Critique of Third-Party Decision-Making in ADR Processes

By B, Ira | Dispute Resolution Journal, August 1998 | Go to article overview

Critique of Third-Party Decision-Making in ADR Processes


B, Ira, Dispute Resolution Journal


Are some third-party ADR mechanisms, including arbitration, in danger of "replacing one judge for another?" asks author Ira Lobel. He also inquires, "are some arbitrators making decisions as to what the law should be?" Acknowledging there are "many cases where a third party can help the parties reach a settlement," Lobel argues that in matters of legal rights (in contrast to contract rights), such an approach may not be in keeping with public policy. Comments from readers on this opinion are encouraged.

The author is commissioner of the Federal Mediation and Conciliation Service and has been a mediator with that organization since 1974. In addition to his primary work in the labor field, he has also conducted numerous regulatory negotiations and other efforts in the field of alternative dispute resolution. The views expressed are his own and do not reflect those of the Federal Mediation and Conciliation Service. Growing dissatisfaction with our legal system has been the catalyst to much of the development in the alternative dispute resolution (ADR) arena. Discontent with the adversarial nature of our legal system, together with its high costs and long delays, have influenced many dispute resolution practitioners to develop new systems and processes to deal with day-to-day problems. Advocates for ADR processes maintain that mechanisms should be developed by courts, regulatory agencies, and other organizations to allow disputing parties access to new and more meaningful avenues for settling their disputes.

This article will focus on the ADR programs in which a third party makes a decision, whether formal or informal. Various approaches including arbitration, early neutral evaluation, mini-trials, and other third-party mechanisms have all been used in an effort to reduce court calendars, pare legal costs, and provide a more economical and faster system of justice.

Unlike the mediation process in which the parties retain their authority to settle cases, these ADR decision-making processes involve a neutral third party actually rendering a decision on the matter before it. Whether the decision is formal or informal, binding or advisory, a third party is making a determination on the merits of the case.

Numerous private businesses have been developed to "rent a judge," where parties to a dispute agree to use a former judge or some other mutually acceptable third party to make an expedited ruling on the dispute. The parties often agree to be bound by these "advisory" rulings.

Many of these third-party processes merely substitute one third-party decision-maker for another; if so, is this really an alternative approach, or just a different third-party decisionmaker? Equally important, it could be argued that these ADR processes foster the development of a private system of justice, together with a potential lessening of access to the system, ensuring public-policy concerns are met, costs, etc.

Most of these concerns are not present in the mediation process in which a neutral helps the parties reach an agreement. It is really an extension of the negotiation process. The "decisionmaking" processes mentioned above provide a different decision-maker for negotiations and have a fundamentally different character.'

Dissatisfaction with the Current Legal System

In any discussion involving the legal system and ADR, the assumption is that the present system of decision-making involving lawsuits and administrative determinations is neither effective nor efficient. People talk constantly about the frivolous cases being filed, the long delays in litigation, the tremendous costs, and, at times, the bizarre results as incontrovertible evidence that the current legal system is not working.

In all of this discussion, it is assumed that, because the legal system has become so timeconsuming, costly, and combative, it is the decision-making part of the legal system that must be changed, modified, and adapted. …

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