Med-Arb or Arb-Med: Ethical and Practical considerations for single neutrals Donna Ross September 8, 2015

Terminology ADR Med-Arbiter or Med-Arbitrator or Mediator-Arbitrator Alternative Dispute Resolution Amicable Dispute Resolution. More common to hear Arbitration and ADR. Med-Arbiter or Med-Arbitrator or Mediator-Arbitrator

Definitions Mediation Main Types of Mediation Voluntary Parties Control the Process Main Types of Mediation Facilitative Evaluative Transformative

Definitions Conciliation Arbitration Determinative Statutory Civil Law Countries Arbitration Determinative Binding – Private judge Enforceable as judgment (Internationally under New York Convention)

ICC Step Clause Any and all disputes arising out of or related to this Agreement, the arbitrability thereof and/or to the relationship between the parties, shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce by a sole arbitrator appointed in accordance with said Rules. The place of arbitration shall be Paris, France and the language of the arbitration French. In the event of any such dispute, the parties shall first submit the matter to settlement proceedings under the ICC ADR Rules. If the dispute has not been settled pursuant to the said Rules within forty-five (45) days following the filing of a Request for ADR or within such other period as the parties may agree in writing, such dispute shall be finally settled as set forth in this paragraph. It is the intent of the Parties that, barring extraordinary circumstances, arbitration proceedings will be concluded within ninety (90) days from the date of the arbitrator's appointment. Each party shall pay its own attorney’s fees, expenses and costs.

The Main Hybrid Processes Med-Arb First the parties mediate. Whatever issues aren’t resolved will be determined by arbitration. Arb-Med An arbitration is conducted and the award drafted. Then the parties mediate, and either settle on their own or the award resolves their dispute. Arb-Med-Arb Used primarily to enable a consent award in the Med-Arb scenario.

Variations on a Hybrid Theme Early Neutral Evaluation Arbitration (Bracketed, Last Offer, Final Offer, Bifurcated FOA, Baseball, Night Baseball, Non-binding) Mini-trials Summary Trials Expert Determination Executive Appraisal Eval-Med-arb Private Judging Co-Med-arb Adjudication Braided Med-arb Dispute Review Boards MEDALOA Early Case Evaluation Shadow Mediation Case Management Mediation Assisted Settlement Pendulum Arbitration Mediator’s Proposal

International and Domestic Use Institutions ICC ICDR CEDR SIAC HKIAC WIPO CPR JAMS CIArb “unless otherwise agreed by the parties”. More frequently, an “Opt-In” process.

International and Domestic Use Countries Asia China Japan India Bangladesh Hong Kong Singapore Other civil law countries Germany Switzerland Austria Sweden Italy Brazil Chile Common law countries US Canada UK South Africa Australia Domestically Labor/Employment Family Will Contests

International and Domestic Use Australia CAA NSW Article 27D (3)  Mediation proceedings in relation to a dispute terminate if: (b)   withdrawal of consent by party (c)  withdrawal of consent by the arbitrator (4)  without the written consent (7) the med- arbitrator must disclose to all other parties f the information the arbitrator considers material to the arbitration proceedings. IAA –does not allow for Med-Arb. Section 23D(4) only deals with confidential information.

Advantages Efficiency Flexibility Finality Arbitral Award Cost and Time Flexibility Party Control, Relationship Preservation Finality Arbitral Award

Advantages MSAs - Mediated Settlement Agreements Consent Awards In most countries, only enforceable as contracts Europe: EU Directive 2008/52/EC Initiative for a “New York Convention” for MSAs Consent Awards Enforceable under the New York Convention, the rules of major arbitral institutions, Model Law Article 31 Some jurisdictions the tribunal must be constituted before the mediation.

Risks Challenges to Enforceability Bias/Lack of Impartiality Coercion of Parties Breach of Confidentiality Non-Compliance with Rules or Laws The main culprit: Caucussing or Private Sessions

Safeguards Choice of neutral Rules and Laws that Govern the Process Trust Skill set/expertise Impartiality Rules and Laws that Govern the Process Institutional General – UNCITRAL Model Law Local – Law of the Seat or Place of Enforcement Adopt IBA Guidelines? Professional/Ethical Rules

Safeguards Process Design and Conduct Pre-Mediation or Arbitration Conference Ensure Parties’ Understanding – not just Counsel Med/Arb agreement/Procedural Order/Terms of Reference Set forth detailed process Clear Delineation Between Mediation and Arbitration Caucussing or Not? If so, disclose or disregard information?

Safeguards Process Design and Conduct Consent, Consent, Consent Waiver Clear, Informed and Written Waiver Waive right to challenge the award Opt-out For Parties For Neutrals

Safeguards Reasoned Award Consent Award Based only on facts and law submitted during the arbitration phase. Use of information learned during mediation could expose the award to vacatur, even if the parties consent in some jurisdictions. Include description of process, consent and waivers in the award. Include issues agreed by the parties during the mediation phase (partial consent award). Consent Award If mediation is successful memorialize the agreement in an award rather than an MSA.

Med-Arb or Arb-Med: Ethical and Practical considerations for single neutrals Thank you for your attention