What to do when Mediation-Arbitration goes Wrong



Lorne Wolfson for The Lawyers Weekly

Family Lawyers Facilitate Successful Mediation-Arbitration

Hire a Family Lawyer to Avoid an Unfair Separation Agreement

Family Lawyers acknowledge that divorce typically causes both parties involved a lot of stress. This is why before starting your separation agreement your Family Lawyer assesses the potential arbitrator. Specifically, when choosing an arbitrator Family Lawyers make sure that you are comfortable with them and that they meet your standards. If any issues ever arise during the divorce settlement, normally your Family Lawyer identifies these problems and organizes a new method of divorce or a new arbitrator.

Other than identifying if the arbitrator is neutral or not, Family Lawyers also assist in making the finalized separation agreements. This way, your Family Lawyer can make sure that you get what you want during the mediation-arbitration. The separation agreement may sometimes be overwhelming for the people involved. Family Lawyers are usually aware of this and understand that their role during the mediation-arbitration process is important in simplifying the legal jargon. This particularly involves explaining the final separation agreement in laymen’s terms to you and making sure you are happy with it. Use our FREE online legal directory to find a Family Lawyer that will ensure a smooth mediation-arbitration settlement.

Family Lawyers May Also Act as an Independent Mediator

If you want to avoid the courtroom and headaches then your Family Lawyer may help by acting as your personal mediator. Experienced Family Lawyers can assist you through every legal issue during the separation process. You may use them for consultation when speaking to the arbitrator as well as have them make the separation agreement. Family Lawyers are also allowed to process the separation agreement, saving you time and money. This way you do not have to brief anyone about your divorce settlement, which may cause you further distress. Lorne Wolfson from The Lawyers Weekly outlines what a person should watch out for during mediation-arbitration. During this anxious time let your local Family Lawyer guide you through a successful separation agreement.

May 28, 2010

Mediation-arbitration has become the preferred choice in recent years for many family law lawyers and their clients.

Mediation-arbitration received a significant boost when it was recognized and endorsed by the Ontario Court of Appeal in Marchese v. Marchese, [2007] O.J. No. 191. Its success rate (the vast majority of cases settle in the mediation phase) has made it more popular in many circles than its cousins - traditional mediation, collaborative law or litigation.

While the advantages of mediation-arbitration - accessibility and adaptability, lower cost, predictability, privacy, good results, and speed - have been well-documented, less attention has been paid to those cases that are not suitable for mediation-arbitration, and what the mediator/arbitrator should do when a case goes bad.

Cases not suitable for mediation-arbitration

Experience shows that the following cases are likely not appropriate for mediation-arbitration:
  • Domestic violence or power imbalances exist that cannot be remedied by the presence of counsel;
  • There is difficulty in obtaining financial disclosure;
  • There is a need to bind third parties;
  • The parties can't afford the cost of a third professional;
  • The parties won't respect court orders or arbitral awards;
  • One party is represented by competent counsel and the other is not;
  • An unhappy party is likely to abandon the process or use the arbitrator's fees as leverage;
  • The case requires the arbitrator to determine a novel point of law.

Precautions

Wise arbitrators will take precautions at the outset before accepting cases that demonstrate any of these danger signs.

They will disclose any prior relationships with any of the parties or counsel that might possibly create a reasonable apprehension of bias. They will ensure that they use well-drafted arbitration agreements that include clauses that permit them to resign at any time, terminate the mediation phase at their discretion, determine the procedure for the arbitration, retain an expert at the parties' expense, accept retainer payments from one party on behalf of another party who has failed to pay, and make awards for interim fees and disbursements.

They will also insist on adequate retainers to ensure that they can complete their mandates (hear a motion, finish the hearing, write the award, etc.).

Terminating the arbitration

Section 43(3) of the Ontario Arbitration Act provides that an arbitrator shall make an order terminating the arbitration if he or she finds that continuation of the arbitration has become impossible. An arbitrator may resort to this provision if domestic violence or power imbalances exist, competent counsel is absent, or other causes prevent the arbitrator from ensuring that the parties have been treated fairly and equally, or if the conduct of a party (failure to respect awards, replenish retainers, etc.) prevents the arbitrator from properly discharging his or her statutory duties.

Resignation of the arbitrator

Section 14(1) of the Act provides that an arbitrator may resign. While the statute is silent on the need for reasons, s. 14(2) ("an arbitrator's resignation[...]does not imply acceptance of the validity of any reason advanced for challenging or removing him or her" ) implies that the arbitrator need not give reasons for his or her resignation.

An arbitrator's resignation raises a number of issues. First, how is a new arbitrator determined? Section 16(1) of the Act provides that a replacement arbitrator shall be appointed when an arbitrator's mandate terminates. However, s. 16(5) provides that s. 16(1) does not apply if the arbitration agreement provides that the arbitration is to be conducted only by a named arbitrator.

The arbitration agreement can avoid this problem by providing for appointment of a replacement either by agreement or court order.

Second, what happens to the old arbitrator's awards? Do they become void upon his or her resignation? Once again, the problem can be solved by providing, in the arbitration agreement, that any interim awards made will continue in full force and effect until amended by either a replacement arbitrator or the court.

One size does not fit all

While mediation-arbitration continues to grow in popularity, one size does not always fit all. Counsel should be realistic about the prospect of a successful mediation-arbitration. Parties who have generated high conflict litigation will likely generate high conflict mediation-arbitration.

Such cases should stay in the court system, leaving mediation-arbitration for those parties who are most likely to benefit from that process. Arbitrators should also be cautious when accepting cases and realistic in their assessments of what can be achieved. By identifying the "bad cases" early, arbitrators can save themselves and their clients much grief down the road.

Lorne Wolfson is a partner at the Toronto law firm of Torkin Manes. His family law practice includes litigation, mediation, and arbitration.


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