Mediation, whether court-connected or private, involves facilitated negotiations by an impartial third party. The mediator helps disputing parties reach voluntary, fully informed, and mutually acceptable results. Mediation attendance may be voluntary or court-mandated. However, the outcome is binding only if the parties reach agreement and incorporate their settlement terms into contracts or court documents.
In this article, I will discuss the ethical standards and limits of the New Jersey mediator’s role. I will also compare and contrast the identified bodies of governing rules and standards for New Jersey mediators. Finally, I will raise certain ethics issues that are novel and unresolved at this point in the professional growth and development of mediation in our state.
II. Sources of Mediation Standards and Ethics
New Jersey professional mediators now have four key sources for ethical guidance and “best practices.” These are:
1. New Jersey’s Uniform Mediation Act, N.J.S.A. 2A:23C-1, et seq. (“UMA-NJ”), signed into law on November 22, 2004.
2. New Jersey Association of Professional Mediators’ (“NJAPM”) Code of Professional Ethics, published at www.njapm.org.
3. New Jersey Supreme Court’s Standards of Conduct for Mediators in Court-Connected Programs (“Supreme Court Standards”), published on February 16, 2000, and available on the New Jersey Judiciary’s website, www.judiciary.state.nj.us/services/cdr.htm.
4. Rule 1:40-4(a) through (g), Rules Governing the Courts of the State of New Jersey.
Among these varied bodies of ethics rules and standards, the UMA now stands in front of the pack. It represents the most sweeping declaration of mediation public policy in New Jersey’s history, and, with limited exception not important to discuss here, purports to govern both private and court referred mediations. The Supreme Court has yet to agree to some of the UMA’s provisions, although the Court is unlikely to challenge the most controversial sections of the law, namely the Legislature’s creation of a series of privileges against disclosure of mediation communications.
The standards and rules governing court-connected Complementary Dispute Resolution (CDR) programs, identified as items 3 and 4, above, cover self-determination of the parties, mediator impartiality, mediator conflicts of interest, mediator competence, confidentiality of mediation communications, mediator qualification and training, termination of the mediation process, and mediator compensation. They prioritize relevant principles for mediators, legal counsel, and parties, and answer questions of fundamental importance to all of the players.
The UMA-NJ may have superseded some of those identified standards, policies, and rules, in whole or in part, but most of them remain intact, as I will discuss below.
NJAPM’s Code of Professional Ethics is binding on its members and, like the Supreme Court’s Standards, tells NJAPM’s Accredited Professional Mediators (“APM’s”) exactly what is expected of them. However, unlike the Court’s Standards, NJAPM’s by-laws expressly make APM’s subject to investigation and discipline, upon consumer complaint, for breach of the Code.
III. Quality of the Mediation Process, Impartiality, Disclosure of Conflicts, Future Associations
Apart from requiring mediators to remain impartial, protective of mediation communications, and free from undisclosed conflicts of interest, the UMA-NJ is silent as to the quality of the mediation process itself. While not directly discussing or describing quality of process issues, NJAPM’s Code of Professional Ethics gets there through the back door. It describes the role of the mediator, expected training, disclosure of conflicts, future associations by and between mediators and former mediation clients, parties’ encouragement to obtain independent counsel, and the contents of a memorandum of understanding. However, it is in the section called “Mediation Retainer Agreement” that NJAPM elaborates on what it takes to provide a fair and impartial process, largely by describing what is and is not to be included in both the retainer agreement and the process it describes:
- Advisability of obtaining independent legal counsel.
- Requirement of full and voluntary disclosure, failing which mediation will be terminated.
- Possible referral to other professionals, in addition to legal counsel.
- Voluntariness of party participation.
- Confidentiality of process, within legal limits, and no subpoena of the mediator or mediation records in after-litigation.
- The duty to proceed at all times in good faith and the mediator’s ability to terminate based on a party or the parties’ lack of good faith, lack of understanding, or “for any other reason deemed appropriate by the mediator.”
The Rules of Court discuss issues of compensation, confidentiality, the specific process of conducting and terminating mediations, integration of the mediation process with the underlying litigation, and mediator (and arbitrator) training and qualification requirements. However, the Supreme Court chose to leave the quality of process issues to its separately published Standards.
Principle I of the Court’s Standards emphasizes the consensual nature of mediation, that mediation is a facilitative (rather than a directive or outcome-driven) process, and that the mediator must honor the parties’ need for self-determination, full information, and informed consent.
Principle II requires the mediator to conduct mediation sessions impartially and to disclose to parties and counsel “any circumstances bearing on possible bias, prejudice, or lack of impartiality.” NJAPM has a similar disclosure requirement concerning “prior associations” as they may bear on partiality. NJAPM’s Code provision is comprehensive and well written.
Principle III deals with conflicts of interest, reasonably known, that could have a bearing on impartiality. The mediator is permitted to continue the assignment, with consent by all parties, except if the mediator believes that continuing the process would cast doubt on the integrity of the process, in which case the mediator should withdraw.
NJAPM’s Code requirements on Conflicts cover prior associations (already discussed), plus an admonition that a mediator must not function in his or her underlying professional capacity, if s/he has one, such as a lawyer, therapist, accountant, or other professional, for “either or both of the parties at any time during the mediation.” This is a helpful and appropriate warning, and a reminder that mediators should serve as facilitators and not as subject matter experts, even (and perhaps especially) if they have such subject matter expertise. This is a matter of professional self-discipline, as we often are tempted to “solve the puzzle” for our mediation clients, or to serve as their one-stop-shop-arama.
UMA-NJ is much more comprehensive and demanding in terms of the mediator’s duty to explore and disclose all reasonably discoverable sources of possible bias. N.J.S.A. 2A:23C-9 requires the prospective mediator to:
- Make reasonable inquiry to determine “any known facts that a reasonable individual would consider likely to affect the impartiality of the mediator,” including financial or personal interests in the mediation outcome “and an existing or past relationship with a mediation party or foreseeable participant in the mediation.” This provision puts an additional burden on the mediator, as it requires due diligence, and goes beyond NJAPM’s Code and the Supreme Court’s Standards. UMA-NJ encourages wider disclosure than has ever been the case in New Jersey before.
- Disclose any such known fact to the mediation parties as soon as practicable before accepting the assignment, a continuing duty throughout the mediation. NJAPM’s Code carries the same continuing obligation; the Supreme Court’s Standards do not.
It should be noted here that, unlike judicial or arbitrage decision-making, the mediator’s possible bias may be a threat to the integrity of the facilitated process, but it is not typically a direct threat to the outcome. Nevertheless, a prospective mediator’s early, accurate, and continuing disclosures are good for the public and clearly the right thing to do.
Some have asked me about the limits of initial or continuing disclosure, and my simple answer is: “There are none; disclose every conceivable relevant bias, association, and connection; put them, and the parties’ and their legal counsels’ waiver of them, in writing; and send a copy to the parties and legal counsel.” If you lose the business, then you lose it.
I have found that legal counsel and parties appreciate full disclosure. It gives people confidence to know how much integrity we mediators actually have. We should use the disclosure rules, among other things, to make a point of our scrupulous honesty and candor.
Importantly, the New Jersey Legislature chose to insert a provision in the conflicts and disclosures section of UMA-NJ that requires a mediator’s impartiality, “notwithstanding disclosure of actual or potential conflicts.” N.J.S.A. 2A:23C-9(g). In other words, we want mediators not only to appear impartial, but to be impartial. Whenever a mediator cannot so conduct a mediation, then s/he must immediately withdraw.
This precise issue came up in the Appellate Division in a case called Lerner v. Laufer, 359 N.J. Super. 201 (App. Div.), certif. den. 177 N.J. 223 (2003), a case in which NJAPM participated as a “friend of the court.” In that case, Mrs. Lerner, a former client, sued William Laufer, Esq., a certified New Jersey matrimonial specialist, for legal malpractice, alleging that his failure to protect her interests in a mediated settlement agreement had cost her millions of dollars. The trial court threw out Mrs. Lerner’s case on summary judgment, as it should have. On appeal, one of her many losing arguments was that the mediator had numerous conflicts of interest, which her lawyer did not discover, and that the mediator never should have served.
I argued to the Appellate Division that the mere fact of known conflicts of interest does not preclude one’s service as a mediator. I relied on the Reporters’ Notes to the National Conference of Commissioners on Uniform State Laws (“NCCUSL”), which stated that the person who knows the parties best, and who may have known conflicts of interest, could be the ideal mediator for those parties.
In fact, that was true in the case of the Lerner couple’s mediator, a lawyer who was a personal friend to both of them, who had represented each of them in multiple business transactions, and in whom both parties had a lot of trust. It was difficult to accept Mrs. Lerner’s position that she did not know the range of personal contacts that the mediator had with each of the parties over the years, or that such information, if truly unknown, would have made any difference to her.
Principle III and Rule 1:40-4(c) also govern future associations between mediators and former mediation clients. It is fully joined by NJAPM’s Code provision on the same topic, and has exactly the same restrictions:
- In the same or related matters involving the same parties, the mediator shall never take on an adversarial role, in any capacity.
- Within 6 months from the termination of mediation, in an unrelated matter, the mediator may take on a professional role for one of the parties to the previous mediation, but only with written consent of the other mediation party or parties.
- After 6 months, no consent is required in the immediately preceding example.
Subject to UMA-NJ’s new principles of disclosure based on public policy, Principle III, Rule 1:40-4(c), and NJAPM’s Code all provide that a mediator shall not be drawn into an adversarial proceeding as a witness and may not represent or provide professional services to any mediation party in the same or any related matter.
Importantly, in child custody and parenting time matters, Rule 1:40-5 also prohibits a mediator from later acting as an evaluator for any court-ordered report or from making any recommendations to the court regarding custody or parenting time. See, Isaacson v. Isaacson, 348 N.J. Super. 560, 578 (App. Div.), certif. den. 174 N.J. 364 (2002), in which the Appellate Division made it clear that a person serving as a guardian ad litem for children in family litigation may not also serve as the mediator for the parents’ financial disputes.
IV. Privilege, Confidentiality, and Their Limits: The Uniform Mediation Act
Among the standards, practice, and legal rules discussed above, only the UMA-NJ has created a set of privileges against disclosure of mediation communications. These privileges are the heart and soul of the UMA-NJ, which is a unique law.
NCCUSL and the American Bar Association took five years to develop the bill template. The drafters of UMA-NJ took two more years to customize it to New Jersey’s unique legal and mediation cultures. UMA-NJ therefore represents the product of many thousands of professional work hours, built upon arduous discussion, debate, and multiple revisions by the national and state dispute resolution communities.
UMA-NJ represents a significant change in New Jersey law, which previously gave no confidentiality protection and no statutory privilege regarding mediation communications in the private sector, and only limited protection in the court-referred setting. The new law protects confidentiality of communications and creates enforceable privileges for all participants and the mediator. It also:
- Broadly defines both the mediation process and protected mediation communications, for the maximum protection of participants, their representatives, and the mediator;
- Advises parties that they have the right to create their own rules of confidentiality and exceptions to privilege;
- Explicitly provides that any writings signed by the parties are not privileged or confidential, such as mediation retainer agreements and signed settlement agreements arising out of mediation;
- Establishes other important exceptions to privilege, such as when a party sues the mediator or another professional who participates in the mediation, or when communications amount to a physical threat, or present evidence of a plan to commit a crime, or evidence of child abuse;
- Creates a “Tony Soprano” waiver and preclusion of privilege for organized crime activities that take place in a mediator’s office;
- Prohibits mediators’ substantive reports to the court (unless the parties expressly agree otherwise), but allows process reports about the status of mediation, whether settlement was reached, and attendance of parties and counsel;
- Codifies that parties’ contractually agreed confidentiality provisions, as well as pre-existing confidentiality rules or laws, shall be incorporated into the mediation process. For example, Rule 1:40-4(c), in which the Supreme Court declares virtually all mediation communications protected and non-admissible, would continue to govern court-connected mediations, subject to the parties’ agreement to modify those rules, and further subject to possible public policy overrides contained in the UMA-NJ itself (discussed further, below).
- Requires mediators’ due diligence and reportage about possible conflicts of interest, which, once disclosed, the parties are then permitted to ignore; and
- Permits attorneys or anyone else designated by a party to accompany the party and participate in the mediation. (Clearly, however, the mediator retains control of the proceedings, and unruly non-party participants may be invited to leave, or the mediator may cancel the process.)
I believe that mediators now have an obligation to present these privilege and confidentiality rules and their exceptions to mediation parties and their legal counsel and any non-party participants at the beginning of mediation, in an understandable way, both orally and in writing.
Mediation is built on the twin concepts of self-determination and informed consent, and the mediator must honor both values for the mediation process to be deemed fair and impartial.
UMA-NJ substantially modernizes and strengthens the dispute resolution field here in New Jersey. It sets out clear “rules of the road” for parties and their attorneys, mediators, and trial judges, many of whom have come to expect privacy in the mediation process.
UMA-NJ now generally prevents mediation communications from leaking into later judicial or arbitration proceedings, while simultaneously permitting or requiring use of such communications in narrow circumstances when required by public policy, such as in criminal or child abuse proceedings (unless, in the latter case, Department of Youth and Family Services is a party to the mediation).
The new law is of vital importance to New Jersey’s citizens, many of whom have voiced deep and abiding concerns about the costs and delays of the adversarial system. “It takes too long and costs too much,” they say. The New Jersey court system has come to rely upon the mediation community to keep cases out of the system, to help clear up case backlogs within the system, and to winnow out newly filed cases that will not require hands-on case management, judicial intervention, or a jury trial.
UMA-NJ supports mediation as a triage tool, one that allows judges and lawyers to identify those cases that will and will not yield to a mediator’s “kinder and gentler” intervention. Parties, their legal counsel, mediators, and trial judges now have a uniform set of rules governing confidentiality of communications, so that everyone understands the rules from the get-go, whether or not mediation participants end up in court.
The New Jersey Supreme Court historically has accepted the New Jersey Legislature’s statutory creation of evidentiary privileges, and I expect UMA-NJ’s created privileges to be treated no differently. However, to the extent that UMA-NJ contains other material at variance with the Court’s own rules (both Standards of Conduct and Rules of Court), and to preserve uniformity between private sector and court-based mediations, it would be helpful if the Supreme Court agreed to adopt UMA-NJ “as is”. Our Supreme Court has been very supportive of mediation policy and practice for the past twenty years. I am optimistic that the Justices and the Committees that report to them will endorse UMA-NJ as court policy.
New Jersey was the third state to pass the UMA, behind Nebraska and Illinois. Ohio’s Governor signed the UMA into law in January, 2005, and Washington State did so in May of 2005. According to NCCUSL’s website, www.nccusl.org, a total of twelve jurisdictions may introduce this legislation in 2005. Many will look to New Jersey as a model jurisdiction for passage of this legislation, based on the high degree of bipartisan support we experienced in New Jersey, and the fact that both houses of the Legislature passed the bill without a single dissenting vote.
NJAPM’s Code of Professional Ethics requires accredited members to include specific confidentiality language in standard retainer agreements. This is a stellar idea. As mediators, we should protect the parties and ourselves to the maximum possible extent. NJAPM enjoins us to disclose
The confidentiality of the mediation process and the agreement that neither party shall subpoena either the mediator or any records pertaining to the mediation process, in the event the parties engage in subsequent litigation. The parties shall also be advised of the limits of confidentiality, including the mediator’s duty and obligations regarding the best interests of children.
Now that UMA-NJ is the law, NJAPM’s Code of Professional Ethics should be expanded considerably, as there are now many more nuances to consider under the law. For example, the current Code does not reference confidentiality as extended to non-party participants, including expert witnesses. This is a glaring hole, in light of UMA-NJ. Also, NJAPM’s Code should expressly consider that the parties may wish to negotiate for their own confidentiality rules, that may run counter to the directives of the Code, and perhaps even to those of the UMA-NJ. N.J.S.A. 2A:23C-5(a) permits parties to expressly waive their privileges, and N.J.S.A. 2A:23C-8 permits parties to waive or modify confidentiality rules. Here is an excellent example of parties’ self-determination rights extending to the mediation process itself, and not simply to mediated outcomes. As with all self-determination issues, mediators must disclose parties’ rights, in this case to process determination, before parties’ decisions will be deemed the product of informed consent.
The best time to take care of these vital process details is up front, in writing, and at the time of the initial mediation retention. If the parties’ process decisions change at any point during mediation, then such changes should also be recorded and signed. This puts additional pressure on the mediation community to conform to the dictates of public policy, but that is precisely what the New Jersey Legislature intended to do with UMA-NJ.
Before UMA-NJ, no statutes or common law principles governed confidentiality of mediation communications in the private sector; Principle V and Rule 1:40-4(b) confine themselves to confidentiality in court-connected cases only. Before UMA-NJ, Orders of Referral signed by a Judge of Superior Court covered these issues reasonably well. Following UMA-NJ’s passage, however, that is no longer true. Court-referred mediators should repeat and incorporate the Principles and Rules of Court language by reference into Retainer Agreements, record whether or not the parties chose to modify that language, and attend to signatures by the mediator, the parties, and any non-party participants (including expert witnesses). The mediator should make it clear under these policies and rules (unless the parties agree to modify them) that the parties’ mediation communications are probably inadmissible in any future court proceedings, with three exceptions.
The first exception, under R. 1:40-4(c), involves a party’s communication of proposed criminal or illegal conduct “likely to result in death or serious bodily harm.” The mediator must disclose this information to appropriate authorities if s/he reasonably believes that reporting will prevent a person’s serious bodily injury or death. RPC 1.6(b) and 1.6(c) are instructive by analogy. RPC 1.6(b) requires lawyers to divulge clients’ otherwise confidential information to “proper authorities” to prevent substantial bodily injury, death, or substantial property loss. RPC 1.6(c) permits lawyers in those circumstances to notify the person so threatened. I believe that mediators have at least the option — and perhaps the duty — to notify people (including mediation participants) of threats of serious bodily injury or death. The mediator has no obligation to report threats of substantial property loss to the authorities or to possibly affected people. As I discuss below in connection with the UMA-NJ, I believe the mediator should have no such duty.
The second limit on Rule 1:40-4(c) confidentiality is that a party is permitted to establish proof of a mediation communication “by independent evidence.” While the rule is silent as to whether the independent evidence must have been known and available before a party’s disclosure, it appears that a mediation communication could lead to a post-mediation search for evidence to prove what would otherwise be inadmissible. UMA-NJ makes the same point in N.J.S.A. 2A:23C-4(c), as follows: “Evidence or information that is otherwise admissible or subject to discovery shall not become inadmissible or protected from discovery solely by reason of its disclosure or use in mediation.” If the parties do not like that outcome, then they are free to negotiate for other confidentiality rules under N.J.S.A. 2A:23C-8.
The third exception is more complicated. Consistent with Standard V, the mediator must advise the parties of “the limits and bounds of confidentiality and non-disclosure” before mediation begins. The mediator’s early disclosure encourages the parties to communicate openly, but not so much as to damage their case if mediation fails. The mediator’s disclosure also encourages good behavior. Moreover, under developing standards of New Jersey mediation practice, I believe that a mediator’s failure to give parties and non-party participants their “mediation Miranda warnings” could amount to professional negligence. Mediators must learn the rules, their exceptions, and the ways in which the parties may lawfully modify them. We must teach them to our clients, their legal counsel, and their experts. The explanations should be clear, and the agreements should be in writing, duly signed by all, and with copies for all.
Under the UMA-NJ, N.J.S.A. 2A:23C-6, mediators, parties, or non-party participants are all subject to compelled testimony. This law will supersede contrary confidentiality provisions in private mediation settings, as well as in relevant Rules of Court and Standards, as follows:
- A threat or statement of a plan to inflict bodily injury or commit a crime is not privileged. While the Standard and Rule of Court do not presently require or permit mediator disclosure of threatened property crimes, evidence of a mediation communication indicating stated intention to commit a property crime would clearly be admissible in a criminal trial under UMA-NJ. The Standard and Court Rule do anticipate mediator disclosure to lawful authorities (and presumably to an intended victim as well) to prevent bodily injury or death. Should the Standard and Court Rule mandate mediator disclosure of property crimes? If that were to happen, and I think it should not, then parties would see mediators as an arm of law enforcement, parties’ legitimate interests in privacy would be regularly thwarted, and mediation would likely fail as a systemic alternative to divorce litigation (see Sheridan discussion, below).
- N.J.S.A. 2A:23C-6(b) provides, on a showing of good cause before the trial court, that a mediator, a party, or a non-party participant may be required to disclose mediation communications in a criminal case. The trial judge must determine, following an in camera hearing, “that the evidence is not otherwise available, and that the proponent’s need for the evidence . . . substantially outweighs the interest in protecting mediation confidentiality.”
- With the exception of the mediator (who maintains a right unique in all of privilege law to assert a non-testimonial privilege — even if the parties request the mediator’s waiver of the privilege), a party or non-party participant also may be required to testify in a proceeding on the issue of whether a settlement was in fact reached in mediation. N.J.S.A. 2A:23C-6(b)(2). When parties disagree as to whether settlement was reached, or about the content of settlement, this provision allows parties to call mediation witnesses to an enforcement proceeding, with the exception of the mediator — unless the mediator also agrees to waive the privilege (surely not a typical occurrence).
- The New Jersey Supreme Court recently decided State v. Carl Williams, 184 N.J. 432 (2005), a case of federal constitutional magnitude and the first to construe the UMA nationally. Mr. Williams, a defendant in a Superior Court aggravated assault case, wanted a municipal court mediator to testify for the defense. The alleged victim apparently admitted during mediation to picking up a shovel during a fight in which the defendant cut the alleged victim with a machete. The mediator had offered to testify for the defense, which could have been key self-defense evidence. The trial judge heard the mediator’s proposed testimony without the jury present, and then barred the mediator from testifying before the jury. The trial judge found that Supreme Court Rule 1:40-4(c) does not permit an exception to the rule against mediator testimony, even when balanced against a defendant’s federal sixth amendment right to defend himself at trial. The Appellate Division affirmed. The Supreme Court granted certification on the mediator testimony issue 10 days after the UMA-NJ became law. On July 26, 2005, our Supreme Court issued a 5-2 decision, holding that Mr. Williams’s need for the mediator’s testimony did not outweigh the public’s interest in mediation confidentiality. The Court grounded its analysis on the Uniform Mediation Act’s balancing test for evidentiary use of mediation communications, and followed the amicus curiae mediation community’s suggested statutory interpretation. The dissent, written by Justice Long, agreed with the majority on statutory analysis, but felt that Mr. Williams had made a sufficient showing of need to overcome the standard prohibition on mediator testimony.
- Some parties go to mediation precisely to avoid what are colloquially referred to as “Sheridan” problems (see, Sheridan v. Sheridan, 247 N.J. Super. 552 (Ch. Div. 1990), a case that involved ill-gotten assets and the trial court’s express duty to report the parties to the tax authorities). Under UMA-NJ, we now have an obligation to warn counsel and their clients in these situations that:
- They have the right to create their own binding confidentiality rules, to the maximum extent allowed by law, incorporating New Jersey Supreme Court Rule 1:40-4(c), and including penalty provisions for breach (which may not be enforceable as a matter of public policy).
- Their confidentiality rules and the UMA-NJ’s privilege rules may be abrogated against their wishes if criminal proceedings commence; no mediator and no mediation participant is protected at that point from having to disclose mediation communications. The risk of IRS or other tax authority’s detection and prosecution may be better than the probability of judicial turn-over at trial. It is the parties’ choice whether to proceed with mediation, knowing that what they reveal in mediation may not be concealed in future criminal litigation.
- The mediator has no disclosure duty in these circumstances, except if (A) called as a witness in a criminal trial, and (B) the trial judge makes the requisite factual and legal finding, balancing the specific needs of the defense against the general risk of harm to the public’s expectation of privacy in mediation.
Some observers nationally and in New Jersey are concerned that the privilege and confidentiality exceptions will swallow the expectation of privacy in mediation. I hope they are wrong. It will take years before we know who has the better argument. Lawyers and mediators must encourage the trial and appellate courts to interpret the UMA-NJ and the Rules of Court and Standards in ways that protect the mediation process, while also doing justice to parties in Family Part, general civil, and criminal litigation.
It is a matter of urgency that mediators get parties to decide what rules of confidentiality will govern use of expert’s reports and possible future testimony. This is a major issue, and could become a serious liability problem for mediators if not handled correctly. For example, are the parties going to retain separate experts or start out with a joint expert? Regardless of that answer, are the experts’ reports being prepared for use in the mediation only, or for after-litigation as well, should mediation fail or only partly succeed? We do not want one party saying, “The expert was a joint expert, whose report and testimony relating thereto are expressly usable by either party in court,” whereas the other party says, “The expert was mine or joint, and in any event his/her report was prepared for use solely in mediation. Either party must use a new expert for trial.” The issue should be decided up front and put into a signed writing. If litigation ensues, the document then becomes an admissible “agreement to mediate” under N.J.S.A. 2A:23C-6(a)(1). We mediators must always have our eyes on multiple process monitors: Which communications are off the record? Which are on? Do the parties’ documents so indicate?
Given the complexity generated by UMA-NJ, I have started incorporating a mandatory mediation clause in my mediation retainer agreements, if a former mediation client challenges my handling of the mediation matter and claims resulting damages. We may end up in court, but I want to make sure we try to work things out between us, with the help of a professional mediator if needed. Such a provision is both ethical and enforceable, but you should carefully review its intention and use with clients and their legal counsel at the time of retention. Most people will agree to mandatory mediation, as (A) they are already open to mediation, (B) it is not binding, and (C) either party may terminate after one meeting. It is also a way of reinforcing the value of our mediation work, of our “walking the talk.” Here is my mediation clause, if you wish to use it:
If any dispute(s) arise(s) regarding the interpretation or enforcement of any provision contained in this Agreement, then the Law Firm and you agree to attempt to resolve any such dispute(s) including fee and cost disputes, first by direct negotiations and then by mediation with a qualified professional mediator who is mutually selected by the Law Firm and you. The mediator’s fees and costs will be divided equally between the Law Firm and you unless otherwise agreed in writing at the time of mediation. After the mediation process is completed, and if any issue(s) remain(s) unresolved, than each party is free to pursue any such remedies in any processes as may be permitted or required by law.
V. Mediator Regulation: Issues of Disclosure, Unauthorized Practice, Competency, Qualification, Training, Mentoring, Continuing Education, and Compensation
Individuals from various professional disciplines are welcome to serve as New Jersey mediators, both privately and in court-connected programs. NJAPM’s Code says that mediation is a distinct discipline, separate from other professions, although mediation may be offered as a service by those professionally trained in other disciplines. Similarly, UMA-NJ expressly holds that “a mediator does not have to have a special qualification by background or profession.” N.J.S.A. 2A:23C-9(f).
The New Jersey Supreme Court, acting through two of its Committees (Attorney Advertising and Advisory Committee on Professional Ethics) issued a Joint Opinion, 676/18, in or about 1994, expressly stating that mediation practice was deemed part and parcel of a lawyer’s practice when conducted inside a traditional law firm. However, the Joint Opinion also said that mediation was not exclusively the province of legal professionals and thus properly practiced by other-trained professionals (nor was it the unauthorized practice of law by those professionals, unless they otherwise gave legal advice or held themselves out as lawyers).
In other words, New Jersey, unlike certain other jurisdictions, has taken a “let 1,000 flowers bloom” approach to mediation practice. Mediation is not a licensed profession in New Jersey, and in fact, whether we like it or not, virtually anyone may set up shop and declare himself/herself a mediator. It is strictly a case of caveat emptor (“let the buyer beware”).
Interestingly, UMA-NJ requires anyone selected as a mediator to disclose, upon request, “the mediator’s qualifications to mediate a dispute.” N.J.S.A. 2A:23C-9(c). NJAPM’s Code requires that mediators have “appropriate and sufficient formal training in the practice of mediation,” but does not require disclosure, even upon a party’s request. This should be changed to conform to UMA-NJ’s requirements.
The Supreme Court’s Standard on Competence, Principle IV, is somewhere between NJAPM’s Code and UMA-NJ on disclosure; it requires “familiarity with the general principles of the subject matter . . . being mediated”, that the mediator have “the necessary and required qualifications to satisfy the reasonable expectations of the parties,” and that s/he “shall have mediator competence information available for the parties.” The Principle never states when the mediator shall actually provide the information, if ever. The Supreme Court’s Standards and NJAPM’s Code should be revised to satisfy the UMA-NJ requirements on this point, as consumer self-determination and informed consent should extend to selection of the mediator.
Beyond ethics, I think it is fundamental and good marketing to give parties and their counsel confidence, built on legitimacy, that you are precisely the right mediator for their matter, based on your experience as a mediator and with matters similar to the one in which they have engaged your services. You may not represent those facts to be true if they are not, of course, but it is often the case that we have relevant experience to the matters in controversy. If you lack confidence or are unable to get work in a field of interest, then consider volunteering in that subject matter area for awhile, until you can state with confidence that you are prepared to serve.
Neither UMA-NJ nor the Supreme Court Standards refer to mentoring, an essential component of any professional education and accreditation process. However, NJAPM’s accreditation rules and the Rules of Court on approved list eligibility both reference mentoring requirements. Both NJAPM and the Rules of Court require mentoring as a condition of, respectively, accreditation and approval for the court list. In an ideal world, newly minted mediators, as a condition of accreditation or court approval, would be required to observe master mediators for a reasonable period of time, to ensure the incoming mediators’ professional development, as well as to be observed and critiqued by master mediators.
In the real world, creating, fostering, and reinforcing the mentoring model has proven to be very difficult indeed. The court system recently watered down its already basic mediator mentoring requirements. To encourage excellence in professional mediation practice and ethics, we need to develop a system in which people are observed, and observe others, in a clinical setting, over reasonably long periods of time, and where these interactions are videotaped and reviewed by and between mentors and mentees. NJAPM is actively considering such a mentoring plan. Until that system is in place and operating, new mediators will continue to scramble to get the review time necessary to obtain accreditation. We need to get a high quality and cost-effective mentoring program up and running.
Regarding continuing mediator education, also an issue of critical importance as it relates to experienced mediators and their need for maintenance and enhancement of skillsets, NJAPM’s Code is silent, but its rules for APM qualification are not. Accredited mediators must demonstrate 10 hours per year of continuing education credits, including units on ethics, or their accreditation will not be renewed. UMA-NJ is completely silent on CME, apart from requiring disclosure of qualification information upon a party’s request. The Supreme Court’s Standards require a mediator’s continuous improvement upon professional skills, abilities, and knowledge of the mediation process. Principle IV(C) and Court Rule 1:40-12(b)(3) require proof of 4 hours of CME per year. The Supreme Court Roster of Mediators will not stay open to those failing to meet the basic and ongoing requirements.
In the private sector, there is no State of New Jersey licensure or other required credential limiting one’s service as a mediator, and consumers must ascertain for themselves the qualifications, training, and experience of any proposed neutral. NJAPM is the only group in the State offering accreditation to qualified mediators in the areas of family/divorce mediation and commercial/business mediation. Its published accreditation and continuing education requirements are available online at www.njapm.org. These standards and credentials are important, both as a consumer tool and a marketing brand, to allow highly qualified practitioners to distinguish themselves in the marketplace and highly selective clients to identify them.
Court-connected mediators are included on an “approved” list, but the standards for getting and staying on that list are inadequate. From the public’s perspective, and that of their mediation-conscious lawyers, the Supreme Court’s list is not a relevant tool for distinguishing highly qualified mediators from unqualified mediators. The Court would do well to stiffen the standards for inclusion on the list. NJAPM generated the idea, not accepted to date, that NJAPM would become the Court’s mediator accrediting body. That would provide the Court and NJAPM with a win-win outcome. NJAPM has perfected its training, accreditation, and continuing education model for 15 years. It is a terrific wheel, not easily reinvented.
We mediators also need to pay attention to the ethics of mediator fees, costs, and billings. The UMA-NJ is totally silent on that issue. The NJAPM Code is as well, and it should not be. The Rules of Court and Standards are effusive on the topic, mostly due to the issue of “three free hours”, which hopefully will expire soon. However, the Standards also express in Principle VII that mediators’ fees must be reasonable, taking into account the subject matter, its complexity, the mediator’s expertise, the time required, and rates customary in the community. Mediator compensation shall not be contingency fee based. These standards are reasonable, and should be utilized by mediators in all assignments, whether or not court-referred. Our retainer agreements must spell out the basis for compensation, so that parties know right up front the basis and hourly rate for all time charges, and that specified costs will be added to the bills.
Court-referred mediators are heavily regulated as to what work they may and may not charge for, what travel time is and is not compensated, billing procedures, and a host of other details. On October 24, 2003, the Conference of Civil Presiding Judges published a set of Mediator Compensation Guidelines on these technical issues, which are statewide and mandatory in application.
Rule 1:40-4(b) and Mediator Compensation Guideline 15 direct that unpaid mediator bills shall be handled first by a request to the CDR Point Person in the county of venue, after which the trial court will, on its own motion, issue an Order to Show Cause, directing the parties to appear and explain nonpayment, failing which a final judgment and sanctions may be entered against the uncooperative party. This is the court system’s way of taking care of its mediators, by short-circuiting a collection process that otherwise would spawn additional litigation out of the failed mediation of an existing dispute.
Again, it would be helpful for mediators to include a dispute resolution clause in all retainer agreements, whether court-referred or private. We are better off attempting to resolve such disputes peacefully and efficiently, rather than through adversarial process.
VI. Termination of Mediation for Cause: When Is It An Option & When Required?
Termination of process is an important tool for the mediator to understand and properly exercise. It plays a key role in shaping the parties’ understanding of mediation and serves as an appropriate check on a party’s abuse of the process, another party, or (as sometimes happens) the mediator. UMA-NJ is silent on this important issue. NJAPM’s Code is very weak on this subject, stating only that the mediator “may suspend or terminate the mediation” if the mediator determines a lack of good faith by a party or the parties, if a party’s disclosure of relevant information is wanting, if either party appears not to understand the negotiations, or “for any other reason deemed appropriate by the mediator.”
Rule 1:40-4(f) states the following seven grounds for process termination, all of which are valid for court-connected or private settings. The first three permit suspension or termination at the mediator’s discretion, and the last four require termination:
1. An imbalance of power between the parties “that the mediator cannot
overcome” (Permissive termination)
2. A party’s perception that the mediator is partial to the other side. (Permissive termination)
3. A party’s abusive behavior towards the other party or the mediator
“that cannot be controlled.” (Permissive termination)
4. A party’s continuous resistance to the process or the mediator. (Mandatory termination)
5. The parties’ poor communication “seriously impedes effective
discussion.” (Mandatory termination)
6. The mediator believes that a party is under the influence of drugs or
alcohol. (Mandatory termination)
7. The mediator believes that continuing the process “is inappropriate or
dangerous.” (Mandatory termination)
In addition, Principle VI, Quality of the Process, requires the mediator to conduct the mediation diligently, not to permit the process to become “unnecessarily prolonged,” and to monitor the continuing suitability of the case for mediation. NJAPM’s Code clearly permits these mediator decisions and actions, but does not lay them out expressly.
Judges’ Orders of referral and mediators’ retainer agreements should incorporate the above-cited rules and standards by language or reference. Mediators’ early disclosure maximizes the chances of the parties’ and their counsels’ “buy-in”, moves the process in a positive direction, and discourages misconduct by mediation participants. If the parties or one of them persist(s) in misconduct, then the mediator should terminate the process and refer the parties to another mediator, or, more likely, back to court. If legal counsel are involved, it sometimes helps to have a private meeting with them, to give them a reality check for possible future use with the clients.
VII. Disclosures to the Court
Unless the parties consent, neither the mediator, nor the parties, nor their legal counsel should advise the Court as to why a mediation has terminated. Trial judges or their CDR Point People uniformly want brief progress reports, i.e., whether the matter is moving forward; whether parties and counsel are showing up as required; and has the case resolved in whole or in part? It is sometimes necessary to integrate mediation management with the court’s own case management. With party consent (both the Standards of Conduct and UMA-NJ are clear on this point), communications between the mediator and the trial court are perfectly appropriate – and sometimes key to parties’ ability to resolve the case efficiently.
VIII. Mediation Practice Considerations
Importantly, mediators who also possess licenses to practice in the legal, mental health, accounting, or other regulated fields will be held to their licensed professional standards when practicing as a neutral. A mediator does not cease to represent his or her profession when acting as a neutral. Presumably, the neutral was selected for his or her reputation, skill, and experience in a primary profession. If the mediator’s behavior would have been actionable if performed by him or her in the course of the traditional licensed practice, then such misconduct may result in discipline by the licensing authority.
For example, Joint Opinion 676/18, previously referenced in this article, expressly states that a lawyer who serves as a mediator does so “as part and parcel of the practice of law . . . .” The Joint Opinion therefore imposes upon lawyers who mediate the duty “not to serve as mediator . . . in any case in which they have a conflict of interest,” and cross-references the attorneys’ Rules of Professional Conduct on confidentiality issues. Other professional boards will likely take the same approach vis-a-vis their licensees who also mediate.
In January of 2004, the New Jersey Supreme Court, with limited exceptions, put strict limits on the ability of an out of state lawyer to represent a party at a New Jersey mediation or arbitration. RPC 5.5(b)(3)(ii). A companion Rule makes it ethically improper for a New Jersey lawyer to “assist a person who is not a member of the bar in the performance of an activity that constitutes the unauthorized practice of law.” RPC 5.5(a)(2). In other words, by permitting an out of state lawyer to appear as a party’s legal representative in a mediation, an attorney-trained mediator would engage in unethical conduct.
N.J.S.A. 2A:23C-10 creates an interesting wrinkle to the unauthorized practice issue for attorney-trained mediators, since it expressly permits a party to designate a person to appear and participate in the mediation. In the case of an out-of-state lawyer, or an in-state person with an out-of-state law license, I think an excellent argument can be made that such persons are permissible designees and non-party participants at mediation, provided they do not act as legal representatives.
Mediators must become aware of limitations on our own practice. Mediators must know our limits in terms of complexity of matters to be mediated, but also must stay clear of informing parties substantively in fields and areas in which we lack familiarity or licensure when required.
For example, a mediator who offers legal or tax advice without a legal or CPA license risks engaging in unauthorized practice, which is a fourth degree crime in New Jersey, and also may invite a negligence claim – without benefit of otherwise available malpractice insurance (unauthorized practice is considered knowing and willful, not negligent, and therefore will not likely be an insurance covered event) . If an unrepresented party follows such advice to his or her financial or other detriment, then the mediator should expect to be called to task for his or her conduct. Similarly, a certified public accountant who serves as a mediator should not dispense mental health advice, or s/he could risk client complaints to the Board of Psychological Examiners, a lawsuit, or both. There is less of a risk for a lawyer-trained mediator in that regard, since legal practitioners are exempted from the psychological practices statute, to permit attorney-client counseling in moments of emotional difficulty.
Professional boundaries are getting less clear all the time. We have to be increasingly aware of and careful about the recombinant professional beings we create with our cross-disciplinary assignments.
With mediation as the preferred method of dispute resolution, New Jersey residents have begun to appreciate significant savings of time and money and, with any luck, the ability to stay out of court more or less permanently. However, sometimes mediation fails or ancillary civil or criminal litigation starts. When former mediation participants are hailed into court as parties or witnesses, our citizens should now have confidence that, except in specific circumstances and for particular public policy reasons, their mediation communications should be treated as sacrosanct.
As stated by the Supreme Court’s Advisory Committee on Professional Ethics and its Committee on Attorney Advertising, in Joint Opinion 676/18,
Alternative Dispute Resolution and Complementary Dispute Resolution have
. . . swept the country. Given the…expense of the more traditional adversarial process, state
and federal courts have embraced ADR and CDR as providing faster and less
expensive resolution of disputes.
Without question, New Jersey is in the midst of a major mediation revolution. As mediation practitioners and advocates, we have the opportunity to make these changes vital and long-lasting. If we want mediation to achieve co-equal status with adversarial processes, then we must adhere to the highest ethical standards.
In this article, I have shown that specific ethical precepts are available, as never before, to guide New Jersey’s professional mediators. All branches of government, the private sector, NJAPM, other professional organizations, and mediators from every discipline will continue to fill in the blanks. We will adjust our initial approaches based on the collective wisdom and experience. And for the long term – – to maximize public and professional gain – – we must hold fast to these worthy ideals.