Judges as Mediators, and the Issues that Won’t Go Away

By Mnotho Ngcobo

If you were to ask a layman what mediation is, the answer would probably be something along the lines of, “a private dispute resolution process where an independent private mediator would attempt to assist parties to reach an agreement/solution to whatever dispute they may be facing.”

But one of the problems with the typical layman’s mediation view is that it doesn’t account for a continually emerging group of individuals working their way into this ADR process–the judicial officers, including judges and magistrates (and noting that different countries have different names for these officials).

Often, parties go to mediation to avoid facing a judicial officer. That’s arguably the best part about ADR . . . or it used to be. Judicial officers are employed to adjudicate disputes. They are trained to uphold law and rules, while private mediators are specialists trained to facilitate disputes–they aren’t primarily focused on procedure, for example, because mediation by its nature is flexible and not rule-based.

What happens when a judicial officer AKA a judge mediates a case? What issues does it raise for the parties in disputes?

The truth is that parties often fear judicial officers, and when a judicial officer is facilitating a mediation, parties might not be comfortable. There is then a risk that a party would agree to something out of fear: What happens when the same judicial officer who facilitated the mediation between the parties is tasked with running the fairness hearing? This could cause problems, and some might cry “judicial overreach.”

An interesting case where the judicial officer facilitated the mediation and was also tasked with running the settlement agreement’s fairness hearing was decided earlier this year in McAdams v. Robinson, 26 F.4th 149 (4th Cir. Feb. 10, 2022)(available at https://bit.ly/3aECNBO).

This case arises from a class action lawsuit against Coppell, Texas, finance company Nationstar Mortgage LLC, alleging that Nationstar was in breach of the state and federal consumer protection laws, failing to timely acknowledge receipt of class members’ loss mitigation applications, respond to the applications, and diligently obtain documents to process them.

The case was litigated over six years. In 2017, a Maryland-based U.S. District Court judge referred the case for “Settlement or other ADR conference” before Magistrate Judge Timothy J. Sullivan, of Greenbelt, Md. In March 2020, the parties were ordered to conduct mediation. In June 2020, the parties filed a notice of settlement and a joint motion to proceed before the magistrate judge who had mediated the settlement. Among other things agreed upon in the proposed settlement agreement was that Nationstar would pay a $3 million relief fund, consisting of:

  1. Administrative expenses up to $300,000;
  2. Attorneys’ fees;
  3. A service award to the class’s representative; and
  4. Class claims.

Any remainder, the Fourth Circuit opinion noted, would go to a nonprofit that advocates for consumers. In exchange for the settlement relief fund, all claims against Nationstar would be released.

The magistrate granted the preliminary approval of the settlement agreement and scheduled a fairness hearing.

Petitioner McAdams, who had filed suit against Nationstar in a California action, filed an objection to the proposed settlement agreement. She maintained that the class notice was insufficient; the settlement was unfair, unreasonable, and inadequate; the release was unconstitutionally overbroad, and the attorneys’ fee award was improper.

Objection Overruled

The magistrate judge who mediated the case overruled McAdam’s objections and held that the distribution of the notice was sufficient; the settlement terms were fair, reasonable, and adequate; and the release was not too broad. The magistrate also went on to approve the $1.3 million attorney’s fee.

On appeal, the Fourth U.S. Circuit Court of Appeals affirmed in a unanimous opinion by Circuit Judge Albert Diaz.

The appeals court did not deal in detail with the issue of the magistrate judge having a dual role, as both a mediator and the judge approving the settlement.

Yet petitioner McAdams attacked the magistrate judge’s jurisdiction, holding that she did not consent to have the magistrate judge hear her case. Federal law provides that with the “consent of the parties,” a magistrate judge may conduct “any or all proceedings . . . and order the entry of judgment.” 28 U.S.C. § 636©(1). McAdams argued that the word “parties” includes her as an absent class member.

But the appeals court rejected McAdams’s assertion and held that absent members are not ‘within the contemporary meaning of the term “parties” as used in § 636.

McAdams also argued that this case presents a serious conflict of interest because the magistrate judge both mediated and approved the settlement agreement. The panel noted that it did not deal with this issue because McAdams did not “support that assertion” nor “preserve [it] for appeal.” The opinion states that McAdams did not move for the magistrate judge’s recusal or otherwise object. For those reasons, the Court did not deal with the conflict issue.

The Fourth Circuit has addressed with the issue of objector requirement in 1988 Trust for Allen v. Banner Life Ins. Co., 28 F.4th 513 (4th Cir. 2022) (available at https://bit.ly/3o47kvZ). In the case the objector argued that there was no burden on its part to show that the settlement was unfair, but rather the burden rested on the parties that sought settlement approval. The appeals court rejected this argument and held that the objector must clearly state its case to allow the other parties to fully respond and for the court to evaluate the issues. The court held that it is only when a sufficiently specific objection has been made, that the parties seeking settlement approval have the burden of proof.

The objector, like McAdams, failed to support it arguments.

The McAdams case creates severe implications for the absent class members. It may seem like the courts afford them less protection. Class actions not only affect the rights of the named plaintiffs, but also the rights of the absent class members. The court must play a major role in ensuring that the rights of all class members are recognized and protected.

The McAdams appeals panel held that absent class members are not parties to the action within the meaning of section 636(c), and, therefore, absent class members do not need to consent should the named plaintiff and defendant file a consent.

Removing and/or limiting such a right should be accompanied by some form of protection. This means that McAdam’s conflict-of-interest argument plays little to no role in this case since she, and others in her position, cannot object nor consent as absent class members.

The Magistrate’s Dual Role

Presiding judicial officers have long been performing this dual role of mediating and approving settlements. Some scholars argue that this dual role improves access to justice–in that there is no need to hire a private mediator, thus reducing costs for the parties involved.

Others counter that the dual role creates a conflict of interest. A judicial officer who mediated a case might be biased once the official has to decide on the same matter at a fairness hearing.

One of the biggest and most persistent issues is that a judicial officer determined to settle a case “has enormous power to coerce a settlement.” Patrick E. Longan, “Bureaucratic Justice Meets ADR: The Emerging Role for Magistrates as Mediators,” 73 Neb. L. Rev. (1994) (available at https://bit.ly/3z8fPMQ). The court can instill in the parties a fear of retaliation which would make going to trial unappealing.

Lawyers representing their clients before the judicial officer serving as a mediator might feel compelled to urge clients to accept whatever the judicial mediator is saying to avoid alienating the court, or be on the wrong side of the judicial officer, which would make their future cases before that judicial officer hard.

So while it may seem like a good idea to have judicial officers serve as mediators, it still can create some problems. A judicial officer who mediates a case might have his or her objectivity questioned later because, during mediation, parties will disclose information and the mediator would weigh in on that and might even advise the parties of the cons of going to trial. The judicial officer runs the risk of being committed to one view of the case.  

The risks of judicial officers serving as mediators far outweigh the benefits. In McAdams, the argument of conflict of interest could have been avoided if a different judicial officer had decided on the fairness hearing. The moment the magistrate judge ran the fairness hearing, the conflict arguments advanced above were triggered.

As McAdams demonstrates, the area continues to be one of intrigue both for case management efficiency, and the problems inherent in its use.  See a new article on the topic at Melissa B. Jacoby, “Other Judges’ Cases” NYU Annual Survey of American Law, Vol. 72, 2022 Forthcoming, UNC Legal Studies Research Paper (June 30, 2022) (available at https://bit.ly/3cj2PuY).

For more on McAdams, see Donald L. Swanson, “Judicial Mediator Serving As Deciding Judge In Same Case: An Overreach? (McAdams v. Robinson)” mediatebankry blog (Feb. 22, 2022) (available at https://bit.ly/3aEY3HC).

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The author, a South Africa attorney who received his LLM in dispute resolution from University of Missouri-Columbia Law School in May, is a 2022 CPR Summer intern.

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Love’s New Mediation Data: Whither the Joint Session?

By Temitope Akande

New York Law School’s Alternative Dispute Resolution Skills Program kicked off its first 2021 round of biweekly Wednesday lunch conversations yesterday featuring mediator Lela Porter Love, a law professor and director of the Kukin Program for Conflict Resolution at New York’s Benjamin N. Cardozo School of Law.

Love opened by emphatically noting that dialogue is currently dying or impoverished, even on the political scene. Mediation, she said, “is the last bastion,” with mediators trained to promote dialogue. But even in mediation, there is “less and less mandate for mediators to bring parties together into joint sessions.”

Her discussion was mostly based on a 2019 survey of practicing mediators in a professional group, the International Academy of Mediators, to determine the use of joint and caucus sessions. Presenting a PowerPoint, “The Disappearing Joint Session,” based on 129 responses and anecdotal discussions, Love said that the data reflects the title: There is a lessening frequency of the use of joint sessions and more reliance on mediators conducting caucuses with individual parties.

Prof. Love moved to a 2017 survey by the American Bar Association Dispute Resolution Section Task Force on the Relation of Mediator Actions to Mediation Outcomes also on the use of caucus during mediation. The results, she said, were counterintuitive: caucusing had an increased settlement effect in labor-management disputes, but no effect, according to her presentation slide, “in other types of disputes regardless of [the] purpose of caucus (i.e., whether to establish trust or discuss settlement proposals).”

She said that the use of caucus has shown that parties are more likely to file an enforcement action based on their settlement—which indicates that increased caucusing didn’t reduce acrimony. As a result, caucus sessions, while they may increase labor-management case settlement, may have potential for negative effects on the parties’ perceptions and relationships.

Love discussed the caucusing results in a broad Maryland state judiciary ADR evaluation report. Based on the evaluation of caucus sessions, the greater the percentage of time participants spent in caucus, the less likely the parties were satisfied with the outcome, and the less likely the participants report that the issues “were resolved with a fair and implementable outcome.”

“On balance,” said Love, “you don’t see this real, ‘Wow, now I understand why there is this great move to caucusing.’”

The Maryland study showed that when the mediators controlled the sessions, limiting the issues instead of presenting a broad range, parties showed an increase in a desire to better understand the other party. The long-term aftereffects results show that the greater percentage of time participants spent in caucus, the more likely participants will return to court for an enforcement action after mediation, reflecting a lack of durability of those mediation results.

Love further discussed the values that influence mediation style and reasons why mediators use caucus sessions instead of joint sessions, returning to the IAM study. First, mediators who do not use joint sessions primarily do not do so because attorneys do not want joint sessions.

The second reason they lean toward caucus and away from joint sessions is that parties tend to decline joint sessions because they feel more comfortable participating in the mediation process by sharing their stories in caucus sessions with the mediator, rather than facing their adversary. “People in conflict are really angry at each other and they don’t want to see each other,” explained Love.

Love further noted that mediators were mostly trained to use joint sessions, though different schools of mediation also favored caucuses. A more important factor in constructing and conducting mediation sessions is that a significant purpose is to get people together to heal relationships—as opposed to the “war” of adjudication–which orients toward using joint sessions.

Prof. Love concluded by stressing that listening helps settle cases, and it is important in helping people tell their stories. The mediators who seek to identify the parties’ interests perhaps are doing only one aspect of the process, noted NYLS ADR Skills Program Director and moderator F. Peter Phillips, who added that mediation might be better handled if the emphasis was on all parties listening and working to understand one another. Love concurred, and, noting that mediators are witnesses to the participants’ stories, suggested that neutrals provide “respectful-person listening” that enhances the process.

Love’s Jan. 13 NYLS Conversations in Conflict Resolution session is available on YouTube at https://bit.ly/3nOluyK.

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The author, who received a Master of Laws in Alternative Dispute Resolution last May at the University of Southern California Gould School of Law in Los Angeles, is volunteering with the CPR Institute through Spring 2021.

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