Delighted to post this commentary from FOI Nancy Welsh:
I wonder whether anyone noticed the mention of mediation last week during oral arguments before the Supreme Court in the case of Kindred Nursing Centers v. Clark. The question in this case is whether the FAA preempts a state-law contract rule (here, Kentucky’s rule) that singles out arbitration by requiring a power of attorney to expressly refer to arbitration agreements before the attorney-in-fact can bind her principal to an arbitration agreement.
It doesn’t seem as though this question would give rise to any mention of mediation. Not so. According to Professor Ronald Mann, reporting for SCOTUSBLOG on the oral argument, several justices asked questions demonstrating a “widely shared skepticism that the Kentucky opinion could be read as an evenhanded treatment of arbitration[,]” and Justice Breyer in particular posed hypotheticals that required Clark’s attorney to compare Kentucky’s treatment of arbitration with its treatment of other dispute resolution procedures. According to Professor Mann:
He [Justice Breyer] pressed two of his typically extended hypotheticals. The first one asked whether a contract that granted an attorney the right to litigate a dispute would include the right to seek a bench trial or mediation, both of which would involve a waiver of the right to a jury trial. When Salyer [Clarks’ attorney] answered that the attorney’s authorization would include a right to make those strategic decisions, Breyer responded pointedly: “I will tell you in my opinion right now you have discriminated against arbitration.”
Justice Breyer later added, “It seems to me that arbitration as a means of settlement of a … dispute, mediation as a means of settling a dispute, a judge as a means of settling a dispute, are equally and no different in the respect that none of those three involves a trial by jury.”
Do you see any problems with the parallel that both Professor Mann and Justice Breyer drew here between arbitration and mediation? According to Professor Mann, “a contract that granted an attorney the right to litigate a dispute would include the right to seek a bench trial or mediation, both of which would involve a waiver of the right to a jury trial.”
But a contract providing for mediation does not guarantee there will be a settlement–and because the parties could decide not to settle, they could very easily proceed to a jury trial. Thus, an agreement to mediate, unlike an agreement to arbitrate, should not be understood as representing a waiver of the right to a jury trial.
Mediation and arbitration are related, no doubt about it. But they are not—and should not be understood as—the same. One is adjudicative; the other is consensual. Of course, much depends upon how a mediation is conducted, whether its cost is so high that it becomes a serious barrier to continued litigation, and whether it is a med-arb rather than a mediation.
This is territory we’ve covered before, but it is not known as widely as it should be. Indeed, this represents an example at the very highest level of misunderstanding and demonstrates why it is so important to ensure that all lawyers and judges have at least a basic understanding of the continuum of dispute resolution processes.
