Binding Arbitration, Voluntary Trial Resolution, and Med-arb Proceedings in Family Law
Mediation has become the most widely accepted alternative dispute resolution procedure in family law cases.1 Although most mediations in the family law context are successful and result in a partial or total resolution, there exist scenarios in which the parties are emotionally incapable or unwilling to resolve their differences in this informal setting. As such, other dispute resolution processes, such as binding arbitration and voluntary trial resolution, should be implemented in appropriate family law cases either apart from or in conjunction with mediation.
This article will discuss what is known as a “med-arb” proceeding and how it can be used to promote an efficient and less expensive resolution of many family law disputes. In essence, binding arbitration or voluntary trial resolution can be used in conjunction with mediation to promote public policy favoring alternative dispute resolution so as to avoid undue expense, delay, and the unnecessary exacerbation of negative emotions, which commonly result in contested family law cases.2
In this article, mediation and binding arbitration (or voluntary trial resolution) are separately discussed as a backdrop to a discussion of med-arb. The med-arb procedure will then be discussed in the context of when and under what circumstances it can or should be used.
Mediation as a Preferred Methodology
Mediation is a process whereby a neutral and impartial third person acts to encourage and facilitate the resolution of a dispute without prescribing the outcome. The mediation process is informal, nonadversarial, and voluntary. It is an informal process intended to help disputing parties reach a mutually acceptable agreement.3 The ultimate decision-making authority remains with the litigants who are encouraged through negotiation and self-determination to reach an acceptable agreement. The mediation process allows the parties to resolve their own issues instead of letting an unrelated third party, such as a judge or arbitrator, resolve their issues for them, which, although somewhat counter-intuitive, is our system’s ultimate and final answer to a failed alternative dispute resolution attempt.4
Mediation is generally governed by F.S. §§44.102, 44.106, 44.107, 44.401 through 44.406 (2007), Rules 1.700 through 1.730 of the Florida Rules of Civil Procedure, and Parts I and II of the Florida Rules for Certified and Court-appointed Mediators. More specifically, Rules 12.740 and 12.741, respectively, of the Florida Family Law Rules of Procedure govern family law mediation.
Rule 12.740(b) of the Florida Family Law Rules of Procedure provides: “All contested family law matters and issues may be referred to mediation.” The permissive wording of the rule has, in effect, become mandatory as a result of local rule, administrative order, or otherwise.5 It has already been implied that emotional impediments sometimes prevent a successfully mediated resolution. Scenarios exist when mediation has little chance of success due to the facts, litigious attorneys, nonengaged mediators, and litigants who find the contested judicial process therapeutic, or because of a combination thereof.
Effectuating a Successful and Meaningful Mediation
There are five major components of the mediation process: the parties, their attorneys, and the mediator.6 All five “players” must approach the mediation conference with a positive attitude in order to perfect a meaningful result. A brief discussion of each participant’s involvement is necessary in order to emphasize his or her role and responsibility.
The real parties in interest are, of course, the parties themselves. Most mediation in the domestic relations context only involves two parties. It is imperative that the parties be motivated to resolve their issues. All too often the parties lack the motivation to amicably resolve their issues because an attorney has “stirred the pot” for self-serving reasons; one or both of the parties view the process as somewhat therapeutic; or the parties have simply not been adequately prepared for mediation by their legal representative. The parties must be thoroughly prepared by their attorneys prior to the mediation conference. Unfortunately, it is not unusual for a party to appear at mediation with little or no preparation.
Attorneys must a) complete sufficient discovery prior to and not at the mediation conference; b) engage in a thorough preparation of risk analysis with their client prior to mediation; and c) have a positive attitude toward the process of mediation and encourage their client to engage in meaningful settlement discussions.
Mediation should not be a conduit through which discovery is perfected. Engaging in an exchange of discovery at the mediation conference shows lack of preparation, which is a disservice to the client and to the process itself. No attorney or client can adequately prepare for or engage in constructive risk management if discovery is incomplete prior to the mediation conference.
Unfortunately, some attorneys may only marginally engage in a mediation conference and defer to the mediator to engage in risk analysis directly with the client. Such a dilatory practice is lazy at best and dangerous at worst. Consider the consequences should the mediator be unskilled or simply be a “message carrier.” Attorneys too frequently defer to mediators to analyze risk with their difficult clients instead of digging in and facilitating the negotiation process. Getting the attorney “off the hook” is not within a mediator’s job description.
The attorneys should review with their clients the notice of mediation conference prepared by the mediator. Ideally well before the meditation process begins, the parties should be advised that third parties are not allowed in a mediation conference in the absence of the consent of the other party or prior court order.7 The clients should also be aware of his or her financial responsibility to the mediator. Lastly, appearances by parties via telephone at mediation should be minimized in order to maximize the chances of an amicable resolution. It is always difficult to discuss settlement with a party via telephone or other electronic means, which lack the interpersonal advantage of face-to-face contact with the mediator. An effective process includes the mediator and attorney’s ability to assess the parties’ nonverbal communication.
In order to have a successful mediation, the attorneys representing the parties must have a positive attitude toward mediation. To arrive at the mediation conference and simply “draw a line in the sand” at the outset is also a disservice to the client and to the process itself. The client should be forewarned by his or her attorney and the mediator as to the damage that will result in proceeding to a contest or adversarial proceeding and allowing a third party to superimpose his or her rules on the parties themselves. It is incumbent on the attorneys to instill in their clients a positive attitude with respect to settlement prior to and at mediation.
The fifth component part of the mediation is the mediator. The mediator should prepare and familiarize themselves with the issues well in advance of the mediation conference. Reviewing the pleadings, temporary orders, evaluations, and/or pertinent depositions prior to the conference is important. The mediator becomes vested in the process having become familiar with the issues beforehand. There is greater possibility that the parties will become vested in the process knowing the mediator is prepared. The mediator must also identify with what the parties are experiencing emotionally or otherwise. Establishing a bond with the parties is essential to gaining their trust. If the parties perceive the mediator as uncaring, the mediator loses effectiveness in assessing risk. The mediator should be knowledgeable of the law applicable to the issues as a lack of knowledge of the law impairs the mediator’s ability to risk assess. Lastly, the mediator should prepare to stay at the mediation conference as long as necessary to effectuate a resolution. Any previously scheduled personal commitments of the mediator should never impede the momentum of settlement negotiations. If a mediation conference adjourns without a settlement agreement, all momentum is lost and the parties typically regress from their last offer or counteroffer and begin positioning themselves for the adversarial process.
Declaring an impasse should be the last option. In the family law context, the entire family unit loses no matter which party prevails. If everyone at mediation is positive, creative, and possesses a sincere desire to constructively discuss resolution, such damage can be averted and the emotional and psychological toll of the breakdown of relations minimized. This article also pertains to situations when both parties are pro se or only one of the parties is represented by counsel. There might even be more than two real parties in interest attending mediation, such as in surrogacy situations or cases involving third-party custodians of children. In any event, the same concepts apply to any family law factual scenario in which the chances of a successful mediation can be maximized.
Although arbitration or voluntary trial resolution has not historically been a preferred alternative dispute resolution process in family law cases in Florida, the expanded use of binding arbitration or voluntary trial resolution alone or, better yet, in conjunction with mediation is certainly worthy of consideration in nonchild-related family law cases in the event of impasse.
Binding Arbitriation or Voluntary Trial Resolution as an Alternative
Unlike mediation, arbitration as defined in F.S. §44.1011 (2007) is a “process whereby a neutral third person or panel … considers the facts and arguments presented by the parties and renders a decision which may be binding or non-binding….” The primary advantage(s) of binding arbitration or voluntary trial resolution in nonchild-related family law cases is the “high degree of conclusiveness (which) attaches to an arbitration award (so as) to avoid the expense and delay of litigation … the arbitrator (or arbitration panel) or private judge is the sole and final judge of the evidence and the weight to be given to it.”8
F.S. §44.104 (2007) provides for voluntary binding arbitration and voluntary trial resolution.9 Family law cases are not exempted from these alternative dispute resolution processes except as set forth later in this article. The beauty of the arbitration or voluntary trial resolution process in the family law context is the finality of the result. The ability to appeal a binding arbitration award is limited to the specific reasons set forth in F.S. §44.104 (10) (2007).10 As a practical matter, it is extremely difficult to overturn a voluntary binding arbitration or private judge award. Other advantages of the current version of F.S. §44.104 include, but are not necessarily limited to, speed of the process, privacy (which attaches to a noncourtroom legal proceeding), comfort of the setting, freedom of schedule, and the positive effect on the judicial system of reduced congested dockets.11
F.S. §682.13 (2009) provides that a binding arbitration award or voluntary trial resolution must be confirmed unless there is corruption, fraud, arbitrator bias/partiality, or a procedural defect that substantially prejudices the rights of a party. The arbitration of a family law issue in an appropriate case must be conducted pursuant to the consent or agreement of the parties.12 As a practical matter, parties who wish to submit to binding arbitration or voluntary trial resolution in the family law context simply agree upon an arbitrator or private judge whose responsibility it is to bring closure to the situation.13
Given the separate idiosyncratic benefits of mediation and arbitration (or voluntary trial resolution), a hybrid alternative dispute resolution process known as “med-arb” has developed. Although the hybrid approach has historically been used in the commercial law context, the med-arb process may successfully be utilized in family law cases when 1) the case is first referred to mediation pursuant to local practice, applicable rule, or statute; 2) the mediation is not successful; and 3) the parties then voluntarily submit their remaining disputed issue(s) to binding arbitration or private judge.
Med-arb in Family Law Context
Med-arb is short for “mediation-arbitration,” which is a two-step alternative dispute resolution process involving both mediation and arbitration. The parties first attempt to resolve their issues in mediation. If mediation fails in resolving all or some of the issues, then remaining issues are automatically submitted to arbitration (or to a private judge). Med-arb may involve the same “neutral” (objective facilitator) or two neutrals, one neutral to conduct the mediation, and the other neutral to conduct arbitration. The goal is to maximize the parties’ chances of reaching a negotiated settlement with the understanding that any unresolved issues will be finally decided in the arbitration or voluntary trial resolution context by a third-party decisionmaker.
The resolution of family law issues through med-arb has so far been the exception and not the rule. Family law practitioners are reticent in exhausting creative dispute resolution alternatives consistently. However, increasing trends toward the use of alternative dispute resolution processes such as med-arb promote finality, efficiency, and cost savings while limiting ongoing acrimony. The limited use of med-arb in family law cases has produced few appellate decisions from which to discuss its parameters. Two recent decisions are discussed herein.
In Toiberman v. Tisera, 998 So. 2d 4 (Fla. 3d DCA 2008), the Third District Court of Appeal held that it was plain error for the trial court to delegate its judicial authority to an arbitrator (or arbitration panel) to decide matters relating to child custody, visitation, or child support given the proscription as set forth in F.S. §44.104(14) (2006).14 In simpler terms, a case involving minor children cannot be referred to binding arbitration given the present statutory language. Toiberman concerned an original dissolution of marriage proceeding submitted to binding arbitration pursuant to the consent of the parties after a failed mediation.
The Toiberman court applied the plain language of F.S. §44.104(14) in overturning the trial court’s order approving an arbitration award. The court scrutinized F.S. §44.104(14) (2006) (voluntary binding arbitration), which provides, “This section shall not apply to any dispute involving child custody, visitation, or child support, or to any dispute which involves the rights of a third party not a party to the arbitration.” The Third District reasoned that a 1) “dispute” as set forth in the statute refers to the entire action between the parties and not to individual issues, and 2) the legislature intended to exclude from arbitration cases even tangentially involving minor children, who are obviously not parties to the lawsuit. As a result, the arbitration award was vacated and the case was remanded to the trial court to exercise its judicial authority.
The factual scenario in Martinez v. Martinez, 35 Florida Law Weekly D2270 (Fla. 3d DCA 2010), addressed a post-judgment action brought by the former husband. The Martinez final judgment of dissolution of marriage incorporated a “children’s agreement” resolving child custody and visitation as well as an “assets agreement” resolving the party’s financial issues. The parties agreed to submit to arbitration any future disputes regarding either agreement. Unfortunately, issues developed post-judgment, which resulted in the former husband invoking the arbitration provision(s).
Notwithstanding the “children’s agreement” and “assets agreement” and prior to arbitration commencing, the former wife requested that the trial court exercise its jurisdiction alleging that the arbitration provision in the marital settlement agreement was unenforceable by violating F.S. §44.104(14). The former husband responded alleging that 1) the issues were post-final judgment, and 2) the dispute involved financial issues only.
Relying on the rationale in Toiberman, the Third District Court of Appeal rejected the former husband’s position and affirmed the trial judge’s order that the arbitration clause was unenforceable. The proscription on arbitration in family law cases involving minor children applies equally to initial dissolution proceedings as well as post dissolution proceedings. The court reasoned that a decision on any financial issue in a family law case could indirectly (as well as directly) affect a party’s ability to comply with provisions relating to child timesharing and/or child support. As such, binding arbitration cannot be used in any family law case involving minor children even if the only controverted issue(s) seem to relate solely to the parents.
The advantages of med-arb in nonchild-related family law cases include a) the reduced cost of using a streamlined process; b) enhancing the parties’ control over the entire process by assuring finality either through a voluntary settlement or binding arbitration; and c) achieving finality within a reasonable period of time.15
The Applicability and Appropriateness of Med-arb Proceedings
Under existing law, med-arb proceedings are only appropriate in cases in which no minor children are involved, i.e., the marriage is childless or the children are sui juris.16 Should mediation fail to resolve financial (including support) or property issues in an appropriate initial or post-dissolution family law case, then submitting any unresolved issues to binding arbitration or voluntary trial resolution, either apart from or in conjunction with mediation, could very well be the most efficient and cost effective way of effectuating an expeditious and efficient resolution of the dispute. As previously noted, the grounds to overturn arbitration or private judge awards on appeal are very limited. In the family law context, the time and expense of submitting issues to arbitration should be substantially less than in protracted court proceedings. The litigants can resolve their issues in a less formal and more relaxed atmosphere, which theoretically should result in less acrimony, expense, and time consumption.
Med-arb is most appropriate in cases involving collateral issues not otherwise resolved through mediation or direct negotiations between the parties.17 Enforcement issues which would otherwise burden the court or are in need of quick resolution would also be proper subjects for arbitration, voluntary trial resolution, or if need be, med-arb. “Childless” monetary set-off cases, initial dissolution of marriage cases, or post-judgment cases in need of time and cost efficiency would be appropriate for med-arb. Of course, if the issues resolve during the mediation process, then binding arbitration or voluntary trial resolution would not be necessary. If mediation fails, the parties could then proceed directly to arbitration or a private judge where an arbitrator, arbitration panel, or private judge would render the final decision virtually immune to appeal.
In appropriate family law cases, binding arbitration, voluntary trial resolution, or med-arb provide viable options to formal court proceedings. The problems encountered in complex commercial litigation cases referred to arbitration should not be of significant concern in family law cases in which funds to litigate are usually much more limited.18 Used appropriately and in the correct context, arbitration, or voluntary trial resolution, and/or med-arb could prevent and/or finally resolve any “holy deadlock.”19 More family law practitioners should consider using arbitration or private judging alone or in combination with mediation in appropriate cases as viable tools to facilitate a final and comprehensive resolution. The following limerick titled “The Last Straw,” as amended by the author, puts things in their proper prospective.
And so we’ve reached the end,
I’ve kidded foe and friend,
but I’ll attest
it’s all in jest;
I hope I didn’t offend.
I’ve written what I knew from a lawyer’s (mediator in this case) point of view.
Just let me add
in case you’re mad
please don’t decide to sue!20
1 Knowlton & Muhlhauser, Mediation in the Presence of Domestic Violence: Is it the Light at the End of the Tunnel or is it a Train on the Track?, 70 N. Dak. L. Rev. 255 (1994). Although there are exceptions to referring cases involving issues of domestic violence to mediation, there is no bar. Depending on the effectiveness of the attorneys and the mindset of the litigants, mediation may yield a healthier and more empowering experience than putting parties before a judge.
2 Uniform Mediation Act, as approved by the ABA (2003).
3 See Fla. Stat. §44.1011(2) (2012).
4 Allowing an unrelated third party, such as a judge or arbitrator, to superimpose his or her ideas on the family unit may seem repugnant to a litigant. Ideally, the litigants themselves should determine the rules by which they will abide in the future.
5 See, e.g. , Administrative Order No. 2011-006 PA/PI-CIR from the Sixth Judicial Circuit in Florida, which defines and establishes standards for the Sixth Circuit mediation programs.
6 This article assumes that there are two parties in a mediation conference, each having attorney representation.
7 Nonparty attendance in a mediation conference in the absence of the consent of the other party is set forth in MEAC Adv. Op. 2008-006 (Fla. Sept. 15, 2008); Fla. Stat. §§44.403(2) and 44.405(1); Rules 10.310(a) and 10.420, Florida Rules for Certified and Court-appointed Mediators.
8 The methodologies for selecting arbitrators or arbitration panels in the context of contractual or commercial law disputes need not apply in family law cases.
9 Nonbinding arbitration is provided for in §44.103 (and its sub-parts). Nonbinding arbitration in family law cases is not the subject matter of this article, which is specific to a nonrecourse methodology in which appellate or further judicial intervention is minimized.
10 An appeal of a voluntary binding arbitration decision shall be taken to the circuit court and shall be limited to review of the record and not de novo, if a) any alleged failure of the arbitrator to comply with the applicable rules of procedure or evidence; b) any alleged partiality or misconduct by an arbitrator prejudicing the rights of any party; c) whether the decision reaches a result contrary to the constitution of the United States or the State of Florida.
11 Of course, the advantages of resorting to arbitration or private judging can be weighed against any possible disadvantages, such as cost and lack of transparency. Sheila Nagacas, The Marriage of Family Law and Private Judging in California, 116 Yale L. J. (2007); John Dooling, Alternative Dispute Resolution and the Private Judge, Res Ipsa Loquitur 47 (1990).
12 Fla. Stat. §682.03 (2009) (“This sub-section shall not apply to any dispute involving child custody, visitation, or child support….”).
13 More complex methodologies for selecting an arbitrator or arbitration panel, such as is complex in the contractual or commercial law dispute context, need not apply in family law cases. The idea in the family law arena when funds are typically limited is to simplify, not exemplify. Arbitration panels in family law cases should be the rare exception.
14 The gravamen of the court’s rationale obviously is predicated upon the stated public policy and case law that a court cannot delegate its authority to nonjudicial arbitrators in cases involving minor children who are not present to represent their own interests in any judicial-related proceeding.
15 Mills and Brewer, Med-Arb Process Can Help Settle Disagreements, Puget Sound Bus. J. (1999).
16 Proposed changes to Fla. Stat. §44.104 would specifically remove the exemption of issues concerning child custody, visitation, or child support. However, the proposed statute regarding dispute resolution “does not apply to any dispute that involves the rights of a third party not a party to the voluntary trial resolution….” Should the proposed statute ever become law, then the question arises as to whether the binding arbitration or voluntary trial resolution does or does not apply to cases involving minor children. Inasmuch as the proposed statute is not the subject of this article, please refer to S.B. 1458, Reg. Sess. (Fla. 2012). The bill died in the Governmental Oversight and Accountability Committee on March 9, 2012.
17 Although not codified in a rule or statute, direct negotiations between the parties is generally considered the most informal and widely used alternative dispute resolution process.
18 Hauser, Kramer & Leonard, Re-examining the Presumption in Favor of Arbitration and Complex Commercial Cases, 84 Fla. B. J. 8 (2010).
19 A. P. Herbert, Holy Deadlock (1934) (The author addresses in a satirical novel the inadequacies of English divorce law. Mr. Herbert characterized divorce as “a relief from misfortune, not a crime.”).
20 Edward Siegel, Just Like a Lawyer, The Best and Verse of the Law in Rhyme and Limerick at 143 (1993).
Ned I. Price practiced trial law for 28 years with an emphasis on family law. He is presently a certified family law and circuit civil mediator primarily mediating family law issues. He received his master’s degree in philosophy from the University of South Florida in 1976 and his J.D. from Stetson University College of Law in 1978.
This column is submitted on behalf of the Family Law Section, Carin Marie Porras, chair, and Sarah Kay and Monica Pigna, editors.