[ADR] District of Arizona

District of Arizona

IN BRIEF

Process summary

ADR generally. In its CJRA plan, effective December 1, 1993, the District of Arizona states that it "wholeheartedly supports alternative dispute resolution mechanisms" in civil cases and encourages judges and counsel to consider referring appropriate cases to ADR. In addition to the ADR and judicial settlement options noted below, the court authorizes referral of cases to private ADR providers if all parties consent. The court is also experimenting with settlement conferences in criminal cases.

Arbitration. The District of Arizona is one of the ten pilot districts authorized by 28 U.S.C. งง 651-658 to provide voluntary, nonbinding court-annexed arbitration. See below.

Judicial settlement conferences. District judges commonly refer cases to magistrate judges for settlement conferences. Settlement conferences may also be conducted by visiting judges or district judges other than the assigned judge. Cases are referred to mandatory settlement conferences by court order.

Of note

Obligations of counsel. The district's standard case management order requires counsel to confer before the initial scheduling conference regarding the case's suitability for referral to arbitration or any other alternative dispute resolution mechanism.

Information from court. At filing counsel are given a handout describing the district's voluntary arbitration program. An ADR brochure is planned.

Plans. The court plans to implement mediation and ENE programs.

Evaluation. A Federal Judicial Center study of the first year of the court's voluntary arbitration program is reported in David Rauma & Carol Krafka, Voluntary Arbitration in Eight Federal District Courts: An Evaluation (Federal Judicial Center 1994). As one of the ten comparison districts established by the CJRA, the court is also included in the RAND study of the pilot and comparison districts, which will be reported to Congress by the Judicial Conference in 1996.

For more information

Alycia Wood, CJRA Analyst, 602-514-7067
June Honanie, Arbitration Clerk, 602-514-7102

IN DEPTH

Arbitration in Arizona

Overview

Description and authorization. The District of Arizona is one of the ten pilot districts designated by 28 U.S.C. งง 651-658 to provide voluntary, nonbinding court-annexed arbitration in cases involving monetary claims of $100,000 or less. It is one of four districts (see also W.D. Pa., M.D. Ga., N.D. Ohio) using an opt-out system. Under the program, which was established in 1992, cases are automatically referred to arbitration after answer is filed, but any party may take the case out of arbitration by filing a Notice of Withdrawal within 21 days of the referral. Arbitration hearings are held within 180 days of filing. A single arbitrator presides and is compensated by the court. The arbitration procedure is described in Local Rule 2.11, which also permits parties to consent to binding arbitration.

Number of cases. Between January and November 1994, 155 cases were referred to arbitration; 29 went into the arbitration process, and the others settled or opted out.

Case selection

Eligibility of cases. Eligible civil cases are those involving money damages only of $100,000 or less, exclusive of interest and costs. The court assumes damages are within this range unless the parties certify otherwise. Cases ineligible for arbitration include civil rights, tax refunds, ADEA, ERISA, Social Security, Title VII, class actions, cases pending on the multidistrict calendar, constitutional claims, prisoner pro se actions, actions seeking injunctive or equitable relief, actions against six or more defendants, and cases assigned to the expedited track under the district's local rule on differentiated case management.

Referral method. Eligible cases are automatically referred to arbitration when all defendants have filed answers or the time for filing answers has expired. If a dispositive motion is filed before the arbitration referral, arbitration proceedings are automatically stayed.

Opt-out or removal. Cases may be exempted from voluntary arbitration in several ways. Any party may opt out of the arbitration program by submitting a notice of withdrawal to the arbitration clerk within twenty-one days of the referral date. Parties may seek to withdraw at a later time for good cause by motion to the arbitrator. Additionally, the assigned judge may exempt a case from arbitration at any time if the matter involves a complex or novel legal issue, if legal issues predominate over factual issues, or for other good cause.

Scheduling

Referral. Cases are referred to arbitration when the answer is filed or the filing time has elapsed, and parties are notified by court order. If a dispositive motion is filed before the arbitration referral, arbitration proceedings are automatically stayed.

Discovery and motions. Discovery is permitted and must be completed within 120 days of the arbitration referral. The arbitrator handles all discovery motions and other case management matters arising after the arbitration referral.

Written submissions. At least ten days before the arbitration hearing, parties must submit to opposing counsel and the arbitrator prehearing statements, listing issues to be determined and all potential witnesses and exhibits. Prehearing briefs may also be filed.

Arbitration hearing. The arbitrator sets the location, time, and date of the hearing. The arbitration clerk advises the parties of the hearing, which must be held within 180 days of filing the answer. Arbitration hearings are usually conducted at the arbitrator's office.

Length of hearing. Hearings generally last no more than one day.

Program features

Party roles. In addition to counsel, parties or party representatives with settlement authority are required to attend the arbitration hearing. Sanctions are authorized under local rule for a party's failure to attend the hearing or to participate in the hearing in a meaningful manner.

Filing of award. The arbitration award and decision are filed with the arbitration clerk under seal. If a trial de novo is not requested, the award is entered as the final judgment. If a de novo request is filed, the award remains sealed, and the docket notes only the date the arbitration award was filed.

De novo request. Parties not satisfied with the arbitration award must file a request for trial de novo within thirty days of the filing of the award. When requesting a trial de novo, the moving party is required to deposit with the arbitration clerk a sum equal to the total fees paid or payable to the arbitrator. The sum is returned if the party obtains a final judgment more favorable than the arbitration award.

Confidentiality. Withdrawals from arbitration are confidential, and the identity of the party opting out does not appear on the docket. Awards are sealed unless accepted by the parties. The sealed arbitrator's award may not be considered by the court or jury before, during, or after the trial de novo.

Neutrals

Qualifications and training. To serve as an arbitrator, attorneys must have practiced law for at least five years, be admitted to the District of Arizona bar, and possess substantial experience in either litigation, neutral practice, or consensual problem solving in complex negotiations. Candidates must also specify their areas of expertise.

Selection for case. A single arbitrator is selected by either the parties or the court. The parties may select an arbitrator from the court's roster of attorneys and former judges, or they may identify an arbitrator from another source. If the parties fail to agree on an arbitrator, the arbitration clerk will select an arbitrator with the desired subject matter expertise from the court roster. Each side may reject one court-selected arbitrator, whereupon the arbitration clerk will select another arbitrator.

No specialized training of the arbitrators is required. The court notes: "This District is fortunate to be situated in a state where arbitration has been in place, with attorneys having considerable experience serving as neutrals in that court system. Several arbitrators are retired judges, now residing in Arizona."

Disqualification. The arbitrator is subject to the disqualification rules set forth in 28 U.S.C. ง 455 and may decline to serve for any reason.

Immunity. The court has not addressed this issue.

Fees. The court sets and pays arbitrators a fee of $250 for each case or each day of hearing, whichever is greater. Outside arbitrators selected by the parties are subject to the court's compensation structure.

Program administration

The arbitration program is administered by the clerk's office. Substantive or procedural problems are handled by an advisory committee chaired by a district judge and composed of three counsel, two district judges, and the court clerk.

Excerpted from ADR and Settlement in the Federal District Courts: A Sourcebook for Judges & Lawyers, 1996, a publication of the Federal Judicial Center and CPR Institute for Dispute Resolution