Privacy, Business and Law

In the California courts, if the judge is of the opinion that the amount in controversy in a case does not exceed $50,000, the judge may order to parties to arbitration. The plaintiff can also elect to go to arbitration by agreeing to limit the award in a case to the $50,000 maximum. A hearing is then conducted before an arbitrator, not a judge. A party who is dissatisfied with the ruling has the right to demand a trial de novo, i.e., a new trial before a judge or jury in the usual manner. There is no comparable procedure in the federal courts.

The general rule is that the prevailing party in a lawsuit does not have the right to recover attorney fees unless they are provided for by a contract or by the statute under which the case is brought. (Read more…)

Very little. In both state and federal courts, a party may make a motion asking the judge to recuse (disqualify) himself or herself, but under very limited circumstances. Examples of grounds for recusal include that the judge has personal knowledge of the facts in a case, has a financial interest in the outcome of a case, or has certain types of connections with the parties or their attorneys. In addition, California Code of Civil Procedure section 170.6 gives each party to a lawsuit the right to raise a peremptory challenge to any judge who that party believes may be prejudiced. The challenge must be raised within ten days after the judge is first assigned to the matter. In considering whether to challenge a judge in California Superior Court, it is important to remember that a judge assigned at the commencement of a case is often not the judge to whom a case will be assigned for trial.

Only two types of cases are eligible to be decided in federal court. “Diversity Cases” are disputes between citizens of different states, in which the amount in controversy exceeds $50,000. “Federal Question” cases involve claims for relief under federal statutes. Examples of these include the Lanham Act (trademark violation and unfair trade practices), Securities Act of 1934, Americans With Disabilities Act, Fair Debt Collection Practices Act and many others. A party to a case commenced in state court may have the right to “remove” (i.e., transfer) the case to federal district court. There are many differences between federal and state litigation which will influence the choice between state and federal court, including the size and composition of juries, application of procedures such as summary judgment, etc.

You will be face to face with the other party to the dispute across a conference room table. Their lawyers will be present. The sessions often begin with a presentation by each side (usually through the lawyers). The mediator will usually ask questions, and this is often when the parties themselves begin to participate. Following this initial joint session, the mediator or the parties usually request that a private caucus take place between the mediator and each party and their attorney. What sometimes (not always) results may resemble “shuttle diplomacy” in which the mediator can act as a go-between.

It is almost always helpful for both sides to prepare position statements (sometimes referred to as “mediation briefs”) to submit to the mediator in advance of the mediation. A common question is whether these statements should be given in confidence to the mediator or served on the other parties. It is usually preferable to share mediation statements with the other side. The mediator does not make the decision. The goal is to convince the other side that a settlement is in their best interest. Parties to mediations are often called upon to speak their minds, often directly to the other parties. This is not a mandatory requirement, but it often helps the parties understand things about the dispute that can assist in resolving the conflict. Do not prepare a speech. Do be prepared to speak your mind, and to listen.

California Evidence Code section 1119 provides that nothing is said or admitted at a mediation, and no writing prepared in connection with a mediation, can be admitted as evidence in court or obtained by a subpoena or otherwise in discovery. However, “you can’t un-ring a bell.” Facts revealed during a mediation can be used to your disadvantage by an adversary later if the mediation does not resolve the conflict. You should discuss with your lawyer what should, and shouldn’t, be revealed during a mediation.

Mediation is often confused (even by some mediators) with the traditional settlement conference, which usually takes place before a judge. In a settlement conference, the “settlement judge” is likely to express ultimate opinions on the merits of the case or the reasonableness of a proposed settlement. In contrast, mediation encourages the parties themselves to form opinions by listening and speaking. A mediator is a facilitator whose job is to empower the parties to reach their own agreement for their own reasons.

In a court case, the parties have a right to conduct extensive, and expensive pre-trial procedures. Discovery, a process designed to uncover the facts about the case, usually includes depositions and written interrogatories that must be answered under oath. Also, the parties have the right to file pre-trial motions (such as demurrers and summary judgment motions) that are designed to winnow out legally insufficient and weak cases before trial. In contrast, in arbitration the arbitrator is in control of the process, which is tailored to the type of dispute and the amount in issue. In the average arbitration matter, pretrial discovery is very limited and motions are usually not permitted, unless both sides agree that they are necessary. The normal rules of evidence (such as the exclusion of hearsay, for example) do not apply in arbitrations. Unlike a court case, an arbitrator’s decision is essentially final. An agreement to arbitrate waives the right to trial by jury. There is no right to appeal or obtain any judicial review of the decision. Parties who are in position to negotiate the content of an arbitration clause in their contract can agree to change all of these rules. The most common changes are provisions for discovery and rights of appeal to the Superior Court for review of legal errors.

The difference is in who resolves the conflict. In arbitration, the parties (usually through their attorneys) present their case to a third party neutral (the arbitrator) who renders a decision in much the same way as a judge would in more formal court proceedings. The parties agree in advance whether the decision of the arbitrator will be final (“binding arbitration’) or whether there is an option for either or both parties to reject the decision. In mediation, the third party neutral (the mediator) does not make the decision. The conflict is resolved only through the voluntary agreement of the parties, with assistance from their attorneys and from the mediator.