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Archive for the ‘Court ADR Across the U.S.’ Category

New Jersey Legislature Tackles State’s High Foreclosure Rate

Nicole Wilmet, March 21st, 2019

Despite employing a number of practices in response to the mortgage crisis in 2008, New Jersey has had one of the highest foreclosure rates among all states since 2015. In a continued effort to address this issue, New Jersey Chief Justice Stuart Rabner established a Special Committee on Residential Foreclosures in 2017 to review current practices, policies, court rules and legislation and develop suggestions for reform. Last year, the Committee released its report, which summarizes the history and current state of foreclosure in New Jersey and includes recommendations for reform. Towards the end of their report, the Committee notes that not only do unresolved foreclosures lead to thousands of cases remaining on court dockets, but they also depress property values, burden municipalities and reduce tax revenues.

Building on the recommendations from the Committee, the New Jersey legislature is currently considering a ten-bill package that would reform the residential mortgage foreclosure process. Introduced at the end of January, this package of ten bills seeks to expedite the foreclosure process, decrease the amount of time foreclosed properties remain on the market, and make the foreclosure mediation program permanent. The following chart summaries each bill being considered.

Bill Number

Summary

S3411

Recommends revising the Fair Foreclosure Act (“FFA”) to require that notices of intention to foreclose are filed at least 30 days (but no more than 180 days) before foreclosure commences. Additionally, the bill also requires that these notices also include a notice to homeowners that they are entitled to housing counseling through the Foreclosure Mediation Program.

S3412

Requires the Department of Community Affairs to create a database with an interactive map that details the foreclosed properties in the state. To fund this database, this bill also establishes a $30 fee that would be collected when deeds are recorded.

S3413

Modifies the foreclosure process to expand the definition of what constitutes a vacant and abandoned property and requires that sales of foreclosed properties occur within 60 days of a foreclosure judgment.

S3414

Allows all common interest community associations to record liens for unpaid assessments.

S3415

Requires creditors and their in-state agents to file their contact information with the Superior Court.

S3416

Clarifies that the New Jersey Residential Mortgage Lending Act also applies to any out-of-state person involved in residential mortgage lending in the state.

S3417

Requires anyone acting as a mortgage servicer to obtain a license from the state Department of Baking and Insurance.

S3418

Reduces the statute of limitations for residential mortgage foreclosure actions under the FFA from 20 years to six years from the date on which the homeowner defaulted.

S3464

Focuses on expediting residential mortgage foreclosure proceedings. Under this bill, sheriffs would be required to conduct foreclosure sales within 120 days of receiving orders to foreclose.

S1244

Codifies the Foreclosure Mediation Program and makes several adjustments to the program. These changes include notifying homeowners about the program when they receive their intent to foreclose and again when a mortgage foreclosure complaint has been filed against a property. The bill also requires that these written notices must be available in both English and Spanish.

Although these bills have several more hurdles to pass before becoming law, their introduction indicates cooperation among the executive, legislative and judicial branches during the state’s foreclosure reformation.

Ohio Civil Stalking Mediation Pilot Shows Promise for the Future

Jennifer Shack, February 28th, 2019

In recent years, the Courts of Common Pleas around Ohio have been experiencing a sharp increase in civil stalking petition filings. In response, the Supreme Court Commission on Dispute Resolution decided to start a pilot mediation program for ten jurisdictions. The 18-month pilot ended in December. I was privileged to be asked to assess the pilot program so that the Commission on Dispute Resolution could make an informed decision about whether to continue the program and expand it statewide. Though data collection proved problematic, there was enough information to determine that mediation could be useful and safe for these cases, and that referral to mediation can significantly increase the number of settlements and decrease the number of full hearings held.

Civil stalking cases generally involve a pattern of behavior that isn’t serious enough to be criminal. The vast majority of cases involve people with a current or past relationship of some sort. In the Ohio pilot, almost half of the cases in which the relationship between the parties was reported, involved neighbors. Others were co-workers, former in-laws and ex-romantic partners.

Mediation in the Ohio pilot was voluntary, with referral generally occurring when the parties arrived for the full hearing. The counties differ as to who conducts the mediations, with some referring cases to independent mediators and some being mediated by a judge not associated with the case. For all cases, mediation is conducted in a shuttle format, with the petitioner and respondent in different rooms.

The reported number of mediations for the ten pilot programs ranged from 0 to 14, for a total of 52 mediations combined. The agreement rate for the 52 cases was 71%. Agreements tended to call for there to be no contact between the parties, with 12 of 15 containing only terms that were meant to keep the parties apart. Three, which involved neighbors, attempted to address the underlying causes of the conflict between the parties. They included terms such as keeping pets from the other party’s property, keeping common areas clean and removing lighting that encroached on the other party’s property.

While no contact agreements may be sufficient for cases involving ex-romantic partners or former in-laws, for those parties who are neighbors, it can be more challenging. For them, creative terms that address the underlying causes of conflict may be more effective in keeping those parties from later returning to court. I therefore recommended that future mediator training include methods for identifying underlying causes of conflict and helping parties to devise creative agreement terms that can address those causes.

Few parties completed surveys. Of the 10 parties who did, most were pleased with their experience and would recommend it to others. Most felt they had input into the outcome and all felt they had the opportunity to talk about most or all of their issues and concerns. In comments, the parties said mediation helped them by giving them voice and by allowing them to resolve their conflict without going to court. One surveyed party, who wanted a protection order, thought the mediation was a waste of time.

Three limited issues were also identified. A few ineligible cases were referred to mediation in one county. Of the ten parties surveyed in other counties, three believed that their mediation agreement was enforceable in court when it was not. Further, two of five parties who were asked whether they felt they could choose whether or not to mediate responded only “somewhat,” indicating that they didn’t have complete self-determination. These parties had been told of the opportunity to mediate by the judge hearing their case, and one indicated it was for this reason that she felt a little pressured to mediate.

In one county, enough information was provided to determine what effect mediation had overall. As cases were referred to mediation when they arrive for the full hearing, we can assume that without referral to mediation, those 44 cases in which the parties arrived at the full hearing would not have settled and would have proceeded to a full hearing. As 19 of the 44 cases were referred to mediation, and only two of those continued to a full hearing, mediation referral had the effect of reducing the number of full hearings from 44 to 27, or by 38%. Further, 11 of the cases referred to mediation resulted in an agreement. With 12 cases settling prior to the full hearing, this means that referral to mediation almost doubled the number of settlements to 23.

The data from the above county indicates that mediation of civil stalking cases can have an impact similar to that of mediation for other types of cases, with about 20% of cases filed being referred to mediation and 11% being settled through the process. It can also safely address the needs of the parties – to have voice and to avoid court. When implementing this type of program, courts should be aware of possible pitfalls, including party misunderstanding of agreement enforceability and the impact of judge referral on parties’ belief that they can choose to mediate.

New California Law Requires Attorneys to Obtain Consent from Parties Regarding Mediation Confidentiality

Nicole Wilmet, February 27th, 2019

A new California law now requires attorneys to provide written disclosures to and obtain consent from their clients regarding California’s mediation confidentiality restrictions. The new law, effective January 1, 2019, applies to all civil cases except class actions. Under the new law, as soon as reasonably possible before a client agrees to participate in mediation or pre-mediation consultation, attorneys must provide their client with a written disclosure that identifies the confidentiality restrictions related to mediation. These written disclosures must be in at least 12-point font and be printed in the preferred language of the client. Additionally, these disclosures must be a single page document that is not attached to any other document provided to the client and be signed by both the attorney and the client.

The impetus behind this new law is to ensure that clients understand the expansive reach of mediation confidentiality. In California:

  • all communications, negotiations or settlement offers that occur during the course of mediation are confidential;
  • any statements made and writings prepared in connection with a mediation are not admissible as evidence or subject to discovery;
  • mediators may not be compelled to testify in any subsequent civil proceedings about any communication or conduct that occurred during or in connection with a mediation; and
  • a mediator’s report, opinion, recommendation, or finding about what occurred during the mediation may not be considered by a court.

In addition to improving understanding by requiring written disclosures, California’s new law is also a step by the legislature to address a policy concern identified by California courts regarding mediation confidentiality and attorney disciplinary action. See Cassel v. Superior Court, 51 Cal. 4th 113 (2011)(in which the Court held that a party was barred from disclosing private attorney communications, that were made during the course of a mediation, as evidence in his attorney malpractice suit).

In response to Cassel, in 2012 the California Legislature passed a resolution that directed the California Law Revision Commission (“CLRC”) to evaluate the relationship between mediation confidentiality and attorney malpractice. In 2017, after five years of studying the issue, the CLRC released its recommendation which encouraged creating an exception that would allow attorneys to be held accountable for mediation misconduct. Ultimately, the final language adopted by California’s new law permits the disclosure of communication in an attorney disciplinary proceeding to prove attorney compliance with written disclosures only if the communication does not disclose anything said or done during the mediation.

Connecticut Launches Online Dispute Resolution Program

Nicole Wilmet, January 29th, 2019

This month, Connecticut launched an online dispute resolution pilot program to resolve contract collection cases in the Hartford and New Haven Judicial Districts. This article reports that participation in the program is voluntary and that either party may opt-out of participating within 15 days of referral to the program. In both the notices to plaintiffs and defendants, the court notes that by participating in the program, both parties agree to give up their right to: a jury trial, file an appeal from the court’s decision, and to object to evidence presented by the either party.  

Plaintiffs wishing to participate in the ODR program must include an Online Dispute Resolution Answer Form and an Online Dispute Resolution Notice to Defendant with their complaint. Should both parties agree to participate in the program, the court will then give each side deadlines to exchange evidence and file evidence with the court. The court notes that examples of evidence in these cases include receipts, repair orders, warranties, cancelled checks, etc. Next, parties will be scheduled for a mediation session with a court mediator by video, telephone conference or in person. In the event that the parties are unable to reach an agreement, the court decides the case based on the papers that both parties have filed.  

Additional information about Connecticut’s new ODR program may be found on the court’s site or by emailing ODR@jud.ct.gov