HISTORY of the CALIFORNIA DISPUTE RESOLUTION COUNCIL
(A more detailed history is available from the CDRC.)
In November, 1992, thirty-five ADR pioneers from all over California attended a retreat to brainstorm and address future needs in the emerging field. This group included Bob Barrett, Randy Lowry (director of the Institute for Dispute Resolution at Pepperdine University), Ron Kelly, Ramon Raugust, and the late Don Weckstein of the University of San Diego. These and others represented court-connected and other established ADR programs in a variety of arenas, including family, environmental, public policy, commercial, and civil.
Brainstorming resulted in listing more than forty needs in the dispute resolution field, including the area of legislation. On the one hand, there was an identified need for a "cohesive voice for legislation, research about proposals, updating developments as they move through the legislation process, and education of legislators and staffs about the implications of different formulations of laws." On the other hand, the group saw the need to keep practitioners informed regarding legislation that had the potential to impact their practices and programs.
1992-1993: Early Visions
After the retreat, the number of interested participants expanded. Organizations such as the American Arbitration Association, the California Judicial Council, the State Bar Association's staff on Consumer Affairs, the three local chapters of the Society of Professionals in Dispute Resolution, the Southern California Mediation Association, the Northern California Mediation Association, county bar associations, and a number of community-based mediation programs joined the effort.
During a series of meetings that followed, the notion emerged that some of the needs would require a statewide organization with a focused purpose and mission if there were to be effective legislative advocacy for ADR. Legislative monitoring would require a day-to-day presence in Sacramento. In addition an organization was necessary to act quickly and draw ideas and views from a broad cross-section of the dispute resolution field in the state.
Key principles emerged:
As the group had begun to track bills, there were many with important implications for ADR practice in the state. Several bills required close attention, focusing on mandatory mediation (SB 401) and proposing to set standards for these programs, encouraging mediation directed at reducing racial and ethnic tensions, and increasing funding for community mediation programs.
1994: Organizing, Electing Leaders, and Seeking Members
At the first meeting of the new CDRC on March 20, 1994, in Sacramento, the group elected board members and officers and began planning how to implement a membership program. Bob Barrett was elected as the first president. In response to Ron Kelly's suggestion, the group also adopted five brief "Consensus Points" to guide its lobbying:
1. Definition. The mediation process should be clearly defined in substantially the form that follows: "Mediation" means a process in which a neutral person or persons facilitate communication between the disputants to assist them in reaching a mutually acceptable agreement.”
2. Funding. Mediation should be available to all parties in all types of cases, regardless of the parties' ability to pay.
3. Education. The courts, public agencies, and dispute resolution providers should share responsibility for furnishing information to the public, the bar, judges, court and government personnel, and others concerning dispute resolution processes, the availability of programs, the differences among various processes, the possibility of savings in cost and time, and the consequences of participation in such processes.
4. Declarations and Findings. No mediator should be required to submit, and no court should consider, any declaration or finding of any kind by a mediator regarding a case, beyond a required statement of agreement or non-agreement, unless all parties in the mediation expressly agree in writing.
5. Qualifications for Dispute Resolution Providers. Qualification criteria should be based on training, experience, and performance, not on the attainment of any particular academic degree or professional license.
CDRC began to track 12 bills, dealing with both mediation and arbitration. The board decided to support two, one encouraging the use of mediation in land use cases, which passed and was signed by the governor, and the other to enlarge funding for community mediation programs, which was passed, but vetoed by the governor.
At a strategic planning retreat in San Diego on September 11-12, 1994, the CDRC board set as a goal that CDRC should become the primary contact for legislators on dispute resolution topics. The board hoped that CDRC would be routinely consulted by legislative staff and others around the state on policy topics. The board clarified procedures and policies, and resolved that only the president or the president's designee could speak for the organization.
In November, the board clarified the procedures for studying and rapidly coming to positions on bills, either by vote of the full board or the executive committee. The year ended with about 200 active members and plans for implementing the vision for an effective advocacy organization.
1995: Establishing Procedures and Hiring a Lobbyist
Lauren Burton, then Executive Director of the Los Angeles County Bar Association Dispute Resolution Services, began her term as president on January 1, 1995. The first order of business was the hiring of a lobbyist for the organization. Fortunately, an excellent candidate was available, Donne Brownsey, who was just beginning a new lobbying firm and looking for "anchor" clients. She was an experienced legislative staffer who had excellent relationships with members on both sides of the aisle. It was also important that she had taken mediation training, which helped assure that she knew and shared the values underlying the practice of mediation and arbitration. She was an outstanding choice, and the relationship continues with a contract that is renewed annually by mutual agreement.
With a headline announcing: "Bill Tsunami Hits ADR Shores," CDRC's March 1995 Newsletter reported there were 74 measures that mentioned the words "mediation" or "arbitration".
Among the bills were arbitration measures extending judicial immunity for arbitrators and defining the scope of appeal for arbitration awards. In addition, Dennis Sharp, a vice president of the American Arbitration Association and Jim Madison, a well-known arbitrator, developed language for a bill that CDRC could sponsor to "clean up" the arbitrator disclosure legislation that had been passed the year before.
Also included among the flood of bills were proposals to establish a mandatory mediation program for selected counties and to create a voluntary credentialing program. That proposal raised many concerns among some in the dispute resolution field.
The CDRC "Consensus Points" were expanded by the Committee on Qualifications and Standards, chaired by Don Weckstein, into a comprehensive listing of CDRC Principles on topics expected to come up sooner or later in the legislature. These principles poised CDRC to react rapidly when new legislative proposals came to its attention, and firmly established CDRC as a "principle driven" organization.
It was important to CDRC that its approach to the proposed credentialing legislation would be seen as deliberative and principled. A special committee, chaired by Bob Barrett, held meetings around the state and prepared detailed recommendations for the CDRC board regarding the measure.
CDRC also, for the first time weighed in on a case, Engalla v. Permanente Medical Group, Inc. (1995) 43 Cal.Rptr.2d 621. CDRC requested review by the California Supreme Court of the appellate decision that had approved a one-sided, but mandatory and binding arbitration system in the health care field. The Supreme Court granted review and reversed the decision in Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951.
1996: Enhancing CDRC's Reputation and Building Capacity
Ken Bryant, a commercial mediator and arbitrator from San Jose, took over as president in 1996. Membership had grown to nearly 500, and the budget had risen to $46,000, most of which was used to retain Donne Brownsey.
The most pressing legislative challenges included the review of more than 85 bills mentioning mediation or arbitration and the development of positions on the three bills introduced by Senator Russell in 1995 and held over as "two-year" bills.
The three bills proposed a voluntary mediator certification program, suggested a requirement that attorneys advise clients about ADR in all civil litigations, and required judges to hold early status conferences in all civil cases to consider mediation. Senator Russell wanted to promote greater use of dispute resolution, but many concerns had been identified with specific provisions of the bills. CDRC carefully studied each proposal and sought extensive input from its members, especially on the certification bill. Positions were prepared in order to describe the implications of the bills at legislative hearings. In the end, none of the three bills passed.
CDRC, however, was successful in sponsoring its first bill seeking to increase funding for mediation programs under the Dispute Resolution Programs Act. Lauren Burton drafted the bill's language, working closely with Los Angeles County's legislative staff, and it was introduced by Assemblyman Antonio Villaraigosa of Los Angeles. With extensive efforts by Donne Brownsey and DRPA-supported organizations throughout the state, the bill passed and was signed by the Governor.
Inspired by Dennis Sharp, president-elect, CDRC also began its first annual statewide dialogue programs, held during March in four locations: Sacramento, Los Angeles, Anaheim, and San Diego. More than 300 dispute resolution practitioners participated, with lively facilitated discussions on such issues as mediator certification, court-referred mediation, arbitrator immunity, arbitration vacatur grounds, DRPA funding, lawyer obligations to clients concerning advising about ADR, and arbitrator disclosure requirements.
1997: Expanding Membership and Developing Infrastructure
Dennis Sharp became president in 1997 and devoted much attention to building the membership of CDRC and improving CDRC's administrative capacity. Membership grew to 600 individual members and 150 organizational members. The budget increased again, to $60,000 and special contributions were also received to supplement membership dues revenues.
A key benefit of membership was the publication of CDRC's first Directory, which also included a copy of the CDRC Principles and a list of committee rosters and CDRC accomplishments.
CDRC became very involved in two key legislative projects. The first involved the efforts of the California Law Revision Commission to modify and clarify the law applying to mediator confidentiality in the state. Ron Kelly, on behalf of CDRC, closely followed the development of this comprehensive new statute, which successfully codified strong protections for confidentiality of the mediation process, explicitly protecting mediators from compelled disclosure of mediation communications, the substance of mediation participation, or efforts to set up a mediation in later civil litigation. CDRC played an active role in commenting on the specific legislative language that evolved. The second key proposal concerned arbitrator disclosures and CDRC successfully sponsored arbitrator disclosure cleanup legislation.
Finally, in the wake of the defeat of mediator certification in 1996, CDRC began an effort to develop a comprehensive set of standards that could govern mediation practice and that would be a model for courts, counties, and mediation programs to adopt. It was believed that the "model standards" approach would be preferable to legislation that would be difficult to enact and even more difficult to amend or modify as needed in later years. Lee Jay Berman, a Los Angeles mediator, chaired a special committee to prepare a draft set of standards. The committee's drafts were widely circulated within the state and improved through such consultation, and attracted a substantial list of endorsers.
1998: Lobbying Effectively and Looking Beyond Legislation
In 1998 Norm Brand, an arbitrator and mediator from San Francisco, began his term as president. A prominent legislative concern was whether disclosure requirements for mediators should be similar to those enacted earlier for arbitrators. CDRC representatives met several times during the fall of 1998 with the staff of the Assembly Judiciary Committee to discuss this complicated area. Due in part to the success of CDRC in articulating the difficulty of crafting appropriate language, no legislation emerged from the Committee.
The most important development during the year was the California Supreme Court's decision in Birbrower, Montalbano, Condon & Frank v. Superior Court (1998) 17 Cal.4th 119, holding that representation of a party in arbitration constituted the practice of law. CDRC advocated the standard of the international arbitration statute, permitting representation of a party in arbitration by anyone that party chooses. Despite those efforts, Birbrower remains the California rule.
CDRC also produced a widely endorsed draft of Standards of Practice for California Mediators, which were circulated for use by courts, counties, and mediation programs. They have since been adopted by two programs, have served as a model for several more programs, and are under consideration for adoption in many more locations throughout the state.
1999: Increasing Administrative Support
Liz O'Brien, executive director of the San Diego Mediation Center, became president of CDRC in 1999. One of the key issues during the year was the emergence of a series of proposed drafts of a Uniform Mediation Act being produced by committees of the American Bar Association and the National Conference of Commissioners on Uniform State Laws. The early drafts of that proposal included language that, if enacted in California, would weaken the protections for mediation confidentiality. John Seitman, an arbitrator and mediator from San Diego and formerly president of the state bar, chaired a committee that studied the draft proposal and prepared formal comments on it. Several CDRC representatives also met with the ABA/NCCUSL drafting committees in December in Monterey. In addition, CDRC sponsored well-attended dialogue sessions in May to focus on the Uniform Mediation Act draft.
On October 15, 1999, CDRC held its annual conference in the San Francisco area featuring discussions about where mediation and arbitration were going, dispute resolution research needs, and the Judicial Council's Task Force report on ADR and its implications for the courts, litigants, and the public. The conference also highlighted legislative developments, and sought membership input on priorities for attention in the upcoming year.
Principal legislative action focused on efforts to ban pre-dispute arbitration clauses in employment and insurance contracts, and in connection with contracts for medical care or treatment. The 1999 version of the bill was dropped after several amendments stripped the bill of its application to insurance, consumer, and health-care contracts.
Organizationally CDRC's membership leveled off, with the false perception that the legislative activity was not as urgent as it had been in the past. The board also began to address longer-term needs.
2000: Enhancing Influence and Visibility
John Seitman became president of CDRC in January 2000. In July CDRC launched a project focusing on compensation of neutrals in court-connected, agency-operated, and community-based programs.
2001: A Challenging Year
If ever the CDRC had to face a challenging year, it was 2001 with Jim Madison as president.
One challenge erupted when a panel of arbitrators chaired by retired California Supreme Court Chief Justice Malcolm Lucas rendered an award requiring the State to pay $88.5 million to lawyers in a fee dispute. The Governor thought the award was excessive, and a receptive Legislature passed Senate Bill 475. In its original form, this measure would have micro-managed arbitrator disclosures and disqualifications and vacatur of awards. Thanks in part to the efforts of the CDRC, the final form of the bill deferred establishment of arbitrator ethics standards, including disclosure requirements, to the Judicial Council.
The Judicial Council was mandated by the bill to act under a tight time schedule to adopt standards. To assist in its drafting task, the Judicial Council appointed an Advisory Committee of Experts in Judicial Ethics. Four CDRC members, including past-president Ken Bryant, Richard Chernick, John Kagel and current president Jim Madison were appointed to this Committee and served effectively in minimizing the adverse effects of the Standards on the arbitral process.
On the mediation front, CDRC co-sponsored a series of public dialogues in March at which members and other interested individuals could discuss the circumstances under which mediators should be paid and when they should serve pro bono.
The most satisfying development of the year for the CDRC was the California Supreme Court’s July decision in Foxgate Homeowners Association, Inc. v. Bramalea California, Inc., 26 Cal. 4th 1 (2001), in which the Court held that the Legislature did not leave California’s mediation confidentiality statute open to the creation of judicial exceptions. The CDRC had filed an amicus curiae brief authored by Madison and Michael Carbone in support of what turned out to be the Court’s decision. The prevailing party was represented by Ivan Stevenson, who joined the CDRC, became increasingly active as a mediator and was later elected to the CDRC board.
The efforts of the CDRC to influence the form of the proposed Uniform Mediation Act, which had been spearheaded by founding member Ron Kelly and 2000 president John Seitman, concluded in August 2001, when the National Conference of Commissioners on Uniform State Laws approved the Uniform Act.
CDRC’s well-attended annual ADR Conference in November featured a keynote address by United States District Court Magistrate Judge Wayne Brazil, in which, among other matters, he spoke of the need for “courts to refrain from imposing role-distorting pressures on ADR neutrals.” In particular, Judge Brazil appeared concerned lest mediations become nothing more than settlement conferences.
2002: The Year of Reform and Regulation
2002 was a year in which new rules for neutrals and providers took root. President Ruth Glick, Donne Brownsey and the entire board worked persistently and relentlessly to make sure new regulations would be reasonable and workable for ADR professionals.
The legislative agenda for ADR reform in 2002 was thrust into the public eye with a three part investigative report in the San Francisco Chronicle about the failures of private arbitration. A blue-ribbon panel was appointed by Chief Justice Ronald George to assist in drafting new ethical standards. CDRC members Jim Madison, Ken Bryant and Richard Chernick were part of the panel and added their sage advice and assistance to the drafting process. Their strong but minority voices sought to shape the rules to insure compliance by ADR professionals. Ruth Glick wrote two lengthy letters on behalf of CDRC warning of unintended consequences of the developing standards and explaining how to make them more practicable and useful to the arbitration community.
The Ethical Standards for Neutral Arbitrators in Contractual Arbitration were incorporated into California Code of Civil Procedure on July 1, 2002. For the first time anywhere in the nation, in any state, arbitration providers, community non-profits and private arbitration companies became subject to extensive disclosure requirements and prohibitions. Moreover, arbitrators themselves became subject to the most rigorous and technical disclosure requirements trumping already existing federal and state requirements. Ethical goals were now written into rules, and failure to follow them would result in vacature of an arbitration award and possible retaliation against the arbitrator and provider. As the CDRC warned, this has happened since the implementation of these Ethics Standards.
Meanwhile in Sacramento, Donne Brownsey and Ruth Glick worked hard communicating to legislators and their staff not to create an inordinate amount of new reform legislation that would be so unreasonable that providers would discontinue providing arbitration services in California. Some initial legislative drafts were extraordinary in their lack of understanding. For example, one piece of legislation sought to treat arbitrators who served in more than five consumer arbitrations a year as arbitration providers themselves, thereby requiring quarterly global reports. CDRC was able to discourage its passage.
Of six new arbitration bills passed by the Legislature, the Governor signed five into law. CDRC actively worked with the legislature and the Governor’s office to make the bills reasonable for compliance. Taking notice of the potential for unintended consequences pointed out by CDRC, the Governor vetoed AB 3029, the sixth bill which would have caused significant problems in its application.
During the same year the Judicial Council also developed the Rules of Conduct for Mediators in Court-Connected Mediation Programs in Civil Cases, rules which were not as controversial as the arbitration ethics standards. CDRC members Ellen Miller, Mickey Katz, Lee Jay Berman and others carefully crafted comments to these new rules.
For the first time in 2002, CDRC was able to implement mass emails to members. This allowed for timely communication in a cost efficient manner. In addition, the electronic newsletter made its first appearance that year, courtesy of Dick Bayer.
CDRC also weighed in on an extraordinarily important appellate court decision, Rojas v. Los Angeles County Superior Court (2002) 126 Cal.Rptr.2d 97. Because the case had significant implications for mediation confidentiality, CDRC submitted a letter requesting the Court de-publish the case, or in the alternative, review the ruling (see 2004 for a review of the Supreme Court’s decision in Rojas and CDRC’s position.)
The annual conference was held at Loyola Law School with well over 100 people attending. Blue Ribbon Panel Chair, Dean Jay Folberg and State Senator Sheila Kuehl were part of an exciting lineup of speakers.
Members’ enthusiasm and level of interest was extraordinarily high in 2002. It was a very important year for CDRC’s role in shaping ADR in California.
2004: A Year of Transition
As Tom Reese became President in 2004, John Blackman and Nancy Warren, on behalf of CDRC, were intensely working with Bob Barrett from the Leo McCarthy Center at USF to produce a computation and analysis of consumer arbitration cases required by CCP 1281.96 from six large arbitration services providers.
Rojas v. Superior Court 33 Cal.4th 407 (2004) was decided by the California Supreme Court with the aid of the Amicus Curiae brief prepared by CDRC’s Public Policy Committee under Jim Madison urging the position eventually taken by the Court.
CDRC also sponsored 11 Dialogues with local Bar Associations, the Mediation Society, and other ADR interest organizations throughout the State to flush out what mediation users were experiencing from mediation providers. This was in response to the growing discussion about further regulating, and possibly credentialing, mediators.
In addition, CDRC focused on community mediation in California. Donne Brownsey, CDRC’s legislative analyst, worked closely with the Judicial Council and the Court Fees Working Group to protect the portion of the court filing fee that was directed to community programs through the Dispute Resolution Programs Act. CDRC also sponsored and assisted in the creation of the California Coalition for Community Mediation (CCCM) with special membership fees, meetings as part of CDRC’s Annual Conference, the ability of community practitioners (and others) to obtain E &O insurance, and representation in Sacramento through CDRC.
CDRC also initiated the annual MCLE presentation at the State Bar Conference on “ADR Happenings in 2004” featuring a panel of current officers of CDRC.
The year ended with a celebratory Tenth Anniversary Gala at the Los Angeles Athletic Club honoring founding Board members, the LA Bar Association’s Dispute Resolution Service, San Mateo’s PCRC, San Diego’s NCRC, the Contractor’s State Licensing Board and Richard Chernick for the standards of excellence they set in the provision of neutral services. Dick Bayer, Don Fobian, Amy Johnsgard and Gerald Phillips were responsible for this highly successful and nationally remarkable occasion.
2005: Working the Edges
Dick Bayer became President in 2005 and oversaw a year of transition in partnering relationships. CDRC marked the beginning of its expanded collaboration with the many ADR member organizations in the State.
The Board elected at the annual meeting was the first board with policy level members from the most important sectors of the California ADR landscape, including representation from JAMS, AAA, NAF, the Straus Institute at Pepperdine, court connected programs, and community programs, as well as independent mediators and arbitrators. CDRC strengthened its alliance with the newly created California Coalition for Community Mediation.
In Sacramento, CDRC sponsored legislation to delete the sunset provisions of Code of Civil Procedure §1282.4, allowing parties in arbitration to be represented by out-of-state counsel. CDRC also worked with the Law Revision Commission on its proposal for a State Ombudsperson for Home Owner Associations in California.
In the courts, CDRC filed an amicus brief arguing strongly for arbitral immunity for both the arbitrator and his sponsoring organization in a case involving damage claims against the arbitrator based on the claimed non-disclosure of involvement in a case more than twenty years old. That case settled in April.
Once the Rojas decision was announced in December, 2004, articles appeared within the next week authored by various trial attorneys around the state criticizing the ruling. There were calls for the Consumer Attorneys of California to draft legislation to overturn Rojas and weaken the confidentiality statute. CDRC met with the CAOC to ensure that no such legislative action would be forthcoming in 2005 and none was. CDRC committed to work alongside CAOC to address confidentiality concerns as well as cooperate with CAOC on access to justice issues.
The State Bar of California introduced a seemingly benign proposal that all attorneys performing ADR services must maintain "active" status with the State Bar, even if they no longer practice law. CDRC argued that this would unwittingly help establish that acting as a third party neutral in mediation and arbitration constitutes the "practice of law." CDRC filed a strong statement in opposition to the rule resulting in the Bar amending its proposal (CDRC continued to challenge the less heinous but nonetheless dangerous attempt to include alternative dispute resolution within the compass of the Bar.)
The Judicial Council proposed rule changes to California Rules of Court 1620, 1621 and 1622, including a new complaint procedure against mediators in court connected programs. CDRC took a very strong position that welcomed review of mediator services but found Rule 1622 an over-reaction to what appeared to be a very small problem. The Judicial Council withdrew Form ADR108 that contained a confidentiality waiver tied to a complicated complaint procedure.
CDRC also weighed in on the issue of free mediation services in connection with the Los Angeles Superior Court mediation program and voiced its opinion that the program ran afoul of some of CDRC’s announced principles, including the concept that parties should pay for mediation services when they can afford them. CDRC later sponsored a dialogue in Pasadena to address concerns with court-connected programs. CDRC was included in the small circle of individuals and organizations looking into that issue with the Los Angeles Superior Court.
2006: A Year of Coming of Age
In 2006, John Blackman took the helm of CDRC. In many respects, 2006 was a year when the CDRC rose to a new level of prominence on the ADR scene as people across the country recognized the ground-breaking ADR work that takes place in California. For example, CDRC was consulted by members of the U.S. Congress concerning mediation language pending in several congressional bills, It was only fitting that at its January board meeting in San Diego in 2006, CDRC changed its slogan from “The Voice of ADR in Sacramento” to “The Voice of ADR in California.”
As in past years, CDRC once again weighed in on a myriad of issues. CDRC members provided public comment to proposed changes in arbitrator disclosure rules, and continued working with the California Law Revision Commission concerning dispute resolution procedures for common interest developments.
Again, by working the stakeholders behind the scenes, CDRC successfully guided the issue of ‘pro hac vice’ status (allowing out-of-state lawyers to participate in arbitration proceedings in California) into a process that works for everyone. CDRC also weighed in as a major stakeholder in the continuing saga of the first legislation governing the important and innovative new ADR technique known as “Collaborative Law” – initially designed for use in the family law field, but almost certainly destined to reach other areas of dispute resolution as well. As a small example of the tremendous amount of volunteer work CDRC does, the Board considered 14 separate pieces of proposed legislation affecting ADR at its July Board meeting alone.
CDRC board members Jennifer Bullock and Elizabeth Strickland continued their pioneering work leading the California Coalition of Community Mediators (“CCCM”), a unique networking clearing-house for all things important to community mediation in California. The success of this CDRC-nurtured offshoot should remind everyone of the deep roots CDRC has in community mediation programs, highlighting once again that CDRC is not just another trade organization promoting the ‘business’ of ADR, but rather it is a guardian of ADR principles, promoting the principles that make ADR an essential component of our society’s system of justice.
Early in 2006, CDRC began a lengthy project, capably headed by board member Steve Dinkin of San Diego’s National Conflict Resolution Center, to determine if a set of principles or minimum standards could be developed for mediation training programs.
In 2006 CDRC continued to struggle with the State Bar’s interpretation of Section 2 of the State Bar Act, which they contend prohibits lawyers from acting as ADR neutrals while on inactive status. The implication of this position is that providing ADR services constitutes the practice of law – a concept that someday could be used to attempt to prohibit non-lawyers from being arbitrators or mediators. The final chapter has yet to be written as to whether lawyers and the court system get to control the field of ADR, or whether ADR extends beyond lawyers and the courts. But CDRC will continue the fight.
As always, CDRC continued to file amicus letters or briefs in the more important appellate cases involving ADR issues. Members of CDRC weighed in on the difficult cases of In re the Marriage of Kieturakis 138 Cal.App.4th 56 (2006) (mediation confidentiality upheld), and Gentry v. Superior Court (later to become a California Supreme Court case in 2007, at 42 Cal.4th 443) (class action rights not waivable in arbitration), among others.
The ADR scene was active right up until the end of the year, with the California Supreme court issuing the landmark ADR case of Fair v. Bhaktiari in mid-December. But the most significant case of the year also came out around this same time, from the Second District Court of Appeal – Simmons v. Ghaderi. This is a very problematic case which created broad exceptions to mediation confidentiality. Jim Madison and John Blackman, former presidents of CDRC, wrote an amicus letter to the California Supreme Court urging that it accept the case for review and that it reverse the appellate court. On December 20, 2006, the Supreme Court did accept the case, and as we all know, that paved the way for the Supreme Court’s eventual ruling, which followed CDRC’s Dispute Resolution Principles and maintained strict mediation confidentiality.
CDRC also weighed in on an important proposed change to the Professional Rules of Conduct for lawyers. We provided public comment (and expertise behind the scenes) concerning proposed new rule 1-720 (or Rule 2.4 under the proposed re-numbering to track with the ABA Model Rules), which also could have been interpreted to say that the practice of ADR was the practice of law, and thus reserved for lawyers. Fortunately, CDRC and other ADR organizations kept the most offensive provisions out of the draft that will eventually be sent to the full Judicial Council and Supreme Court for approval.
On another front, the CDRC was successful in fending off another Judicial Council attempt to “over-legalize” the mediation process, when it was able to overcome features of proposed Rule of Court 1634 from coming into effect. Among other things, this rule could have been interpreted to provide the courts with authority to order parties to mediation against their will, and to sanction them if they failed to participate.
This year also saw continued work on revisions to CDRC’s Dispute Resolution Principles. After its first posting in 2005, a second proposed revised version of this document was posted on the internet for public comment.
Finally, a busy year came to a very satisfying close with the 13th Annual ADR Policy Conference, held at Loyola Law School in Los Angeles. CDRC proudly made the first presentation of its “California Dispute Resolution Council Award” in 2006, to be presented annually to a Straus Institute student for excellence in ADR scholarship.
But the real shining moment of the 2006 Annual ADR Conference was the Gala Awards Dinner held at the Los Angeles Athletic Club in downtown Los Angeles. Tom Stipanowich, then newly minted as the Academic Director and Professor of Law at the Straus Institute for Dispute Resolution at Pepperdine School of Law in Malibu, and CDRC Board Member Peter Robinson accepted CDRC’s highest honor, the Don Weckstein Award, on behalf of the Straus Institute. Also honored at the dinner was CDRC’s own inimitable “Ambassador of ADR” and longtime stalwart of the ADR community, not just in California, but nationwide – Mr. Gerry Phillips of Beverly Hills. If there are a handful of people whose very lives reflect the tremendous commitment to ADR principles that CDRC stands for, Gerry Phillips is one of them. CDRC and the entire California ADR community were truly blessed in 2006 to benefit from his tireless work.
2007: A Year of Reconnection
Don Fobian became president of CDRC in 2007. Don and immediate past-president, John Blackman, traveled to Sacramento, where they met with Larry Doyle and Saul Bercovitch of the State Bar; Kate Howard and Dan Pone of the Judicial Council; Eric Cizmar, Legislative Deputy for the Governor; Assembly Judiciary Committee Chair, Dave Jones, and Assembly Committee staff attorney, Kevin Baker; Senate Judiciary Committee Vice Chair, Tom Harmon; and Gene Wong, Chief Counsel to the Senate Judiciary Committee. Don and board member Elizabeth Strickland also traveled to Los Angeles to meet with Judge Helen Bendix and Julie Bronson, court administrator of the Los Angeles Superior Court mediation program.
CDRC was also honored to be one of the co-sponsors of the World Forum 2007 conference entitled “Justice, Religion and Conflict Resolution” hosted by the Rock Rose Institute (whose founders include CDRC members). Participants came from around the world and the conference featured prominent speakers Archbishop Desmond Tutu and former Secretary of State, Madeline Albright.
In 2007, CDRC and other organizations joined together in protest of changes in the State Bar Rules Revision Commission’s proposal that would have given jurisdiction to the Bar to discipline mediators and arbitrators based upon violations of standards that were never meant to form the basis for discipline. Specifically: the draft rules transmuted aspirational standards in court-related mediation programs and arbitrator ethics standards for contractual arbitrations into disciplinary grounds. CDRC and its organizational allies were able to thwart the efforts of the RRC.
The amicus curiae brief that was authored by Jim Madison and John Blackman as a response to the Simmons v. Ghaderi case which was a challenge to mediation confidentiality proved to be successful. CDRC has been a very effective advocate for such cases throughout its history.
Federal Magistrate Wayne Brazil was 2007 keynote speaker and recipient of the Don Weckstein Award at CDRC’s Annual Meeting and Policy Conference in Foster City.
2008 A Year of Vetoes
Paul Dubow, who had been chair of the Legislative Committee, became president in 2008.
CDRC was a major sponsor of SB 1177, which was designed to increase the revenue provided under the Dispute Resolution Program Act (“DRPA”) to community mediation organizations. The existing DRPA legislation permitted each county to divert up to $8 from each civil filing fee for use by community mediation organizations in the county. The combination of inflation and reduced civil filings made it necessary to increase the maximum amount that could be diverted and SB 1177 would have raised that amount to $12. Senator Mark Ridley-Thomas carried the bill. We faced an initial roadblock when Senator Perata, the president pro tempore of the Senate, introduced a bill that would divert $35 from the filing fee for the reconstruction of county courthouses. After much discussion, Senator Perata agreed that $3 could be used as DRPA funds, which would have increased the amount available under DRPA to $11. The bill passed both houses. Governor Schwarznegger’s staff initially indicated that he would sign the bill but, to everybody’s surprise, he vetoed it. CDRC would not let this DRPA issue drop, and decided to start again in 2009.
During the course of the year, two bills were introduced in the Legislature with worthy motives that would have had a negative impact on arbitration generally. The bills were AB 2359, which was designed to eliminate practices that negatively affected consumers who entered into sub-prime mortgages and AB 2947, designed to prohibit residential care facilities from requiring patients to waive certain legal rights as a condition of admission or continued care.
Among other things, both bills would have prevented lenders and residential care facilities from requiring their customers and patients to enter into certain types of pre dispute agreements. It is one of the guiding principles of CDRC to oppose pre dispute agreements imposed upon consumers through adhesion contracts. Both of these bills provided for a new Section 1281(b) of the California Arbitration Act. This section was so broad that it would have also barred arbitration agreements that were not unconscionable and, as a result, the bill was likely to be preempted by the Federal Arbitration Act. Thus, the bills would not have accomplished their purpose and would have led to extensive litigation over the issue of preemption.
CDRC met with the authors of the two bills and, as a consequence, both legislators agreed to eliminate Section 1281(b). In addition, a new section was added to AB 2947 which specifically stated that the bill did not affect otherwise enforceable arbitration agreements. Both bills were passed by the Legislature, but they were vetoed by the Governor.
Two bills (S. 1782 and S. 2554) were proposed in Congress that would have substantially restricted the ability of vendors and employers to impose arbitration agreements upon consumers as a condition of doing business or on employees as a condition of employment. The purpose of both bills was salutary, but CDRC believed that they were so broad that they would restrict access to justice for consumers and employees. CDRC expressed its views in a letter authored by Paul Dubow. Neither bill reached the floor of the Senate.
The Administrative Office of the Courts (“AOC”) proposed new guidelines for mediators in court connected mediations. Courts would not be required to adopt the guidelines. Rather, they would serve as minimum standards for mediators in court connected mediations. CDRC supported the proposal in principle, but sent a letter to the AOC in July suggesting some amendments. The guidelines were still under discussion at year end.
The California Supreme Court reaffirmed its support of mediation confidentiality by reversing the decision of the Court of Appeal in Simmons v Ghaderi.CDRC filed an amicus curiae brief in the case, authored by Jim Madison, the chair of the Public Policy Committee, urging that the lower court’s ruling that a mediation party could be estopped from asserting mediation confidentiality be reversed on the ground that estoppel was not an exception to the statutory scheme that created mediation confidentiality. Many of the arguments that were raised in CDRC’s brief were contained approvingly in the Supreme Court’s decision.
Our year concluded with the annual conference, held this year in Los Angeles. Ester Soriano was the recipient of the Don Weckstein Award. Ms. Soriano had passed away earlier in the year and so the award was presented to members of her family. She earned the award because of her dedication to and support of community mediation in California during her lifetime.
In further recognition of Ms. Soriano’s service, CDRC established an award in her name which would be given annually to an individual who demonstrated a long term commitment to and advocacy for community mediation in California. Senator Mark Ridley-Thomas was the first recipient of the award. He was recognized because of his magnificent effort to obtain the legislature’s passage of SB 1177.
2009 - A Turn to Washington
Maurice Zilber became President in January 2009. Because of the budget crisis, there was relatively little legislative activity in Sacramento affecting neutrals, but there was much activity in Washington affecting arbitration that CDRC monitored and commented on.
CDRC supported two bills in California introduced by Assembly Member Monning: AB 1 would have added conflict resolution training to the list of subjects for which teachers could gain credentialing credit. The bill passed the legislature but was vetoed by the Governor. AB 1090 made non-waivable certain ethics requirements and standards for arbitrators. It became Chapter 133 the Statutes of 2009.
CDRC also supported, if they were amended, several other California bills relating to construction contracts with the University of California and employment contracts arising out of employment or conduct in California. These were either vetoed or failed to pass.
While CDRC remained concerned about funding for DRPA programs, we were advised by our lobbyist to wait until 2010 to renew that effort.
CDRC provided comments to legislative staff on AB 1588 which would establish a monitored mortgage workout program. Our comments along with others have been taken into account in a redraft of the bill, which was expected to be released in February 2010.
CDRC is concerned with legislative or administrative initiatives that affect Alternative Dispute Resolution processes in California wherever they may be introduced. Therefore, CDRC followed with interest and concern three bills introduced in Congress: Arbitration Fairness Act of 2009, H.R. 1020; Fairness in Nursing Home Arbitration Act of 2009, H.R. 1237; and Consumer Fairness Act of 2009, H.R. 991. These bills, if enacted, would invalidate any pre-dispute arbitration clause in employment, consumer, franchise or nursing home agreements. CDRC's Dispute Resolution Principles provide that arbitration should be voluntary, so unless a pre-dispute agreement is entered into voluntarily, the arbitration clause should not be binding. Thus, we supported the underlying purpose of this proposed legislation to the extent that it prohibits one-sided or compulsory arbitration agreements. Nevertheless, aspects of the proposed legislation are troublesome, particularly language that could be interpreted to upset settled law relating to commercial arbitration. We submitted comments to Congress in the Spring and re-sent comments to staff members of the House Sub-committee considering the Bills reiterating CDRC’s willingness to assist in crafting language for an opt-in provision for consumers, employees, and franchisees as part of our concern that an absolute ban on pre-dispute arbitration clauses would diminish access to justice for the very class sought to be protected by the legislation. We also suggested that the Subcommittee consider adding a ban on class action waivers in arbitration.
In mid-summer we added a new benefit for our members. CDRC became an Affiliated Organization with the American Institute of Mediation (“AIM”), a recently formed independent organization for the training of mediators. CDRC members are entitled to 10% off all AIM courses and 10% off all books, materials, and other items in the AIM bookstore.
In October we had a very successful well-attended annual conference. For the first time we teamed up with the U. C. Hastings Center for Negotiation and Conflict Resolution, which provided us with superb accommodations. Assembly Member Bill Monning, who had a distinguished career in dispute resolution before running for the State Assembly, presented our keynote address. Assembly Member Monning outlined the background of the State’s budget problems and some suggestions going forward to attempt to correct the legislative impasse of recent years. Donne Brownsey, as always, gave a witty and cogent view of the legislative year. There were excellent panels on methods to make arbitration faster and cheaper, neuro-science and mediation, trends in collaborative law, the use of mediation in non-litigation settings, arbitration in the motion picture industry and an exploration of the analytical framework parties, counsel and mediators bring to the mediation process.
The Don Weckstein Memorial Award was presented to Jim Madison in recognition of his work on the State Bar ADR Committee, as chair of CDRC’s Public Policy Committee, including his many effective amicus briefs to the California Supreme Court, and his widespread teaching and lecturing activities on ADR topics. The Ester Soriano Award for Excellence in Community Mediation was presented to the San Francisco Community Boards, which is recognized as a pioneer in the field of community mediation and a model for many non-profit mediation programs across the country. Awards were also presented to the winner of the annual Strauss Award for the best paper on ADR written by a Strauss Institute student in the past year and to the Hastings Mediation Team. AIM sponsored a wine and cheese reception that attendees appreciated very much.