee on Rules of Practice had published a draft rewrite of Rule 17 and Rule 9 regarding the provision of ADR services to disputants in the Maryland Courts. A link to both a clean copy of the proposed rules and a red-lined copy of that draft is here.

The ADR Section of the Maryland State Bar Association has submitted comments to the draft Rules.

As a member of the Section Council and chair of the ad hoc committee established to draft these comments for submission by ADR Section Council chair Craig Distelhorst, I have been significantly involved in this issue as I believe that this is an important issue not only for disputants referred to an ADR procedure in the courts, but to all who provide mediation in Maryland. A copy of those comments follows:

I submit this letter as Chair of the ADR Section Council of the Maryland State Bar Association on behalf of the Council and the 400+ members of the Section, all of whom are dedicated to the provision of quality ADR services to litigants in the Maryland courts.

We are grateful to the members of the ADR Rules Subcommittee for their efforts to propose changes to Maryland Rules 17 and 9. We appreciate that the Subcommittee has addressed a concern previously expressed by the Council regarding possible ambiguities in the current Rule as to what cases the confidentiality provisions apply. We commend the Subcommittee for these changes which address a major concern of the Council by drafting Rules that are clear and unambiguous in this regard.

We believe that there are a number of serious questions that need some additional study, input and discussion by the Maryland community of attorneys, ADR practitioners, and ADR practice organizations if mediation, as one of the available ADR procedures, is to be an effective means for dispute resolution in Maryland. We offer the following suggestions and comments, in numerical order for your ease in review, in the hope that they will assist the Subcommittee to ensure that all, including the courts, litigants and their attorneys, and those in the ADR community understand and apply the Rules as intended.

Rules 17-102(b) and 17-202(b)(2) – ADR Organizations and Indirect Designation

The Council does not understand the problem the draft Rule is designed to address when it establishes new provisions that authorize the courts to designate an “ADR organization” who would then select the specific practitioner for the parties. On the contrary, we see problems if this new procedure results in an increase in the number of civil cases referred to various community mediation centers. There is already a considerable amount of consternation about community mediation centers, largely funded by taxpayer dollars and other public funds, providing free services to parties who could otherwise afford to pay. As written, this proposed rule would only exacerbate that concern. ADR services should not be provided free-of-charge to parties who have the ability and means to pay for them.

Analogous to publicly supported pro bono legal services in appropriate civil and criminal legal matters, free mediation should be available for those litigants in the Circuit Courts who cannot afford to pay. The too-frequent delivery of free services to parties in the Circuit Courts is unnecessary and could have unintended consequences on the provision of mediation services throughout Maryland. Additionally, it poses the real risk of significantly devaluing mediation everywhere in Maryland, not just in the Circuit Courts. We are concerned that the draft rule changes enabling the courts to designate community mediation centers will only add to this problem.

Thus, we provide the following draft language for the Subcommittee’s consideration:

Rule 17-102

(b) ADR Organization

“ADR Organization” means an entity, designated by the court for purposes of a non-fee-for-service ADR, which selects individuals who possess the qualifications required by Rule 9-205 or the Rules in this Title to conduct ADR ordered by the court.

Rule 17-202

(b) Tentative Designation of ADR Practitioner

(1) Direct Designation

In an order referring an action or matter to ADR, the court may tentatively designate, from a list of approved ADR practitioners maintained by the court pursuant to Rule 17-206, an ADR practitioner to conduct ADR.

(2) Indirect Designation

Should one or more parties in a case referred to ADR submit an acceptable fee-waiver request, the court may modify its order of referral to require a non-fee-for-service ADR and tentatively delegate to an ADR organization from a list maintained by the court pursuant to Rule 17-206, the authority to select an ADR practitioner qualified under Rules 17-204 or 17-205, as applicable, to conduct ADR. An individual selected by the ADR organization pursuant to the court order shall be deemed to be a court-designated ADR practitioner.

Rule 17-102(f) Definition of Fee for Service

Rule 17-102(f) defines fee-for-service” as meaning that a party “may or will (emphasis added) be charged by an individual designated by a court to conduct ADR under the Rules in this Title or by the ADR organization that selects the individual.” This definition is confusing as to the meaning and purpose. Is it intended to allow for fees to be waived for some parties? For some services but not others? Does the Committee intend to provide any guidelines about when or under what circumstances fees would or would not be assessed?

Rule 17-103. Role of the Mediator

The Council has learned that there is significant concern in the mediation community of ambiguity regarding the drafting of agreements by Mediators. Therefore the Council requests that the Rule and Committee Note acknowledge current practices and provide guidance on best practices in this regard and provide some clarity. Currently the proposed Committee Note to Rule 17-103 acknowledges that “(m)ediators often will record points of agreement expressed by the parties to provide documentation of the results of the mediation,” however this fairly clear language becomes less clear when in the second sentence the Note states that “(b)ecause a mediator who is not a Maryland lawyer is not authorized to practice law in Maryland, and a mediator who is a Maryland lawyer ordinarily would not be authorized to provide legal advice or services to the parties in conflict, a mediator should not be drafting agreements regarding matters in litigation for the parties to sign."

Without more, these two provisions fail to meaningfully distinguish between “drafting” and “recording points expressed.” This confusion is heightened when Mediators in various jurisdictions are given sample parenting plan templates to modify and rewrite agreements with the parties.

Toward resolving the perceived confusion, we note that the American Bar Association Section of Dispute Resolution has addressed this issue in a 2002 resolution in which the Dispute Resolution Section has expressly concluded that drafting a “memorandum of understanding or settlement agreement by a mediator, incorporating the terms of settlement specified by the parties, does not constitute the practice of law.” This view was re-enforced by their 2010 opinion which sets forth the circumstances, i.e., "best practices" for mediator drafting. Rather than summarize these documents we have provided copies with this letter.

To ensure that mediators are engaging in appropriate and ethical conduct, the Council requests for the Rules to provide clarity when mediators are at risk of crossing the line into practicing law without a license or violating the Maryland Lawyers' Rules of Professional Conduct. With that objective in mind, the Council suggests that the Committee Note be rewritten as follows:

Mediators often will prepare a document entitled points of agreement reached by the parties. Use and completion of forms provided by the Court with language adopted by the parties is consistent with this rule. A mediator who is not a Maryland lawyer is not authorized to practice law in Maryland and should not be preparing documents outside of the mediation session and without party input. A mediator who is a Maryland lawyer is not authorized to provide legal advice or services to both parties to a conflict unless the conflict of interest is knowingly waived by the parties pursuant to the Maryland Lawyers' Rules of Professional Conduct. Any document prepared by the mediator to be signed by the parties should clearly state in bold above the signature line that the parties should obtain counsel before signing the document. The mediator should advise the parties of the bold statements above the signature lines. Language in a document which is fully discussed and adopted by the parties as their own is consistent with this rule.

Beyond the drafting quagmire, Rule 17-103 seems to ignore and raise doubts about common Mediator practices. The Rule appears to prohibit mediators from offering their opinions, engaging in other ADR processes and recommending the terms of an agreement. There is a long running debate about whether mediators are purely facilitative or can ever be analytical in style. The use of the analytical mediation style is successfully employed in this State and many other States and responds to those situations when counsel for the parties and the parties themselves want to hear a Mediator’s analysis of certain positions. The Council requests that the Rule acknowledge this practice to provide further clarity and guidance to the ADR community.

Rule 17-202 – Settlement Conferences

When read in its entirety, Rule 17-202 appears to favor settlement conferences as the preferred and first-in-time ADR procedure. In particular, the first and second sentences of draft Rule 17-202(a) imply that a free settlement conference should be the first method of dispute resolution utilized, with the other ADR methods, including mediation, accomplished subsequently, if at all. Since we do not believe that is the intent of the Subcommittee, it would be helpful if some additional language were added to this subparagraph that clarified when settlement conferences should be generally held. To that end, we propose the following language for your consideration:

17-202 (a) Participation Requirements

The court may refer an action or matter to one fee-for-service ADR process in accordance with sections (b), (c), and (d) of this Rule, but participation in that ADR may not be required if a timely objection to participation is filed. The court may also require the parties and their attorneys to participate in one non-fee-for-service settlement conference, which should generally be conducted, if at all, subsequent to an earlier ADR process. Any objection to participation in the ADR process selected by the court other than a non-fee-for-service settlement conference or to the ADR practitioner tentatively designated by the court shall be made in accordance with section (e) of this Rule.

Rule 17-202 – Fees for Service

Rule 17-202(d) provides that a circuit court’s order of referral “shall specify the hourly rate that the ADR practitioner may charge for ADR services in the action, which may not exceed the maximum stated in the applicable schedule.”[1] We understand that a maximum rate would apply for the work accomplished by a mediator who was tentatively designated by the court, but we are concerned that the language of Rule 17-202(d) also could be interpreted as setting a maximum rate that would apply even if the parties select their own mediator.

Rule 17-202(e)(3) adds to this confusion. This draft subsection authorizes the courts to revoke or modify their orders of referrals if a party timely objects, including instances in which a party objects and identifies a different ADR practitioner to conduct the mediation. Thus, if the parties select their own mediator, the court could either revoke its order (thereby releasing the parties from any obligation to go forward with it) or modify it with the name of the new mediator. If it’s the latter, is that new mediator also bound by the maximum hourly rate set forth in the order of referral? If so, the effect would be to allow parties to select their own private mediator, request that a court so designate that person in its modified (or new) order, and impose the maximum court rate for the service. The Council believes that this type of situation would be impractical and damage private mediation practice throughout Maryland. We do not believe that is the intent of the Subcommittee in drafting this Rule.

We believe that there is a simple and very effective approach that would address this potential problem directly. Specifically, we request that the well-drafted language currently proposed for the selection of mediators for custody and visitation disputes under Rule 9-205(d)(5) also be used in Rule 17-202. Draft Rule 9-205(d)(5) identifies the procedures parties may use to substitute someone else in place of the court-designated mediator, including a sample Request to Substitute Mediator, and it makes clear that a mediator selected by stipulation of the parties is not subject to the maximum fee schedule.

The Council does not believe the fee rules should be different for custody/visitation mediation and other types of civil mediation. Rather, we believe that there is a great benefit to the courts, the bar, and the public if the fees language is consistent between the two mediation rules.[2] Thus, we strongly urge the Subcommittee to amend Rule 17-202 so that it mirrors Rule 9-205(d)(5) (or use the same language verbatim)

Rule 17-202 -- Alternatives A and B

In response to the Subcommittee’s request for comments about Alternative A and Alternative B, the Council believes Alternative A, of the two choices, is by far the better option for disputants, their attorneys and ADR professionals. Alternative A mandates that parties participate in one non-fee-for-service settlement conference. Alternative B appears to require the parties to participate in a non-fee-for-service settlement conference and a non-fee for service mediation. While these options are described as free, they are not free – the parties will have to spend the time, money and in cases of represented parties, attorney fees – to participate in two such proceedings. The Council questions the value to anyone of such an approach. Further, it would be useful to have a better understanding about the reasons for contemplating a non-fee-for-service settlement conference as provided in Rule 17-202(a) Alternatives A and B.

Rule 17-204(a) – Qualifications of Court-Designated Mediators

The Council supports policies that give the courts discretion to consider mediator subject matter knowledge and or experience with the type of case when referring cases to mediation. This would allow court mediation programs to emphasize the knowledge, training and experience of mediators when referring civil litigation cases to mediation. Rule 17-204(b) – (e) already provides that in certain types of case mediators should have additional knowledge and experience. This would explicitly allow courts to consider such additional experience in other types of cases where appropriate.

Many members of the Council also question the basis of and reasons for eliminating the requirement of a bachelor’s degree from an accredited college or university as one of the basic qualifications, especially given that the current Rule provides that this requirement can be waived by the courts.

It is not too late to submit comments about the Rule changes, if not to the Standing Committee, then certainly to the Maryland Court of Appeals which will hold a public hearing before the final Rules are approved. If you are interested in participating in this debate - even if you do not practice in Maryland - please feel free to contact me or submit comments below.

[1] “ADR Practitioner” is defined earlier in the draft Rules as an “individual who conducts an ADR under the Rules in this Title.” Rule 17-102(c).

[2] We also note that our proposed change would make Rule 17 more consistent with the proposed Rule 9-205.2 currently before the Court of Appeals for review and adoption. Rule 9-205.2 concerns the appointment of Parent Coordinators and, similar to Rule 9-205(d)(5), makes clear that the court’s maximum fee schedule does not apply to parent coordinators selected by the parties, even if those selections are entered by the courts in a consent order.

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