Divorce Arbitration

An article by Jane Gross in today's NY Times describes a growing trend for divorce settlements in the state of New York via a process called "collaborative divorce". Leery of costly ligitation and a drawn-out legal battle, many couples are opting to negotiate with each other with the help of lawyer-advocates, avoiding the state courts. Protocols are such that there are additional incentives on both sides of lawyers to settle cases privately.

The cornerstone of the process ? and its most controversial element ? is that the two lawyers sign a pledge to withdraw from the case if either of their clients decides to go to court. This gives the lawyers an economic incentive to leave adversarial habits behind. It also encourages clients to stay at the bargaining table, since bolting means starting over with new counsel.

It appears that the trend toward collaboration is moving to other parts of law.

Within six months of the training of half the lawyers in 2000, the filing of motions fell by 50 percent. By 2001, after the next group was trained, filings had fallen an additional 25 percent. Collaborative techniques are now being tried in Medicine Hat by corporate, real estate and trust lawyers.

There is a clear difference between dispute resolution in public and private domains. Public dispute resolution is nearly always a winner-takes-all game, because coercion is used to back up verdicts. Judges are not working for a profit, and thus, do not have to please both parties in order to attract future business.

In contrast, lawyers specializing in collaborative legal resolution have to build reputations not just for being strong advocates for their clients, but also for expeditious resolutions without the usual emotional nastiness and financial trauma that accompanies state-based divorce proceedings.

The ideal resolution to a divorce dispute should leave both parties with at least some degree of satisfaction. The state legal system is loaded with incentives against this type of bilateral benefit.

How can private legal collaboration grow to involve more and more areas of dispute resolution? The incentives for collabortion have to grow, and the transaction costs of negotiation have to decline.

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But how long until one of

But how long until one of these agreements calling for lawyers to withdraw upon the filing of suit is rendered void by a court? On one hand, the two parties on each side go into the situation knowledgably. On the other hand, it would be too easy for a client to bring a malpractice suit against their lawyer for failing to get an adequate resolution as a result of their desire to avoid court. In many ways ADR is a great thing, but when it potentially pits the client's interests (getting the best settlement/judgment) against his lawyer's interests (maximizing fees by staying out of court), then danger lurks.