Guests: Coulson, Robert; Grin, Spencer
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THE OPEN MIND
Host: Richard D. Heffner
Guest: Robert Coulson with Spencer Grin
Title: “The first thing we do, let’s kill all the lawyers”: Shakespeare
I’m Richard Heffner, your host on THE OPEN MIND. And since my young son and many of my other favorite people are lawyers, I really only joke when I quote Shakespeare: “The first thing we do, let’s kill all the lawyers.” But in some places these days their profession is held in something less than high repute. And if there does indeed seem in many instances to be an alternative resolution for disputes that otherwise keep lawyers employed but also increasingly pressure and literally clog our traditional court system, then there may well be some cause for cheer and encouragement particularly when ADR, alternative dispute resolution as the late great legal scholar Dean Robert McKay put it, offers greater litigant satisfaction often leading to more expeditious disposition of disputes at lower costs and with parties having greater control of the progress of their cases which also may ordinarily be kept private, out of the glare of disruptive damaging publicity. But Americans must become much more aware of ADR, alternative dispute resolution, to make meaningful enough advantage of it. And when S. Spencer Grin, an old friend associated with RESOLVIT, a private company that offers its services as what it calls an alternative to costly litigation, introduced me to the concept I decided to ask him and Robert Coulson, long-time president of the non-profit American Arbitration Association founded sixty-five years ago, to join me here to shed some light on ADR’s advantages, possibly even to take a peek at its downside.
First, however, this matter of keeping disputes confidential with ADR; if that can indeed be seen as a matter of private interest isn’t there still some question about it perhaps not being in the public interest? And gentleman that’s where I would begin, not necessarily with a negative but you need to explain it to me. Spencer?
GRIN: Well, to begin with, both parties have to agree this is a voluntary consensual type of procedure. And so if both parties agree that they want to be out of the glare of publicity, I don’t see that there would be any detriment to a private resolution. As a matter of fact, in many cases it’s preferred. You’re away from the glare of the lights, the publicity, and you can really resolve a matter by mediation or arbitration in a much more expeditious way without the glare of publicity.
HEFFNER: Do you know we were speaking before the program began about our mutual friend Steve Brill and this matter of cameras in the courtroom. And while he and I have been at odds on that matter, he has always said and others have said too that the public has a right to know when there are disputes and what the resolution of those disputes may be. And so Bob I wonder whether you don’t see something that we have to be concerned about, about the private nature of ADR.
COULSON: Well you do have to be concerned about applying privacy in those disputes that the public has such a vital interest in and it should know. But, you know, most disputes that are dealt with in the courts, civil courts, are simply business disagreements between people who have the full right under our system to settle them privately. Disputes are settled by the millions in our society without any government intervention. And the use of a private mediator is simply a way of strengthening the negotiating process. And the use of an arbitrator is the same thing. It’s an extension of private settlement and it would be a bad day in the United States when private settlements have to be publicized because the right to privacy is a very essential part of a free economy, a free society.
HEFFNER: Yes, but here we are talking about a system that is based upon the notion that there are disputes that have not been resolved privately and that would otherwise I suppose go to the courts. And yet, you gentlemen are pressing this matter of alternative dispute resolution. And I wonder if some, if not many of those cases aren’t ones in which there is some public interest in knowing about it. Spencer, I’ve excited you about that.
GRIN: No, well I think I can clarify possibly by suggesting to you that, and I think Bob will agree, ADR is not for criminal cases. RESOLVIT, which is a national organization just as the AAA is, will not take any criminal cases. And of course I think in a criminal case the public’s right to know is very important and should be paramount. But as Bob said in private cases, first of all our court system is absolutely log jammed to the point of no return. Almost every state has such a backlog of cases that in many instances if you go through normal litigation it’ll take you five years. In ADR you can possibly accomplish that in two to three weeks. Now that alone suggests that ADR is a much better alternative than litigation aside from the expense. I mean the cost is prohibitive today in going through litigation and at ADR it’s a mere fraction, maybe a tenth of what it would cost to go through litigation.
HEFFNER: Bob, are those the elements that most concern you? Cost, time: are these the rationales for ADR?
COULSON: No. ADR is a very large subject, the use of ADR. There’s ADR in the courts. The courts have courted ministered arbitration systems, court mediation programs. They’re using settlement conferences as a method of ADR. Private ADR is used in many, many different fields. There’s divorce mediation. There’s the use of arbitration clauses and contracts and there are millions of contracts that have Triple A arbitration clauses in them. There’s the use of the mini-trial which is a very sophisticated way that large companies negotiate with each other using a panel made up of senior executives of each company and a neutral person who chairs it. There’s community mediation which is a form of ADR. And these are criminal cases. And there are hundreds of these programs around the country. The American Arbitration Association was one of the pioneers in that field. So when you talk about ADR you have to first say, well is it private, is it public, is it more or less a mediation process or is it more or less an arbitration process, and if it’s arbitration is it binding or is it advisory, or is it last offer, the kind you have on the baseball field to determine salaries for free agents – very complex subject area. But the essence of it is that people have the right to resolve their own disputes any way they feel is appropriate. Now there are some disputes where there’s so much public interest that there should be disclosure, it should be decided in court, and the press should be in there watching.
HEFFNER: Now, do you make a determination that that’s the case in certain instances?
COULSON: No, the American Arbitration Association is there to serve parties who have decided that their dispute is such that it is appropriate for a private dispute resolution technique, either mediation or med-arb or one form or another or arbitration or the election process which is another way to resolve disputes. It’s up to the courts to determine when it’s inappropriate for a dispute to be privately arbitrated. It’s also up to the legislature. There are some laws that say that disputes, under this act which creates a new cause of action, cannot be decided except in federal court. And the Congress says that, then the Congress has made that political determination.
HEFFNER: Spencer, before I was saying that maybe it’s just a matter of mea culpa and I should have known a good deal more and should know now a good deal more about ADR. After all, this is a table that is occupied probably more frequently by lawyers than by any other group of citizens. Why is ADR such a mystery even to a fairly well educated person such as myself?
GRIN: Well, that’s a difficult question for me because I really believe that the average person doesn’t realize that you can go to an ADR firm, whether it’s the American Arbitration Association who’s been doing arbitration for sixty-five years as you said or RESOLVIT by dialing 800-24-RESOLVIT, as simple as that. Just dial that number and if two parties want to agree to mediate, which is non-binding, all they do is sit down with someone who’s skilled to help them resolve a dispute that they have. And a skilled mediator is usually very helpful in doing just that. But the important thing is that if they want to bind themselves to binding arbitration, even after the mediation, we have something called the RESOLVIT option which you a fixed cost to do this. And again, it’s a fraction of what it would cost to litigate. You can get an award, an arbitrator’s award which is just as good as going to court. As a matter of fact it is filed and confirmed in a court of law. So that the normal person that has a dispute, the first thing they will do is go to their lawyer. And lawyers come in often, as Bob will tell you, and argue the case for their client in an ADR forum. The difference is that it takes a few days or a week instead of five years. But most people don’t know that if they choose binding arbitration they will have settled their dispute just like a court verdict, the same as if a judge handed down a verdict or a jury handed down a verdict. It’s just as binding, just as enforceable. And most of the populous don’t know. Maybe Bob can answer why people don’t know. I don’t understand it.
COULSON: Well, I think the human mind is programmed like a computer. And when the concept of dispute comes to a person’s attention we’ve been programmed because of our education to think, “Well, courts, lawyers. Get a lawyer. A lawyer will represent us.” And we go to a lawyer. And up until fairly recently, lawyers were not trained in law school in ADR and it wasn’t the first thing a lawyer would talk about. A lawyer would say, “Well if you have a cause of action, we’ll file a lawsuit.” And so this kind of a mindset that the schools gave non-lawyers and that the law schools gave lawyers is something that we’re slowly trying to change. And when you really look at the dispute resolution process you realize that most disputes are resolved on the telephone or in face to face meetings. 99% of the disputes are resolved that way. You don’t need a lawyer to resolve a business dispute, most of them. A lawyer comes in only when things are really difficult.
HEFFNER: Now, a question to me, a question put to me by a judge: isn’t this a process that demeans in some way the importance and significance of the courts? Aren’t you to some extent, with good reasons as you’ve discussed them, undermining the courts?
COULSON: Well that could have been put to you by a judge in 1776 at the point that the judges were being ousted of jurisdiction if there was an arbitration clause. But now most judges, and I’ve talked to hundreds judges in the last few years and the chief judges in particular, most judges support arbitration and mediation. And in fact they’re installing it in their own courts. Virtually every court system now has courted ministered arbitration. And we’ve been training judges and training court mediators right across the country. Because judges realize that they’ve got a terrible problem. They’re short of funds. They’ve got a tremendous case load. People aren’t happy with what happens to them in court. They’ve got to figure out a way to resolve disputes more efficiently. And that’s Alternative Dispute Resolution. And so, most judges are very supportive of the process.
HEFFNER: Now, you suggested before that law schools and institutions of higher learning generally are making some inroads on the ignorance that prevails.
COULSON: Oh, they’re turning it around. There’s an organization called NAME, National Association for Mediation in Education, which is training students in the schools in how to be mediators. And virtually every law school in the country now and business schools have courses on ADR. They train the people in negotiating and being mediators and in using arbitration. And that’s a big change. And that’s making inroads on the perceptions of business people and certainly business lawyers.
GRIN: It’s also interesting that the bar associations are now supporting ADR. I think back some years when ADR was not a popular word among lawyers, but certainly today the large preponderance of jurists, as Bob said, are supportive of ADR. As a matter of fact, we have over seven hundred and fifty retired judges who are our mediators, who work for us when they retire. And the active judiciary needs this. You just have to look at the suit that was recently filed in New York by Chief Justice Wachtler against Cuomo. They don’t have the funds to administer the costs efficiently any more. The time is just so lengthy with so little personnel that they just can’t do the job, so that they need ADR and they’re very supportive of. The Colorado Bar Association for example went around getting businesses to sign the ADR pledge, which says in essence when we have a dispute, before we attempt litigation we will talk to one another about Alternative Dispute Resolution in the hope that we can mediate it or arbitrate it. And the Bar Association took the lead to get companies to sign this. The problem is to get the individuals. You see, institutions by and large today are very ADR-minded. As a matter of fact President Bush signed a bill recently, I think it’s Public Law 10150, that mandates every government agency must adopt an ADR procedure. So that the government agencies now will not go to court first, they will go through Alternative Dispute Resolution. They’ll call RESOLVIT, they’ll call the AAA, but they have to have a means to work in Alternative Dispute Resolution.
What troubles me is the average citizen. And maybe it’s the mindset that Bob spoke about. But it’s important that the word goes out because the courts are being overloaded; criminal cases, narcotic cases. For example, I give you an idea. Let’s talk about asbestos cases. Now, asbestos cases have been growing at a rate of, well I think over 50%. There are some 34,000 cases on the books right now. And they’re predicting by the turn of the century that’ll increase by another 50%. I was talking to Dr. Albert Teirstein, who is a noted pulmonary expert from Mount Sinai Hospital, and he’s testified in a number of asbestos cases. His thoughts were that the poor asbestos victims die before they see compensation because of the length of time it takes to get to court. And as Bob said, it’s usually settled on the steps of the courthouse, or when the jury is picked it’s settled anyhow. So why not do it initially? The Manville Trust used up 66 and 2/3% of the money that was set aside for these victims in legal and administrative costs. The victims were left with 1/3 to divide of what was set up. All because the local populous, people don’t know that they can just pick up the telephone and dial an 800 number and get the thing resolved.
HEFFNER: Isn’t this a considerable indictment of our court structure? Aren’t you there because the courts have failed us?
GRIN: It’s the money. It’s the resources.
COULSON: There’s no doubt that the courts in the United States are basically an obsolete method of doing what they’re supposed to do which is to encourage people to settle disputes and decide those disputes that can’t be settled, in addition to settling the criminal case load. And the courts are underfinanced. They’re not very well administered. They don’t have a modern administrative system. And they’ve got court rules that were designed back in the agrarian ages in England. And a combination means that court system, even assuming that everybody in the courts is doing their level best, these people in the courts are trapped in a system that won’t work. And I think everybody knows that.
HEFFNER: So this is privatization with a vengeance.
COULSON: It’s privatization because, because our society allows people to resolve their own disputes privately; doesn’t require the government to get involved in the dispute resolution process. So it’s not anything with a vengeance. It’s really a very good illustration of the fact that in a free society people can take charge of their own lives and resolve their own disputes among other things.
HEFFNER: You were objecting.
GRIN: Well I was objecting to the idea that the courts are obsolete and that their rules are archaic. As a lawyer I don’t think I could go quite that far. I think it’s really a matter of resources more than anything else. The courts could function. There will always be a place for ADR because ADR is faster. And maybe the courts don’t act as efficiently as they could but by and large I think it’s more a matter of resources. And resources in this country, you know, are being allocated in a way that many of our institutions are hurting. It’s not only the courts that are hurting. But the courts are supposed to dispense justice. And when you wait five years waiting to be heard, justice is usually not dispensed at that point. People forget exactly what happened. The disputes get exacerbated by attorneys and discovery and all kinds of motion practice. So in some ways there are archaic procedures, but I wouldn’t say the courts are obsolete. The courts, if they were funded properly, certainly have a place in the United States.
And I might say that it’s not only our free society that does mediation. China has mediation centers, all over China. They’re one of the oldest societies that have been using mediation. In Japan for example, I’ll give you an insight into their industrial procedures. In many cases when they sign a contract, two Japanese companies, they anticipate the possibility of a dispute on that contract and write in right at the beginning an arbitrator or a mediator. In the event of a dispute they’ve already named the person, usually a grey haired gentleman who is of high repute. And both parties will agree that in the event of dispute we’ll have it mediated by this gentleman.
HEFFNER: Now I’m interested that, I think Bob it was you who said a few minutes ago that – or maybe Spencer, you’d agree I’m sure that lawyers, you professionals, not you personally, initially tended to object to the procedure, to the process. Why?
COULSON: Well I think that it’s a mindset that they acquired at law school coupled with the fact that their early practice was pointed towards the courts. This concept of using mediation is fairly new. Arbitration goes back a long way. Arbitration clauses since 1926 have been enforceable in most states, and each state has passed a modern law to enforce arbitration clauses. And there’s a federal act to do the same thing, and that’s true in other countries. But mediation is quite new and it’s taken, I think, lawyers some time to understand mediation, understand they have a role in it in most cases, and that many of them are serving now as mediators. And I think it’s a learning experience and I think it’s a good thing.
HEFFNER: You say that many lawyers still have a role in it. We can’t yet follow Shakespeare’s advice.
COULSON: Oh, no. All of these ADR processes are saturated with lawyers. Any significant case that’s arbitrated will have a lawyer on both sides and very often a lawyer on the panel. Mediators are very often lawyers, certainly in all the court ADR programs there are lawyers throughout. So this is not a way of getting rid of lawyers. It’s a way of persuading lawyers to do their job more efficiently, to sweep aside the archaic rules of the courts and basically utilize realistic rules that are intended and designed to find out what the facts are and then obtain a decision, or find out what the problem is and then help the parties come to a decision; mediation on one hand, arbitration on the other.
HEFFNER: I noted that you referred to federal law and I noted that in fact the Administrative Procedure Act, enacted by the ADR act, cites several examples of when an agency should “consider not using” Administrative Dispute Resolution. “Such consideration should be taken if one of the following factors applies: a definitive or authoritative resolution with precedent setting value is required.” Now that’s – I should have read this first before when I was making this point. Doesn’t this make you feel a little bit uneasy? Isn’t this a downside?
GRIN: No, a case where a legal precedent should be set, if that’s the ultimate goal of one of the parties ADR is not appropriate. There are certain cases, as I indicated; I think criminal cases, ADR is not appropriate. Certainly if you want to set a legal precedent that possibly will go up to the higher courts and become the law of the land, you don’t want a private confidential resolution.
HEFFNER: Spencer, if this is your objective I suppose you’re quite correct. But doesn’t this happen willy-nilly? In the mediation/arbitration/Alternative Dispute Resolution process, whatever form it takes, don’t we run the danger that precedents are being established out of the context of our judicial system?
COULSON: Well, they’re not being established. In mediation the parties are simply settling their disputes. There’s no precedent; they’re settling their dispute privately. It’s not published. It doesn’t set a standard for their industry. It’s simply a settlement.
HEFFNER: Any impact at all?
COULSON: There could be. I mean I can think of hypothetical cases where it might be inappropriate for parties to settle. For example there’s a – medical malpractice, there’s now a law where medical malpractice decisions have to be filed in a central databank in Atlanta, Georgia maintained by the Federal Government because there was a legislative feeling that it was important to keep score on who the, you know, doctors were that were providing inadequate care. And that’s a political decision, a legislative decision. And that’s quite appropriate I think. And it may be that some arbitration, some clusters of arbitration should be the same way. For example, we run a system of arbitration for the Attorney General of New York State. It’s called a Lemon Law system. The Attorney General receives reports on all of the awards. And once a year the Attorney General reports them; that it shows that one company had a lot of lemons and another company didn’t have any lemons at all. And the consumers have an interest in that. And I think that’s a nice partnership between the government and a private system of dispute resolution.
HEFFNER: And publicity for the resolutions.
COULSON: Yeah. Sure.
GRIN: I was going to take exception again and disagree with Bob respectfully about…
HEFFNER: You got about a half a minute to do it.
GRIN: Well, about the medical malpractice filing as a good thing; I think it’s a poor thing because what happens in medical malpractice is that every physician who has that patient on the chart, even if they didn’t touch the patient, is then reported down to Atlanta. And the physicians themselves now are shying away because they don’t want their names reported. I can see valuable data could be collected from physicians who are not competent, who have really created malpractice. But you have to start to look into malpractice. One surgeon pays $220,000 a year for premiums. Now that’s unheard of!
HEFFNER: I can understand why names shouldn’t be mentioned. No names, please!
HEFFNER: Spencer Grin and Robert Coulson, thank you so much for joining me today in this discussion. And thanks, too, to you in the audience. I hope you join us again next time. And if you’d like to share your thoughts about our program today, please write The Open Mind, P.O. Box 7977, F.D.R. Station, New York, NY 10150. For transcripts, send $2.00 in check or money order.
In the meantime, as an old friend used to say, “Good night, and good luck”.