MEMORANDUM
Date: Revised March 12, 2003
To: Commissioner Palmer DePaulis
From: David Stice, student intern
RE: State ADR Program: Summary of ADR-related Utah Code
EXECUTIVE SUMMARY
Utah Agencies have broad authorization to resolve disputes under the Government Dispute Resolution Act, Utah Code 63-46c-101, et seq. Agencies may develop and adopt Alternative Dispute Resolution (ADR) procedures in accordance the Utah Administrative Rulemaking Act, Utah Code 63-46a. Where agencies elect to develop and adopt ADR procedures, they are obligated to consider a number of elements including public access to the ADR process, neutrality and availability of ADR providers, objective criteria for qualification of ADR providers, the voluntary nature of ADR, ADR process agreements with interested parties, provider’s or neutral’s conflicts of interest, agency ADR coordinators and their duties, and confidentiality requirements applicable to ADR procedures.
The Government Dispute Resolution Act defines ADR providers to be those people who meet the qualifications established by rules of the Judicial Counsel under the Alternative Dispute Resolution Act, Utah Code 78-31b-5. Agencies may have the authority to utilize “Neutrals” (as distinct from “Providers”) who are subject to different qualifications to conduct agency ADR proceedings. This issue, if important, may need further research and clarification.
The confidentiality provisions of the Alternative Dispute Resolution Act (Utah Code 78-31b-8) are incorporated by reference into agency requirements. These provisions seek to promote the effective use of ADR by authorizing certain protections of information disclosed during mediation and imposing specific obligations and immunities for the parties involved in mediation.
The Judicial Code addresses arbitration and mediation procedures applicable to Court-Annexed ADR. The Utah Courts have issued Utah Rules for Court-Annexed Alternative Dispute Resolution which address:
Conduct of mediation proceedings;
Conduct of non-binding arbitration proceedings;
Confidentiality of non-binding ADR under 78-31b-8; and
A code of ethics for ADR providers.
Benchmark elements from the Rules for Court Annexed ADR are enumerated below for comparative purposes only. These elements are not strictly applicable to agency procedures.
In summary, Agencies may adopt flexible, consistent procedures for development and implementation of ADR, as long as certain elements of procedure, confidentiality, and ADR provider qualifications are addressed. The adoption of the minimal, necessary procedures may promote the acceptance and success of agency ADR. The information presented in this memo is intended to help identify what the necessary and appropriate elements are.
INTRODUCTION
As part of my search for model Alternative Dispute Resolution (ADR) procedures pertaining to agency dispute resolution, I have compiled a summary of relevant sections of the Utah Code. This summary examines the general requirements and authorizations currently present in the Utah code and how those requirements may affect ADR procedures under consideration by Utah agencies. In addition, the Utah Rules for Court-Annexed ADR and the authorizing Alternative Dispute Resolution and Utah Arbitration Acts are summarized to provide a benchmark for possible elements of agency procedures.
This memorandum specifically discusses the following parts of the Utah Code:
Government Dispute Resolution Act, Title 63, Chapter 46c, §101 et seq;
Alternative Dispute Resolution Act, Title 78 Chapter 31b, §§ 1 through 8
Utah Arbitration Act, Title 78 Chapter 31a
The following sections will need to be considered in developing and adopting ADR procedures, but their procedural requirements are not evaluated in this memo:
Utah Administrative Rulemaking Act, Title 63, Chapter 46a
Utah Administrative Procedures Act, Title 63, Chapter 46b
Other code or Utah Administrative Code sections which may affect development and implementation of agency ADR procedures, but which I have not addressed, may include:
Public Utilities, Damage to Underground Utility Facilities, Title 54 Chapter 8a, §8.5, and Utah Administrative Code R746-200-7 and R746-240-7;
Real Estate, Utah Relocation Assistance Act, Title 57, Chapter 12, §14;
State System of Public Education, Dispute Resolution, Title 53A, Chapter 7, §§101,102
Government Records Access and Management Act, Title 63, Chapter 2
Judicial Code Sections 78‑3a‑305, 78‑3a‑405, 78‑31a‑14, 78‑3a‑109(9), 78‑3a‑314, 78‑3a‑305 or 78‑3a‑405;
Alternative Dispute Resolution Providers Certification Act, Title 58, Chapter 39a.
Labor Commission arbitration §34A-1-103
Partnership, single partner §48-1-6
Public transit labor disputes §17A-2-1032
Water dispute, informal arbitration by St Eng, §73-2-16
Firefighter’s arbitration §34-20a-7 to 9
Utah Tax Commission, Utah Administrative Code R861-1A-32
Utah Health Care Malpractice Act, Utah Code Annotated § 78-14-1 et. seq.
GOVERNMENT DISPUTE RESOLUTION ACT
The Government Dispute Resolution Act is presented in Utah Code 63-46c-101 et. seq. Section 102 defines terms for that chapter, including ADR, ADR Provider and Neutral. “ADR” is defined to include any process other than litigation to resolve disputes. An “ADR provider” means a Neutral who meets the qualifications established by Judicial Counsel rules under authority of Utah Code 78-31b-5, and may be either an employee or contractor. A “Neutral” is defined distinctly from an ADR provider to be a person who holds himself out to the public to be qualified and trained in the use of ADR to resolve disputes. Thus, the agencies have broad latitude in the type(s) of ADR which they may employ to resolve disputes. Where the agencies use “ADR Providers”, the providers must be qualified under Judicial Code rules authorized by Utah Code 78-31b-5. Qualification standards are described under Rules of Judicial Administration 4-510(11). Whether the same requirement for such qualification applies to a “Neutral” is less clear, but the act appears to distinguish “providers” from “neutrals.”
Section 103 of the Act describes the requirements for ADR procedures. An agency may use ADR procedures with consenting, interested parties to resolve any dispute involving nearly any agency action, including adjudications, enforcement, permitting, licensing, policy development, and contract administration. The agency may develop and adopt procedures governed by rules in accordance with the Utah Administrative Rulemaking Act, Utah Code Title 64 Chapter 46a. In developing and adopting an ADR procedure, the Agency is obligated to consider the following:
1) The public interest in open access to and neutrality of the ADR provider or neutral; and in providing for a broad selection of ADR providers or neutrals.
2) Creating objective criteria for qualification of ADR providers or neutrals to conduct agency ADR procedures.
3) Consistency of ADR procedures with the Utah Administrative Procedures Act, Utah Code Title 63, Chapter 46b.
4) That ADR procedures are voluntary and may be used at the discretion of the agency or, where an agency has adopted ADR procedures, at the request of interested parties.
5) The requirement for an agency to develop an ADR process agreement with interested party(s) that provides for: appointment of an ADR provider or neutral whose appointment is agreed upon by all parties; that specifies limitation periods for commencement or conclusion of formal administrative or judicial proceedings and, if applicable, that specifies time periods which parties have agreed to waive; and that sets forth how costs and expenses will be allocated among parties.
6) An ADR provider or neutral selected in accordance with (5) shall have no official, financial, or personal conflict of interest with any issue or party, unless fully disclosed in writing to all parties and the parties consent. The Agency may make rules in accordance with Utah Administrative Rulemaking Act (Title 63, Chapter 46a) to develop standards to assure neutrality.
7) Any agreement under (5) may be included in an enforcement order, stipulation, contract, permit, or other document entered into or issued by the agency.
8) The agency head may designate an employee as the ADR coordinator. An ADR coordinator shall: (a) make recommendations to executive staff on issues and disputes that are suitable for ADR, (b) analyze the agencies enabling statutes to determine impediments to ADR and suggest modifications; (c) monitor use of ADR procedures, (d) arrange for training of staff in ADR procedures, and (e) inform the staff and public about agency ADR procedures.
9) The agency may employ or contract with a neutral, ADR provider, other agency or private entity for necessary services on a case-by-case, service, or program basis.
10) ADR procedures are subject to confidentiality requirements under Judicial Code 78-31b-8.
Nothing in the Government Dispute Resolution Act or in Dispute Resolution procedure agreements shall limit other dispute resolution procedures available to agencies or deny interest parties their rights granted under federal or state laws, including rights to administrative or judicial hearings.
CONFIDENTIALITY
In general, authorizing statutes seek to promote the effectiveness of ADR procedures by requiring closed processes, prohibiting recordation of the process, immunizing the process and disclosed information from discovery, and imposing confidentiality obligations on all participants to the process.
The confidentiality provisions under Judicial Code 78-31b-8 are incorporated into agency procedural requirements by reference. These provision hold that the procedures are to be conducted in a manner to encourage informal and confidential exchange of information among parties to facilitate resolution of the dispute. Procedures are to be closed unless the parties consent otherwise and are not to be recorded.
No evidence concerning the fact, conduct, or result of an ADR proceeding is subject to discovery or admissible in any subsequent trial of the same case or issue between disputants.
Information from the ADR procedure is not admissible unless discovered from sources independent of the ADR procedure.
No parties, neutrals, or other attending persons may disclose or be required to disclose any information obtained in the course of an ADR procedure unless waived by all other participants.
ADR providers may not disclose or discuss any information with an outside party of the proceeding, including a trial judge, except where:
It is the director (of Dispute Resolution Programs within the Administrative Office of the Courts) doing so for the purpose of training, program management or program evaluation;
It is an ADR provider consulting with a peer and identification of disputants is rendered anonymous.
Confidentiality does not limit or affect the responsibility to report child abuse or neglect under Section 62A‑4a‑403.
No records under the Alternative Dispute Resolution Act or the Utah Arbitration Act shall be subject to Government Records Access and Management Act, except settlement agreements filed after conclusion of the ADR procedure or awards filed after the period for appeal has expired.
ADR PROVIDER QUALIFICATIONS
The Government Dispute Resolution Act defines ADR Providers to mean a neutral person who meets the qualifications established by Judicial Council Rules (Utah Code 63-46c-102(4)(i)). It is less clear that a “Neutral” as defined in 63-46c-102(7) must meet the same qualifications. The terms “provider” and “neutral” are used in disjunction throughout the Act, suggesting that the legislation makes a distinction between the two.
Rule of Judicial Administration 4-510(3) establish the qualifications for ADR providers. To be eligible for the Court roster of ADR providers, applicants must:
1) Submit a written application presenting their formal training and experience, major areas of specialization, maximum fees to be charged, judicial districts in which the provider will serve; and location of facilities where ADR proceedings will be conducted;
2) Agree to complete annual ADR training as required and offered by the Judicial Council;
3) Submit annual reports to the Director of Dispute Resolution, Administrative Office of the Courts;
4) Pass an examination on the Code of Ethics for ADR providers;
5) Agree to conduct three pro bono mediations annually; and
6) Be of good moral character, as so defined by the rules.
Qualifications for arbitrators include membership in the Utah State Bar for 10 years, or demonstration of training, education, or experience which the Council finds will promote the effective administration of the ADR program.
Annual recertification of mediators and arbitrators to the roster requires the conduct of a certain number of mediation or arbitration sessions respectively during the past year.
JUDICIAL CODE
The Alternative Dispute Resolution Act and the Utah Arbitration Act are found within the Judicial Code for the State of Utah (§§ 78-31b-1, et seq, and 78-31a-1, et seq, respectively). Key functional differences between these Acts and the Government Dispute Resolution Act are discussed herein.
The Utah Alternative Dispute Resolution Act is for the purpose of providing alternative or supplement dispute resolution procedures in civil court actions. Only those procedures authorized by the Judicial Council meet the definition of Alternative Dispute Resolution. A Director of Dispute Resolution Programs is appointed and located within the Administrative Office of Courts. ADR providers are immune from all liability when conducting procedures approved by the Judicial Council, except for failure to maintain confidentiality. The Director reports annually regarding number and types of disputes, methods to which the dispute was referred, status or disposition of disputes, and administrative problems.
Judicial Council rules for ADR procedures are required to accomplish the following:
Orient parties & counsel to ADR,
Identify types of civil actions that qualify for ADR,
Ensure no prejudice for parties that opt-out of ADR,
Exempt cases for which ADR is not appropriate,
Create a timetable to avoid undue delay or expense,
Establish qualifications for ADR providers,
Establish a code of ethics for providers and a means for its enforcement,
Authorize sanctions for failure to participate in good faith,
Assess and permit waiver of fees, and
Allow vacation of an award.
Minimum procedures for arbitration include documentation and enforcement of an award, appeal or nullification of an award, and referral to arbitration under the Utah Arbitration Act (Utah Code 78-31b-6) . Minimum procedures for mediation provide for referral of any case to mediation for which Judicial counsel has a program, grant of parties objection for good cause, execution of the dispute resolution agreement in writing and its enforcement as judgment, and restriction of agreements to those which would be eligible for a court order (Utah Code 78-31b-7). Appropriation of funds to the Court-Annexed ADR program is mandated from a restricted account funded from court fees collected under Subsections 78‑7‑35(1)(a) through (e), (1)(g), and (1)(r) (Utah Code 78-31b-9)).
UTAH RULES FOR COURT-ANNEXED ADR
In response to the enabling statute for Court-Annexed ADR, the Code of Judicial Administration promulgates four rules which address (1) conduct of mediation proceedings; (2) conduct of non-binding arbitration; (3) confidentiality of non-binding ADR under Section 78-31b-8, and; (4) a code of ethics.
Specified conduct of mediation includes a process for selection of mediators from the Court Roster of providers in accordance with Code of Judicial Administration Rule 4-510(11).
A pre-mediation conference is required at which the schedule is set, parties are informed of their right to withdraw from mediation, and parties are permitted to agree to discovery. During mediation conferences, ADR providers may conduct separate consultation with the parties.
Information disclosed to the mediator on a confidential basis may not be disclosed to the other parties without the disclosing party’s consent.
Where settlement is reached, the parties or the mediator shall prepare and execute a written settlement agreement to be filed with the Court.
If less than all the issues are resolved, the parties may execute a stipulation regarding those issues resolved and identifying those issues left unresolved.
Discovery may continue during mediation proceedings except as stipulated by the parties. Third party evidence may be subpoenaed in accordance with the Utah Rules of Civil Procedure.
Where the mediator determines that the parties are unable to participate meaningfully or a reasonable settlement is unlikely to be reached, the mediator may terminate the process without explanation. The parties may terminate the process at any time.
The court may order absent parties to show good cause for their absence and why sanctions for their absence should not be imposed. Parties may agree to submit the matter to arbitration anytime before settlement.
Rules for non-binding arbitration reflect the closer similarity of arbitration to adjudication through particular requirements for management, evidentiary, and judgment issues. In brief, these rules address:
1) selection of the arbitrator in accordance with Code of Judicial Administration Rule 4-510(11);
2) Pre-hearing conference at which the schedule is set forth, issues are narrowed, the scope and timing of discovery is defined. Stipulation of admission of facts and documents may be reached and presentation of written and oral testimony through time-saving tools and procedures is encouraged.
3) the arbitrator’s power to make interim procedural orders for the furtherance of arbitration;
4) procedures for submission of exhibits and objection thereto prior to the arbitration conference;
5) stay of discovery during arbitration proceedings;
6) Procedures for recordation of the arbitration hearing;
7) the Arbitration hearing, including administration of oath, mode, order, and time allotment for presentation of issues, arguments, and evidence; and burden of proof.
8) Parties’ entitlement to present evidence and the arbitrator’s authority to conduct inspections or investigations outside of the hearing.
9) Admissibility of evidence in accordance with Utah Rules of Evidence or otherwise where the arbitrator finds it to be relevant and credible and not unfairly prejudicial or in violation of any rule of privilege.
10) Privacy and confidentiality of arbitration proceedings;
11) Procedures for the arbitrator’s preparation and filing of an award, for its treatment as a stipulation between parties, and for the parties’ request for trial de novo.
Confidentiality requirements of Section 78-31b-8 are reiterated in Rule 103 for Court-Annexed ADR.
A Code of Ethics for ADR providers is the concluding rule for Court-Annexed ADR. The Code of Ethics presents eight Canons which describe the duties of providers with regard to the following issues:
1) Integrity and fairness of the process;
2) Disclosure and disqualification;
3) Fair and diligent conduct of the proceedings;
4) Faithfulness to trust and confidentiality;
5) Prohibition against invidious discrimination;
6) Arbitrator’s just, independent, and deliberate decision;
7) Arbitrator’s obligation to avoid impropriety;
8) Process and terms of settlement in Mediation.
In summary, the Code of Judicial Administration establishes procedural rules for implementation of the Alternative Dispute Resolution Act and the Utah Arbirtration Act through Court-Annexed ADR. These rules may provide a benchmark for State Agency ADR procedures but are not strictly applicable to agency conduct of ADR proceedings.