The Commercial Division Advisory Council has proposed that the court adopt a pilot program for New York County’s Commercial Division that would send every fifth newly assigned case to mediation unless the parties stipulate otherwise or one party makes a good cause showing that mediation would be ineffective or unjust.  A copy of the proposal is available here.

The pilot program is described as “fairly conservative” and flexible in the December 11, 2013 proposal.  The program is purportedly conservative because it only mandates that one of every five cases be sent to mediation.  If adopted, the program allegedly will be flexible because it (a) allows the parties to opt-out or attempt to do so and (b) would permit the parties to select their own mediator (or request one from the neutrals roster).  The proposal would, however, require completion of mediation within 180 days from the assignment of the case to a Commercial Division Justice.

The pilot program, recommended by the Commercial Division Advisory Council, is designed to streamline dispute resolution in New York’s “heavily burdened” commercial courts.  The goal is to produce more settlements and alleviate some of the buildup in the Commercial Division dockets by sending cases to mandatory mediation, allowing those judges to focus more on “substantive legal and factual issues and the development of New York commercial and business law.”  According to the Task Force report underlying the Advisory Council’s recommendation, mediation is an under-utilized tool in the Commercial Division.  Parties may be reluctant to suggest mediation due to a desire to project confidence and a fear of sending the wrong signal to other side.  This program is aimed to overcome those concerns and make mediation a more popular and prevalent choice.  The Advisory Council hopes to maintain and even enhance the competitive stature of the New York Commercial Division in the U.S. and abroad in light of the growing popularity of alternative dispute resolution.

The mandatory program, as proposed, will include an eighteen-month sunset provision in order to assess the need for expansion, modification, or even cancellation