Alternative Dispute Resolution in Texas - Trends and Tips

According to statistics from the Texas Office of Court Administration, the number of civil lawsuits tried to jury verdict has steadily declined over the years while the number of lawsuits filed annually has increased. One explanation for this trend is the use of alternative dispute resolution methods by civil litigators. Secondly, pretrial mediation is mandatory in virtually every civil trial court in the State. Alternative Dispute Resolution has thus emerged as the preferred method of resolving disputes by corporate defendants due to its time and cost-saving benefits as well as its flexible implementation due in part to advanced technology. Today, litigators have several options available to facilitate settlement negotiations ranging from traditional to controversial.

The most familiar and popular option is the "traditional" mediation in which the parties to an ongoing, litigated dispute allow a neutral third-party, usually a seasoned attorney, to hear their positions with all parties appearing in person. The mediator analyzes the value of the case based on several factors and if all goes well, facilitates a compromised settlement. In recent years, however, mediation has been modernized to incorporate the use of technology to accommodate litigant's busy schedules and to save money, particularly in smaller cases.

Summary Jury Trial

Although used infrequently, the summary jury trial is another viable dispute resolution method. The evolution of the summary jury trial emerged in part, from courts' desire to improve case management and decrease the backlog of cases that remain on judges' dockets awaiting trial. The summary jury trial is a pared down version of a full-blown jury trial. Texas permits summary jury trials under Section 154.026 of the Texas Civil Practice and Remedies Code, which creates a "forum for early case evaluation and development of realistic settlement negotiations."[1] In a summary jury trial, each party and their counsel present their position to a panel of six jurors, unless the parties agree otherwise. After receiving all of the evidence, the jurors, impaneled from the regular jury pool that would have been used to seat a jury in a full trial, may issue a liability and/or damages "verdict." As a safeguard against contrived deliberations and improbable verdicts, jurors are not told if their decision is binding on the parties. Following the verdict, the parties and their attorneys can question the jurors about their deliberations.

The parties generally complete trial in one day. Since the parties receive a preview of what a real jury would do at trial, it becomes a useful starting point for further settlement negotiations.

Teleconference Mediation

There is no doubt that in today's society, businesses conduct a large portion of their communication using video-conferencing. Once a novel concept, videoconferencing has become common place in maintaining contact with national and international business associates, clients, and company employees. The legal profession has also seen an uptick in teleconference driven alternative dispute resolution. Teleconferencing is particularly ideal when the parties to a dispute are in different states, the presence of high-level busy company executives is either required or mandated, and conflicting schedules create long delays in getting to mediation. It also resolves the uncomfortable problem created by people who do not deal well with face-to-face confrontation. During teleconference mediation, the parties present their case to the mediator in much the same way as they would if they were appearing in person. The difference is that the parties appear virtually on computers set up in separate rooms in the mediator's office. The mediator then visits each room and facilitates negotiations, relaying the parties' offers and counteroffers. Settlements are reached in the same way as a traditional, in-person mediation. One big advantage to this method is that it allows the parties to remain on their own "turf" while negotiating. A variation on this form of dispute resolution is telephonic mediation, without video, which essentially works the same way except that the parties call in to present their positions and settlement offers. The entire process is done via telephone calls to the mediator.

One key to a successful teleconference mediation is having the right software and reliable computer equipment with compatible audio features. The cost of teleconference services varies and can be hourly, per party, or a combination of the two. Taking into consideration the decrease in travel expenses, increase in company productivity, and elimination of travel time, the convenience of this method of dispute resolution cannot be understated. Also on the horizon is "virtual mediation" which consists of negotiating via text, live chat, and email. With the popularity and ease of use of programs like Skype, FaceTime, and GoToMeeting, videoconferencing is becoming an increasingly popular mediation alternative.

Cyber Mediation

One innovative approach to dispute resolution is the use of "cyber space" to assist litigants in resolving disputes. Using a secure website, parties who agree to mediate virtually submit confidential settlement offers to the website. Before submitting any offers, the parties agree in advance that if their offers are within a certain percentage or dollar amount, they will split the difference and reach a settlement. If the offers are not within the percentage or dollar amount agreed, the offers are never disclosed and there is no settlement. The fee for this service is dependent on whether the parties reach a settlement and usually has a maximum fee per party. According to the Dispute Resolution Magazine, the success rate for this form of mediation is slightly lower than traditional face-to-face mediation. Although not as popular in Texas, this is a viable dispute resolution alternative for cases with simple, straightforward facts, clearly defined minimal damages, and unrepresented claimants whose goal is expeditious resolutions.

Rent-A-Judge

A more controversial alternative dispute resolution method is the private judge, also known as the "rent-a-judge." The concept is more widely used in California. However, there is no shortage of advertisements offering the services of former judges as impartial mediators in Texas. Effective use of this method necessarily requires that the parties enter into a written agreement to "Rent-A-Judge" early on in the litigation. Similar to Arbitration and depending on the scope of agreement, pre-mediation discovery can be as limited or expansive as the parties' desire. Additionally, the parties can elect to have the actual proceeding governed by trial-like procedural and evidentiary rules, and may include a provision entitling them to an appeal. This form of alternative dispute resolution affords greater autonomy to the parties in controlling the final disposition of the case and to structure the proceeding to match the needs of the case. Unlike the random judge selection used by the courts, the parties can agree to selection of the presiding judge and base their decision on the judge's knowledge, background, and relevant expertise in the predominant issues underlying the case. One disadvantage is that contracting with a former judge is likely cost-prohibitive for litigants with limited financial resources.

While there is no guarantee that every case can or should reach a settlement, the best way to determine whether there is a realistic possibility of a resolution is to consider the variety of available alternative dispute resolution methods to assist in breaking down perceived barriers to settlement. While not intended as an exhaustive list, the unique factors of each of the above methods may be precisely what parties embroiled in a legal dispute need to take a realistic view of the strengths and weaknesses of their case.

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