OBE 118 - LEGAL ENVIRONMENT OF BUSINESS Dispute Resolution

1. OBE 118 - LEGAL ENVIRONMENT OF BUSINESS Dispute Resolution

2. PREFATORY THOUGHTS • You are discussing with your attorney a legal problem. You are confident that your version of the facts in the dispute can be proved. • You ask the attorney “does my cause has merit? • She says “yes.” • You ask if you pursue the case will you win? • She says: “I cannot predict the future.” • You ask “What are my chances? “ • She says, “Assuming what you told can be proved” then:

3. PREFATORY THOUGHTS •  She says, “assuming the story you have told is correct” then: • EXCELLENT

4. PREFATORY THOUGHTS • Assuming a winning case • What is the importance of debt collection and the term judgment debtor?

5. Alternative Dispute Resolution (ADR) describes alternatives to the traditional judicial resolution of disputes • Major approaches to dispute resolution Power Rights Interest

6. ADR suggests a move from a rights approach to an interest based approach in dispute resolution.

7. ALTERNATIVES TO LITIGATION INCLUDE •  Arbitration •  Mediation • Negotiation Of less importance •  Private judging •  Ombudsperson •  Summary jury trial •  Mini-trial

8. ARBITRATION • Disputing parties agree to select a neutral third party (or parties) to hear and decide the dispute. •  Generally private, historically private. •  Requirement of (at least) the passive approval of government, as the awards are ultimately enforceable in the courts.

9. TYPES OF ARBITRATION •  Voluntary •  Pre-dispute agreement provides that arbitration will be used to settle disputes arising between the parties. Clause is part of an otherwise enforceable contract. •  Post -dispute agreement. Agreement entered into after a conflict arises. •  Involuntary • Judicial arbitration - statute requiring parties in certain cases to submit cases to arbitration as a pre-condition to a lawsuit. It is NON-BINDING.

10. NATURE OF ARBITRATION (CONTINUED)  Federal and state statutes authorize & encourage arbitration  Arbitration processes are usually less formal than courts.  Power of arbitration based on the agreement of the parties, statutory law, and/or incorporated procedures.  Power of arbitration can be lost at any time if both parties agree to handle the dispute in court.  If arbitration clause exists but one party refuses to arbitrate the other party can seek a judicial order to compel arbitration.

11. NATURE OF ARBITRATION  Issues to be heard, number of arbitrators, arbitrator power, processes to be used, and timing are all-dependent on the arbitration agreement. Arbitration clauses  provide the procedural and substantive boundaries of the case.  arbitrators clauses are provided from organizations such as AAA

12. QUALIFICATION AND SELECTION OF ARBITRATORS  Agreement of the parties names the arbitrator(s) Use of standard clauses of professional associations. Such as the American Arbitration Association Permanent referee for series of expected or possible disputes  Selection from panels  Expertise in subject matter of dispute  Known in field  Reputation for fairness  Recommendation by board  Trained in hearing processes

13. WHY SELECT ARBITRATION?  Faster from filing to hearing  Cheaper  Private  Less adversarial than litigation  More certain resolution

14. WHY SELECT ARBITRATION? (CONTINUED) PROBLEMS  Private. Public is unaware of disputes in which they may have an interest. Potential litigants unaware of case outcome.  True consent of parties to arbitration?  Not always less expensive?  Loss of right to correct errors of law as the right of appeal is very limited.

15. Arbitrator Qualifications • ?

16. MEDIATION Mediation--A form of negotiation with the most significant attribute being the addition of a skilled third party expert who assists (facilitates) the parties to negotiate their own resolution. Definition: Intervention in a negotiation or a conflict by an acceptable third party with limited or no authoritative decision-making power but who assists the involved parties in voluntarily reaching a mutual acceptable settlement of the issues in dispute (Christopher Moore).

17. MEDIATION (CONTINUED) • Overall concept is simple. Sometimes referred to as the world’s second oldest profession. Exists in some fashion in most world cultures. • Two parties in conflict seek a third party to assist them in resolution of that conflict. The third party assists conflicting parties in communicating but does not decide the dispute.

18. GENERAL NATURE OF AND CONTRAST WITH OTHER METHODS IN THE UNITED STATES  Private while litigation is public.  Parties remain in control of decision rather than relinquishing control to government or third party.  Mediator facilitates agreement instead of imposing a resolution like in litigation or arbitration.  Non-adversarial while litigation in U.S. is adversarial.

19. GENERAL NATURE OF AND CONTRAST WITH OTHER METHODS IN THE UNITED STATES (CONTINUED)  Occurrence of mediation suggests progress because it is voluntary. Parties may not agree on resolution but they agree on a method to resolve dispute.  Mediation is less formal than other methods.

20. HOW PROCESS IS SELECTED OR BEGUN  Pre-agreement  Post-agreement  One party seeks mediation and the provider contacts the other party  Referrals

21. PROCESS PROVIDERS  Non-profit generalists ADR providers - American Arbitration Association  Community mediation centers such as the Sacramento mediation center  State mediation providers such as the California center for public dispute resolution or the Iowa Peace Institute  Private vendors

22. CASES MOST APPROPRIATE FOR MEDIATION  The parties have a stake in resolving the dispute. The parties share motivation for early settlement. The parties are interdependent and must rely on the cooperation of one another to meet their goals or satisfy their interests.

23. CASES BELIEVED INAPPROPRIATE FOR MEDIATION Disputes focused on beliefs. Severe imbalance of power between the parties. Unmanageable behavior on the part of either party

24. MEDIATORS (CONTINUED)  QUALIFICATIONS  Experience in dispute resolution including training and by temperament. Person is able to influence and cajole parties as if a group leader without having had the time to develop that level of respect.  Area expertise. Understands the underlying nature of the dispute.  Listener. Creative problem solver.  Neutral

25. POSITIVE ATTRIBUTES OR MEDIATION •  Can be initiated early in the process providing opportunity to end conflict early with a reduction in conflict cost, legal fees, and psychological cost of conflict. Good public relations. • Studies show that up to 95% of civil lawsuits resolve short of trial. If that is true why not do it early?

26. NEGATIVE ATTRIBUTES OF MEDIATION (CONTINUED) • Might not get a satisfactory result. • Does not provide a win. • The result generally is some sort of compromise.

27.  Negotiation Private judging  Ombudsperson  Med Arb  Summary jury trial  Mini-trial

28. negotiation • Communication for the purpose of persuasion. • A process is which disputants communicated their differences to one another through conference, discussion and compromise in an attempt to resolve them.

29. PRIVATE JUDGING Process authorized in a few states (including California) whereby at the parties request a court can refer a case to a neutral of the parties choosing who will hear and decide the case. Normal rules of pleading, evidence, and discovery apply and the decision can be appealed on the record to the public courts as if it were decided in a public court

30. Ombudsman • A neutral or impartial manager within an organization who may provide informal and confidential assistance to managers and employees in resolving work-related concerns. • Office is located outside ordinary line management structures.

31. Med ARB Neutral is initially authorized to mediate a dispute and if the parties fail to negotiate a resolution is thereafter authorized to decide the dispute or any undecided issues. Abbreviation of terms mediation and arbitration.

32. SUMMARY JURY TRIAL • A non-binding abbreviated trial by mock jurors chosen from an actual or simulated the jury pool. • A judge or magistrate may preside. • Principals with authority to settle the case attend. • A resulting advisory jury verdict is intended to provide the starting point for settlement negotiations.

33. MINI-TRIAL • A private, voluntary, informal form of dispute resolution in which attorneys for each disputant make a brief presentation of his or her best case before officials for each side who have authority to settle. • Usually, a neutral, third party advisor is present at the hearing. • Following the attorneys' presentations, the principals attempt to settle the dispute. • The neutral third party may be asked to render a non‑binding advisory opinion regarding the dispute outcome if it were litigated.

34. THE COURTS • Authorized and funded by government to provide a neutral forum for the resolution of disputes between people and organizations

35. TYPES OF COURTS • TRIAL COURTS • Presentation of evidence • Determination of applicable law • Application of decided facts to applicable law

36. TYPES OF COURTS • Appellate Courts • Review of trial court record to ensure proper application of the law • Acceptance of facts offered in trial court • No evidence presented no jury present • California Supreme Court

37. TYPES OF COURTS • TRIAL – ROLE OF JUDGE AND JURY • Jury finder of fact. Judge determiner of law and instructions to jury • APPELLATE – ROLE OF JUDGES • Appellate Terms to know • Judicial review, brief, oral arguments, majority opinion, dissenting opinion, reversible error, reversal, remand, affirm, modify

38. The Federal Court System United StatesSupreme Court (Highest Appeals Court) Nine Justices; appointed for life; may refuse to hear a case; final authority Three judges hear each case, brought up from the District Courts. Lower Appeals Courts U.S. Court of Appeals for the Federal Circuit Hears appeals from specialized trial courts. U.S. Courts of Appeals (12 Circuits) Click on any box below for a definition of the jurisdiction of that trial court. U.S. District Courts U.S. Bankruptcy Courts U.S. Court of International Trade U.S. Tax Courts U.S. Patent & Trademark Office U.S. Claims Court Primary Trial Court Trial Courts of Limited (Specific) Jurisdiction Various Federal Agencies Trial Courts of Limited (Specific) Jurisdiction

39. The California Court System 7 justices-Appointed by Governor confirmed by Commission. Lawyer for 10 years Serve for 12 year term. Thereafter elected for additional terms. Supreme Court Courts of Appeal 6 Districts 105 Judges. Same methods & qualifications as Supreme Court Sit in 3 judge panels Superior Court One Court for each County Alpine County 2 judges Los Angeles County 8 Divisions at over 50 locations Electedby County voters for 6 year terms. Vacancies appointed by governor. Lawyer for 10 years 8.5 million cases annually

40. ADVERSARY NATURE OF US COURTS AND US LEGAL SYSTEM  Burden is on the parties to begin the process and to bring information to the attention of court. Essential requirement of a moving party.  Court is a neutral arbiter.-Primarily a processing agent.  Self-interest of litigants is thought to insure adequacy of information for the finder of fact to use.

41. ADVERSARY NATURE OF US COURTS AND US LEGAL SYSTEM (CONTINUED) •  Each party is independently responsible for presenting its case. • Competitors (litigants, parties, and advocates) are openly partial and biased for their side. •  A premium is placed on advocacy skills, being able to articulate ideas clearly and presenting information in both written and oral form, to convince decision-makers of the merits of a cause.

42. ADVERSARY NATURE OF US COURTS AND US LEGAL SYSTEM (CONTINUED) The counter system is an inquisitorial system. The judge investigates the dispute, questions witnesses and independently seeks out evidence. The attorney’s role is less critical to the administration of justice.

43. Jurisdiction • From Latin Juris and Dico meaning, “I Speak By the Law.” • When used in reference to the courts, the term refers to power and authority over a matter

44. JURISDICTION • Subject matter jurisdiction • Jurisdiction of the cause • Also refers to geographical boundary of an independent government unit

46. SUBJECT MATTER JURISDICTION  Power of the court to hear cases of a general class  Determinates Dollar amount pled Criminal action Remedy requested Nature of problem

47. The Litigation Process

48. Adversary System-remember • The party seeking redress initiates a lawsuit by filing a complaint, petition in equity or some form of motion

50. Initial Steps Retention of counselPleading -- plaintiff 1. Complaint 2. Summons 3. Service of process (obtaining jurisdiction) 4. Reply if necessary Pleading -- defendant 1. Answer 2. Demurrer or motion to dismiss 3. Cross-complaint or Counter-claim