Presumptive Alternative Dispute Resolution (ADR) – Interim Report and Recommendations (Part 1)

Last week, I wrote about “presumptive alternative dispute resolution,” which New York will be introducing (and expanding) throughout the state.  Primarily, I addressed mediation in that post. Here I want to continue on the topic of Presumptive Alternative Dispute Resolution (ADR), because the changes will be so significant and far reaching for New Yorkers.

But first, what is ADR?

“Alternative Dispute Resolution” refers to ways of managing and settling disputes without litigating them.  Because litigation is the way that so many conflicts have been (and continue to be) handled, other manners of dealing with disputes have been labeled as “alternative” methods.  The term – which includes the processes of mediation, arbitration, neutral evaluation and others – has not always been used with respect by some members of the legal community.  Nevertheless, ADR is set to become much more prominent in New York over the coming months and years.

The further adoption of ADR in the State, which will allow many parties to save time and money, is long overdue.  In the case of mediation especially, parties will have more control over the outcomes of their cases and suffer less stress.  Relationships that are so often badly damaged or destroyed during litigation (think divorce, for example) are significantly more likely to remain respectful and functional during and after mediation, which encourages disputants to share their stories, listen to each other and mutually agree on how to move forward.

A Statewide ADR Advisory Committee has issued an Interim Report and Recommendations.  Here are a few of the highlights:

  • There will be “increased training and education about court-sponsored mediation for judges, judicial administrators, court staff, advocates, parties, mediators, and the general public”;
  • Rules requiring “attorneys to become familiar with mediation and other processes, to discuss with clients both mediation and other potential alternatives to conventional litigation and to discuss ADR options with opposing counsel in good faith” will be promulgated.  [In the past, many (but by no means all) litigators have not informed potential clients about mediation and other ways to handle disputes.  If a client raises the idea of mediation, some litigators will speak of the process in disparaging terms.  Back in 2015, I shared my thinking that lawyers who failed to inform clients about mediation were committing an ethical violation of their professional obligations:                                                                                                                                                                                                                                           According to Section B of Rule 1.4 of the New York Rules of Professional Conduct, entitled “Communication,” a lawyer “shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representa­tion.”                                                                                                                                                                                                                                                  Is it ‘reasonably necessary’ for a divorce lawyer to tell a potential client that there is another way to get a divorce without litigating in court? I think so — if that client is to know enough to make an informed decision regarding the representation.                                                                                                                                                                                                                                                It will be interesting to see how willingly attorneys deal with this responsibility in the future.]
  • Engage with and reach out to the legal community and law students concerning early mediation and other forms of ADR.  [Teaching law students, who are generally young and who of course will first be beginning their legal careers, more about ADR should go a long way toward changing our litigious culture over time.]                                                                                                                                The Interim Report has much more to say.  I expect to continue discussing it next week.

Experts who may be able to assist you (in or out of mediation)

In my last post, I began writing on the subject of getting help during divorce when it comes to gathering and understanding financial information.  I mentioned that family members , friends and neighbors may be supportive.  But, they may not be aware that we need their help; it may be awkward, even for those who care about us, to bring up the divorce and related issues, and so we may have to take that first step and let others know what we need.  In my previous post, I also suggested that enrolling in a class dealing with the basics of handling money may be worthwhile for some of us.

Now, I want to introduce the idea of looking to experts:

  • If  you are stuck, a therapist or support group might be helpful.
    • A social worker or psychologist may be able to assist if you have unhealthy attitudes about money.  If sadness, let’s say, is the issue rather than money, help in dealing with your emotions may make it easier to grapple with other matters, such as the financial ones.
    • A support group can be a very positive environment.  During my own divorce, I felt embarrassed, even ashamed.  As if I was the only one in the world going through a marital breakup. Joining a support group made me feel much less alone.
  • Having trouble with some of the numbers? Perhaps your accountant can assist you. (Depending on your needs, there are also “certified divorce financial analysts”, tax attorneys and others that may offer the services you need.   Think about what questions you need answered, and who can do that job for you. Unsure about what a particular professional does? Go on the computer and search for “What is a certified divorce financial analyst?”)
  • If you need someone to listen, help you consider and develop your goals, and then hold you to account on fulfilling those goals, a “divorce coach” might be right for you. A good divorce coach will be on your side, offer support and assist in focusing your thinking.  Even when we know what we ought to be doing, having someone to keep us on track can make all the difference in getting things done.
  • Wondering what something is worth?  Almost anything can be appraised, from jewelry to a home, to artwork or a business.  (Some caution is warranted here; not everything is worth the cost of an appraisal.  There are other methods of assigning values to items; something to be discussed at another time).

This isn’t by any means an all-inclusive list of the resources; but perhaps it will give you an idea of who and what is out there to help you learn more and get through a separation or divorce.

Spouses in mediation often avail themselves of one or more of these types of assistance.   But, of course, you don’t have to be a mediation client to get such help.

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All blog posts are for information purposes, and should not be considered as legal advice.

Next time: Experts in mediation: they play a different role than they do in litigation.

Help in gathering and understanding financial information

In my previous post, I discussed the types of information that many spouses need in getting divorced; and, where to begin to look for the information. But for a good number of people, gathering these facts and figures is easier said than done.

What to do:

There are different ways to help yourself – or to have someone assist you; your temperament, as well as the money you have available, may well affect your choices. But here are some possibilities to consider:

  • People power: Do you have a family member, friend or neighbor that you trust and are comfortable with? Might that person be helpful in reviewing papers with you; or, even ‘just’ keeping you company as you do this work. Can you meet somewhere and have this person act as a sounding board as you speak your thoughts out loud. Note: It is probably best not to involve a child – even an adult child – to play such a role; of course, every case is different. But, if what you want would put your child in the middle between you and your spouse, most likely, you should choose someone else.
  • Take a course: Your local community college may offer a course on budgeting or financial literacy. Such classes are usually of short duration and reasonably priced. By attending such a class, you can learn things that will help you during (and after) the divorce. Learning may well boost your confidence. And, by going out and being around other people, you may feel less isolated and lonely.

Next time:  Experts that you may want to consider.

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All blog posts are for information purposes, and should not be considered as legal advice.

Gathering Information. Part 5: Informed Decision Making in Mediation

In every divorce case, there are financial issues to address.

Some spouses come to mediation already having and understanding much of the information they will need to make decisions to end the relationship. A few have the information, but refuse to share it.

Most often, spouses are willing to provide information; but, one or both of them may be unsure about where to find it.

A mediator can help with this.

What information do spouses need?

Basically, when it comes to monetary issues, spouses have to know about the following:

  • Income: Salary, bonus, royalty, pension income, real estate income . . .
  • Expenses: Housing, food, clothing, different types of insurance, uninsured medical, home maintenance, education, recreation . . .
  • Assets: Cash, bank accounts, stock options, interest in a business, value of life insurance, motor vehicles, real estate, retirement accounts, interest in trusts, household furnishing, jewelry, art, trademarks . . .
  • Debts/liabilities: Mortgage(s), other loans, taxes owed, credit card accounts . . .

Where can I find information about my finances?

Much of the information a person is likely to need can be found in financial “statements” of one kind or another. These may be in a file cabinet or in a pile somewhere; probably, they are available online, and often will go back several years into the past.  Just to begin with:

  • Bank statements can offer a good picture of what you are spending some of your money on; if you have direct deposit, it will also tell about earnings.
  • There are mortgage statements, and ones for home, auto and other types of insurance.
  • Credit card statements will probably be helpful in showing where much of your money is going.
  • There are retirement and investment account statements; going on the computer, you can likely find out the exact value for many of them. (Note: there are certain accounts where it is more difficult to learn about what they are worth today – sometimes called ‘present-day value’. I hope to address such accounts at another time.)

A mediator will provide a form asking for the information that’s needed.

Often, I will give clients what is called a Statement of Net Worth, a form with many categories and subcategories of expenses, assets, etc. It is lengthy; but, in filling it out, clients are likely to be reminded of whatever they may have forgotten about until then.

A spouse may find it challenging to gather and go through their financial statements. In my experience, this is fairly common. If you think that the process might be difficult for you, I understand; and I want you to know that help is available.

Next time: Help in gathering and understanding financial information.

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All blog posts are for information purposes, and should not be considered as legal advice.

When a client won’t provide information. Part 4: Informed Decision Making in Mediation

I’m working with divorcing clients, and Wife is sharing information about her budget. Husband refuses to do the same. I ask whether he has concerns about providing such information, and he is not forthcoming. He has the facts and figures, but won’t tell us about them, bring in financial statements, etc. To make a long story short, Husband will not fully participate in the mediation process.

What happens?

Mediation is a voluntary process, and it is the parties who make the decisions: Will they schedule a mediation session? After the first one, will they return for the next? Will they reach agreements? Each party makes these choices for her/himself.

Similarly, each party – each spouse in this example – decides whether to share information about earnings and expenses, assets and liabilities. Once in awhile, a party decides not to.

Then what?

A mediator has no authority to compel parties to provide information; s/he is unlike a judge in this way. If a party won’t share it voluntarily, all the mediator can do is:

  • explain once again why giving the information is necessary (so that all parties will have enough information to make decisions);
  • explain that the mediation will have to be terminated if the party doesn’t change his/her mind; and then,
  • end the mediation.

In my experience, unwillingness to provide information most often becomes apparent during the first phone call or at the consultation; in other words, prior to any session being scheduled. If it happens over the phone, that part of the conversation usually goes something like this:

  • Mediator: In mediation, you would both need to share information with me and the other party. Do you think that you and your spouse would be willing to do this?
  • Potential Client: No, s/he will never go for that.
  • Mediator: Perhaps you can talk this over with your spouse; or, s/he is welcome to call me, so that we could talk, just like you and I are talking now.
  • Potential Client: It would be a complete waste of time.
  • Mediator: From what you’ve just told me, mediation is unlikely to work in your situation. Sometimes, a spouse will be more flexible and open once the process begins. But, just based on what you’ve shared, mediation doesn’t sound promising.
  • Potential Client: No, but thank you for your time and explaining all of this to me.

A crucial aspect of mediation is ‘informed decision making’. When a party withholds information, the other party is unable to fully know what the situation is, and would be deprived of the opportunity to make thoughtful decisions. To work (or continue working) with parties under these circumstances would be unfair to the party denied the information.  Mediation is not appropriate; if the process has started, the mediator must end it.

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What if clients make choices that I wouldn’t? Part 3: Informed decision making in mediation

I’m working with spouses, assisting them through the divorce process. They’ve come to an agreement that on a personal level makes me uncomfortable. That is to say that one of the parties has decided to do something that I wouldn’t.

As their mediator, what do I do? The short answer is ‘Nothing’, but let me explain with the help of an example; I’ll use the scenario that I set out in my previous posts on Informed Decision Making in Mediation.

Husband and Wife own a home.

  • Wife says to me:  We have a house that we bought when we got married. I’ll be buying him out, and paying him a million dollars.
  • Husband says:  Yeah, that’s what we’ve decided on.

As part of the mediation process, we have gone over the couples’ finances. I quickly learn that Wife will not be able to afford the house.

Wife tells me that she expects to get a significant raise at her job shortly. In the meantime, she is prepared to draw on savings. If the raise doesn’t come through, Wife understands that she will probably have to sell the house within two years. That would likely mean losing money, and maybe a lot of it. But Wife is prepared to take the chance. Wife says that, “If I have to sell, it won’t ruin me.”

Now pretend that I – the mediator – wouldn’t voluntarily put myself in this situation; that I am more conservative when it comes to money than this Wife is. Maybe this means that, if I were in her shoes, I would look to rent or buy a place I knew I’d be able to afford; otherwise, I wouldn’t be able to sleep at night because of the worry.

Do I discourage the spouses from signing their proposed agreement because I think it would be ‘wrong’, at least for me?

No.

In mediation, parties are free to make their own decisions. In fact, they need to; I won’t make the decisions for them. As a mediator, I don’t need to like or agree with the choices that the spouses make; rather, I need to ensure that they have enough information to make their decisions.

In this example, the clients have reviewed their expenses and income, assets and debts. They are both informed, which means that I have done a big part of my job.

[Note: I would probably ask Wife about other potential sources of money, if she were to need it; and, raise the possibility of her meeting with a financial expert. I might ask whether it would be possible for her to speak with her boss about the chances of getting that raise she is expecting, and if such a meeting would make sense for her. But it is the parties – in this case the Wife – who answer these questions and decide what to do.]

Next time:  What if a client refuses to provide information?

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Nice house. Great price! But, did you know about the airport? Informed-decision making in mediation(Part 1)

Almost everyone, I would think, is willing to put in time and effort before buying a new home.  There are a lot of questions to be answered:  What condition is the house in? What is the neighborhood like? How are the schools, shopping and public transportation? Are houses of worship nearby? And so on. A house that you would consider ‘a steal’ at the price of one million dollars might seem overpriced at $200,000, if you were to learn that a waste-treatment plant or airport is about to be built just up the road.

You would want to know about that new development, right?

The point is that, when making big decisions, it is important to have enough information so that the decisions will be good ones. In a divorce, spouses are often making some of the biggest decisions of their lives, in many cases including ones about their home. Fortunately, in divorce mediation, ‘informed-decision making’ is a pillar of the process, and my next few blogs will be devoted to this subject.

As I’ve discussed in another post, it is the parties who make the decisions in mediation, and not the mediator. But as a mediator, I work with clients so that their decision making is ‘informed’.

What does this mean?

Example: Husband and Wife meet with me. It is their first session.

  • Wife says to me:  We have a house that we bought when we got married. I’ll be buying him out, and paying him a million dollars.
  • Husband says:  Yeah, that’s what we’ve decided on.”

As their mediator,do I have a problem with their agreement?

No, at least not yet.

So should I respond by saying, “That’s great! Let’s move on to the next issue.”?

No!

Why not?

Because by doing so, I wouldn’t be checking with the parties as to whether their decisions are informed.

So, I’ll ask them questions perhaps beginning with:

  • How much is the house worth, and how did you come up with that amount?
  • Is there a mortgage, and if so, for how much?
  • (to Wife) Where will you get the money to buy your husband out?

Next time:  More questions that I’m likely to ask clients; and, working with spouses who have solid answers.

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But I’ve known one of the parties for years . . . How can I mediate with them? (Part 2)

In my previous post, the questions are posed: Can a mediator act impartially in a case if s/he already knew one of the parties before they come to the mediator’s office? Should the mediator automatically refuse such a case? Because, if a mediator already knows one of the people, won’t s/he have already formed an impression or made judgements, and so be biased?

Authors/mediators Gary Friedman and Jack Himmelstein have written that:

The question for us as mediators isn’t how to avoid judgments [about the parties]. It is what to do as they arise, which they inevitably will, to keep them from blocking or limiting our effort to be fully present for each party.

What’s required is that the parties are satisfied that the mediator can be neutral “through ‘being there’ for both of you in order to help you.

I’ll want to understand what is important to both of you under your dispute, and help you understand yourselves, and possibly each other more fully. If I’m going to do that, you both need to have confidence that I haven’t already chosen sides and that I’ll never do that as part of this process.

And if at any time any of you feel that I’ve moved off my neutral position, and become partisan in the sense of being or appearing to be more on one side than the other, I’d want you to bring it up in the mediation.

In the particular case that the authors are referring to, each of the parties to the dispute had a lawyer representing them. Perhaps the attorneys could have assisted or ‘protected’ their clients if the mediator had strayed from his neutral role. But, whether or not clients have retained attorneys, I think the principle is the same. Can the mediator work in the same manner with the different parties, trying to help each to the best of his ability, and in a way that is fair and satisfactory to them, even if the mediator knew one of the parties beforehand?

Perhaps I should say that I have never had such a case in my own practice, very likely because knowing one of the parties, I would never had considered it. But I find the authors’ views persuasive; what they say here intuitively makes sense to me. There have been several occasions over the years when I’ve felt that I could have helped them, despite having known one of the parties in some way in the past.

Would I ever take such a case? The answer would depend, in part, on my relationship with the parties; I would need to be convinced of my own ability to act fairly.  I would have to disclose the nature of my relationship with them, so that both (or all) would be fully informed.  I might ask them to take some time to further think over the question; and, if they were to come back and say, “We understand that you knew one of us before, . . . (or, “I understand that you know her better than you know me, . . .), but we feel that you won’t take sides,” I might well accept the case.

And, I can see how it could go very well.

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Yeah, it’s Voluntary; What else is Mediation? Impartial

In my previous post, I began to discuss what the process of mediation is, and explained that it is voluntary.  Mediation is also:

  • Impartial (some use the word neutral)
    • As a mediator, I work with both (or all) of the parties.  I work to understand each person, and to help them consider and speak about what s/he wants and needs for the future.  In the context of divorce, this often means talking about a place to live and how to pay for this and other expenses; and, if there are children, about spending time with them, and making decisions in regard to raising and caring for them.
    • I do not represent either (or any) of the parties; representing one party against another is something a lawyer often does.  Again, as a mediator, I work with all of the parties, helping them to gather and share information, to develop and consider options for going forward, and ultimately in reaching their agreements.
    • My role is to help the parties to communicate constructively, to guide them in considering and addressing all of the issues that they need to, to ensure as I am able to that their proposed agreements are workable (reality testing), etc. Without taking anyone’s side.

To be continued . . . .