ADR, Alternative Dispute Resolution, has continued to grow in all sectors of our society, including government. In my home state of Oregon, the Legislature has actively promoted greater use of ADR in the public sector, first with the establishment in 1987 of the Oregon Dispute Resolution Commission, and later with the public policy statement embodied in ORS 183.502, part of the Oregon Administrative Procedures Act (APA). Oregon has emerged as a leader in the effective promotion of ADR within its borders. However, the focus of that development has been court-annexed and court-mandated programs, community and neighborhood dispute resolution programs and public policy dispute resolution. Ironically, there have been very few ADR programs in the contested case context.
Oregon’s experience has not been atypical. While most states have gotten on the ADR bandwagon with some type of government-sanctioned program, there has been considerable resistance to the notion that there is a place for ADR in the contested case realm; and, where ADR has been accepted, agencies more often opt for direct negotiation with the person or entity subject to the agency’s proposed sanction or adverse action, rather than participating in facilitated negotiations using a third-party neutral, or mediator. This is perhaps natural, given that the government agency negotiates from a position of power, and mediation is generally intended to balance out the power between the disputing parties.
An exception in the administrative arena can be found when the agency serves as the “forum” for adjudicating disputes between two (or more) other parties. In Oregon, highly successful and effective programs have developed at the Workers’ Compensation Board and at the Construction Contractors Board/Landscape Contractors Board. Both of these “forum” agencies are charged with adjudicating claims, in a setting not unlike the judicial trial.
The Workers’ Compensation Board actively promotes mediation in lieu of the hearing process. Formal mediation is conducted by Administrative Law Judges (ALJs) who have been trained as mediators, and most mediations result in settlement. As noted in its information brochure provided to the parties, “Mediation saves time and expense, removes uncertainty, and allows the parties to create a resolution of their case that they feel is in their best interest.” Mediation is completely voluntary, and if the case doesn’t settle at the mediation, it is simply put back on the docket and assigned to a different ALJ, who has no contact about the case with the mediator-ALJ. Due to demand, the Board’s mediation program has become an integral part of its overall mission of deciding disputed claims. Similarly, the Oregon Construction Contractors Board has, for a number of years, promoted settlement of claims against contractors for alleged improper or negligent work or breach of contract. With the creation of Oregon’s new Hearing Officer Panel, CCB has delegated broad authority to qualified Panel ALJs to assist parties in reaching an informal compromise settlement in any CCB claim case referred for a contested case or an arbitration hearing. ALJs are trained to effectively conduct settlement conferences in which they facilitate settlement negotiations between the parties.
Such conferences are scheduled in lieu of a hearing and may be conducted by phone, if all parties involved agree to participate, or a settlement conference may be convened at the time otherwise set for the hearing (i.e., at the courthouse steps), if the parties so choose. In either case, an ALJ who conducts a settlement conference will not participate in the case any further if the case doesn’t settle. In such cases, the matter is put back on the docket for hearing with a different ALJ. However, ALJ-facilitated negotiations have resulted in settlement over 90 percent of the time (as opposed to just over 40 percent when the parties opt to negotiate with each other directly). Approximately 300 cases, some involving multiple parties (homeowner, general contractor, subcontractors and suppliers) have been settled without hearing since July 1997.
An agency’s interest in maintaining its power advantage is not the only reason that facilitated settlement of traditional contested cases (where an agency proposes an action adverse to a citizen party, i.e., civil penalty for some violation, suspension or revocation of a license, etc.) has been slow to develop. It is very difficult (though not impossible) for “in-house” agency ALJs to credibly present themselves as third party neutrals for the purpose of facilitating settlement discussions; and where else can an agency and the affected party find a mediator with at least some subject matter expertise, without incurring considerable extra expense?
The answer has come as perhaps a by-product of the movement of a growing number of states to adopt some form of a centralized office of hearings. The compelling force driving that movement has been the concern to assure fairness in the adjudicatory process by separating the ALJs from the agency proposing an adverse action, and by assuring the independence of the ALJ who hears and decides the case. By having institutionally created that separation, the centralized hearing offices in the several states have also become the most natural source of third-party neutrals able to facilitate/mediate contested cases, obviating the need for, and expense of, a contested case hearing and the administrative and potential judicial review of the result.
In any case, many issues arise (and certainly should arise) with agency compromise of enforcement mandates, and even discretionary sanctions. However, many states, particularly those with a centralized office of administrative hearings, have been exploring and developing just such facilitated settlement programs, and most utilize ALJs as mediators. Some examples of programs involving the use of ALJs as mediators follow.
The Minnesota Office of Administrative Hearings has provided ALJ mediator services for over fifteen years. These mediations have included professional licensing disciplinary cases as well as court-referred mediation, and even some larger public policy disputes. The Georgia Office of State Administrative Hearings has developed a formal ADR program, on a voluntary basis, for the resolution of contested cases otherwise bound for an administrative hearing. Maine’s Division of Administrative Hearings provides dispute resolution services to state agencies.
The Texas Office of Administrative Hearings has developed a sophisticated settlement program, as a result of legislation in 1997 authorizing ALJs to refer cases to ADR procedures. Under that law, ALJs are authorized to serve as impartial third-party facilitators, but parties may opt for private mediation at their own expense. The most commonly used form of ADR is the “Mediated Settlement Conference” conducted by an ALJ who has no previous or subsequent responsibilities in the case. Since its inception in 1997, that program and the number and types of cases mediated has gradually but steadily grown to include such cases as professional licensing disciplinary actions, medical necessity of a particular medical treatment, sanction for sale of alcohol to minors, and others.
In Colorado, the Division of Administrative Hearings began developing a mediation program in 1993, coordinated by ALJ Marshall Snider, who was the Chief ALJ. The primary users of the service over the past five years have been the state licensing boards, though the program has expanded to other agencies and the number of cases referred for mediation has steadily increased. ALJ Snider and Colorado hosted the “Mediation for ALJs” program, co-sponsored by NAALJ, NCALJ and the ABA Section of Dispute Resolution, April 2-6 2000 in Denver.
In North Carolina, the Chief ALJ of the Office of Administrative Hearings has statutory authority to order a mediated settlement conference in any case. However, the mediated settlement conference is conducted by a private mediator, properly “certified” through the Administrative Office of the Courts, rather than by an ALJ. The parties may select a mutually acceptable mediator or, if agreement between the parties cannot be reached, the Chief ALJ may appoint a mediator to the case. Since 1994, over 650 cases have been referred for mediation.
Finally, the Maryland Office of Administrative Hearings has provided ALJ mediation of special education cases for some time, but has only sporadic requests for mediation in other case types. In an effort to prepare for increased utilization of ADR in lieu of contested case hearings, the entire corps of ALJs recently completed 40 hours of mediation training.
Not all mediation services by ALJs are generated by central hearing agencies, however. In Missouri, the Office of Hearings does not provide any mediation services but, like Oregon, the Division of Workers’ Compensation hearings program has incorporated mediation by ALJs and associate ALJs into its case adjudication system, on a case-by-case basis. In New York, the Department of Environmental Conservation Hearings program has become the Hearings & Mediation Program, and has provided ALJ-conducted mediation services since 1996. Pennsylvania’s Public Utility Commission Office of Administrative Law Judge employs a mediation coordinator and offers all parties opportunity to mediate disputes with the assistance of an ALJ as mediator. ALJs at the Washington State Department of Health, Office of Professional Standards provide mediation services in licensee disciplinary cases, and also mediate workplace disputes within the agency; and the Washington Growth Management Hearings Board, which is divided into four regions, offers mediation of land use planning disputes, provided by a Board member from another geographic area.
These examples are not exhaustive, but do provide a glimpse at how ALJs are already functioning effectively as mediators, to the benefit of the parties and agencies involved. Such examples should help to dispel the “myth” that settlement (with or without mediation) of enforcement type contested cases is not possible or appropriate. Similarly, these examples serve to reinforce a conclusion that the view, held by many, that ALJs should stick to judging and not venture into the mediation field is not well founded.
ALJs are uniquely qualified to serve as third party neutrals in facilitating resolution of contested cases, including enforcement cases initiated by state agencies. As pointed out by Daniel Louis, Chief ALJ at the New York Department of Environmental Conservation, regarding the use of ALJs as mediators in his agency, “The combination of having familiarity with a wide range of DEC programs, their training as ALJs and mediators, make them logical choices for dispute resolution.” In too many states, including my own, ALJs represent a resource for cost-effective ADR services that is not being fully utilized.
It is time to work toward removing the barriers to the increased use of ADR in the contested case arena, and to recognize the clearly valuable role for ALJs in facilitating resolutions to contested cases. It is time to open up a dialogue regarding the ADR services that ALJs can and should perform to better serve the citizens contesting agency actions and to minimize the cost to state agencies of effectively fulfilling their missions. Your comments, responses, anecdotes are all encouraged and may be sent to firstname.lastname@example.org.