Alternative Dispute Resolution Act

Summary

The Multi-Door Courthouse Act provides parties to a lawsuit with choices for resolving their dispute that save time and money, when compared to formal court proceedings, by encouraging alternative dispute resolution (ADR) procedures – limited discovery, confidential proceedings, and nonjudicial assistance in evaluating the parties’ claims. The Alternative Dispute Resolution Act permits the parties to choose from a variety of alternative dispute mechanisms, including early neutral evaluation, mediation, arbitration, minitrial, and summary jury trial. Although the parties may elect from an assortment of ADR procedures, they are not required to do so. This voluntary approach avoids the danger of creating an additional, and costly, barrier to justice in those instances when ADR is inappropriate.

Model Legislation

Section 1. {Title.}

This Act shall be known as and may be cited as the Alternative Dispute Resolution Act.

Section 2. {Creation of multi-door courthouse for use of alternative dispute resolution procedures.}

 (A) The Chief Justice shall establish within each court of general jurisdiction an alternative dispute resolution program not later than six months after the effective date of this Act. Such program shall include an alternative dispute resolution plan.

(B)  The alternative dispute resolution plan shall include, but not be limited to:

(1) Procedures for limited discovery;

(2) Confidentiality of proceedings as to possible subsequent pretrial and trial actions; and

(3) The selection, use and payment of nonjudicial personnel, also referred to as neutrals, mediators, or arbitrators, who may conduct alternative dispute resolution procedures.

(C)  The plan shall also establish standards for determining which cases are appropriate for alternative dispute resolution, considering such factors as whether factual issues predominate over legal issues, whether the cases involves complex or novel legal issues requiring judicial action, and any other factors the court considers relevant.

(D) Each judge shall conduct a conference with counsel within 120 days after a complaint is filed to review voluntary alternative dispute resolution procedures that may be used in lieu of litigation to resolve the claims in controversy.

(E)  Each plan shall authorize the parties, if they so choose, to utilize alternative dispute resolution procedures that may be used in lieu of litigation to resolve the claims in controversy.

(1) These voluntary alternative dispute resolution procedures shall include, but are not limited to, early neutral evaluation, mediation, outcome-determinative mediation, minitrials, summary jury trials, and arbitration.

(2) Outcome-determinative mediation under this section means a procedure in which either a single mediator or a panel of three mediators selected by or under the direction of a court provides the parties with a dollar amount determination that the mediator(s) believe(s) would be awarded if the case were tried.

(F)   The parties may choose to utilize the alternative dispute resolution procedures and neutrals made available by the court or may, if all parties and the court agree, utilize the service of other neutrals not designated in accordance with the court’s alternative dispute resolution plan.

(G) Each plan shall also provide that if the parties choose outcome-determinative mediation and in the event a determination is reached:

(1) Any party may give notice that it intends to accept that determination, while the other parties remain free to reject the determination and continue with the litigation;

(2) A plaintiff in an action seeking monetary relief, who rejects the determination and fails to obtain a final judgment that is at least ten percent greater than the determination, shall pay the defendant’s reasonable costs and reasonable attorneys’ fees incurred after the rejection of the determination; and

(3) A defendant, in an action seeking monetary relief, who rejects the determination and fails to obtain a final judgement that is at least 10 percent less than the determination, shall pay the plaintiff’s reasonable costs and reasonable attorneys’ fees incurred after rejection of the determination.

 Section 3. {Implementation.}

In carrying out its plan, the court is authorized to utilize the volunteer services of non-judicial personnel (also known as neutrals, mediators, or arbitrators) to conduct alternative dispute resolution procedures. The Courts are also authorized to establish and pay the amount of compensation, if any, that each neutral shall receive for services rendered in each case.

Section 4. {Severability clause.}

Section 5. {Repealer clause.}

Section 6. {Effective date.}

 Approved by ALEC Board of Directors in 1995.

Reapproved by ALEC Board of Directors on January 28, 2013.

Keyword Tags: ADR

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