On Professional Practice: New Rules in Minnesota

“On Professional Practice” examines how professional responsibility principles apply to our work. Sharon Press, a member of the Dispute Resolution Magazine editorial board, serves as the “On Professional Practice” editor. We encourage readers to submit ideas for future columns to her at [email protected].

After years of work, the Minnesota Supreme Court adopted new court rules for Minnesota’s ADR program that went into effect on January 1, 2023. Since many jurisdictions have rules, and some may even have updated those rules to meet the reality of remote ADR processes, why spend time looking at the Minnesota revisions? First, I live in Minnesota and thus have a personal interest in them. But more importantly, the Minnesota rule revisions may be worth exploring nationally. I had some limited involvement in drafting these rules, but for the most part, they were adopted despite some major concerns I raised.

Minnesota first adopted court rules for ADR effective July 1,1994. So it was not among the first states to adopt ADR rules, but was ahead of many. Minnesota has a fairly sophisticated system of state statutes, court rules, and ethical standards, and has a grievance body. But it primarily relies on volunteers for managing the system. Unlike Florida, which has a well-staffed Dispute Resolution Center to assist the various Florida Supreme Court ADR committees and boards, Minnesota has an ADR Ethics Board charged with reviewing grievances filed against ADR neutrals. The Ethics Board is also responsible for developing proposed rule revisions with minimal staff assistance.

By way of context, one major feature of the Minnesota court ADR rules is that both the procedural rules and the ethical standards cover the full continuum of ADR processes. Specifically named and defined are “adjudicative processes” (arbitration, consensual special magistrate, and summary jury trial); “evaluative processes” (early neutral evaluation (ENE), non-binding advisory opinion, and neutral fact finding); “facilitative processes” (mediation); and “hybrid processes” (mini-trial, mediation-arbitration (med-arb), arbitration-mediation (arb-med)); and “other.” In the definition portion of the rule, “other” includes the following sentence: “Parties may create other ADR processes by means of a written agreement that defines the role of the neutral.” This means that unlike other jurisdictions that focus on mediation (and sometimes arbitration), Minnesota offers a wide variety of ADR processes—although mediation is used most often.

The amendments can best be understood in this context. Most of the proposed revisions arose from issues the ADR Ethics Board had grappled with since the last revisions. Although mediation is the process most often used, the vast majority of grievances filed by participants that come to the attention of the ADR Ethics Board relate to “family” issues and, more specifically, the hybrid processes—not mediation. Since the ADR Ethics Board had recommended these changes, the amendments focused on addressing these concerns.

This requirement for a “written agreement” is one of the interesting revisions. Prior to these revisions, the Civil Mediation Act (Minnesota Statute § § 572.31 - 40) required participants in civil cases to sign an agreement to mediate if they intended their mediated agreement to be binding. Such an agreement was not required for any of the other ADR processes described above. From the ADR Ethics Board perspective, requiring a signed agreement to participate in an ADR process would go a long way to address concerns most often raised in grievances. A signed agreement would also ensure that participants understood what process they would engage in. As you might imagine, if someone thought they were engaged in a facilitative process and the neutral started making decisions or offering opinions, they would be disconcerted.

Thus, the “new” ethical standards contain a provision entitled “Requirement of Written Agreement for ADR Services” (Rule 114.13 subd. 7(b)).  Under this Rule

In any civil or family court matter in which ADR is used, the Neutral shall enter into a signed written agreement for services with the parties either before or promptly after the commencement of the ADR process. The written agreement shall be consistent with any court order appointing the Neutral… The written agreement shall include, at a minimum, the following:

1. A description of the role of the Neutral.
2. If the Neutral’s role includes decision making, whether the Neutral’s decision is binding or non-binding.
3. An explanation of confidentiality and admissibility of evidence.
4. If the Neutral is to be paid, the amount of compensation, how the compensation will be paid, and include a notice that the Neutral could seek remedies from the court for non-payment…
5. If adjudicative, the rules of the process.
6. That the Neutral must follow the Code of Ethics for Court-Annexed ADR Neutrals and is subject to the jurisdiction of the ADR Ethics Board.
7. Neutrals for facilitative and evaluative processes shall include the following language in the agreement signed at the commencement of the process:
   1. the Neutral has no duty to protect the interests of the parties or provide them with the information about their legal rights;
   2. no agreement reached in this process is binding unless it is put in writing, states that it is binding, and is signed by the parties (and their legal counsel, if they are represented) or put on the record and acknowledged under oath by the parties;
   3. signing a settlement agreement may adversely affect the parties’ legal rights;
   4. the parties should consult an attorney before signing a settlement agreement if they are uncertain of their rights, and
   5. in a family court matter, the agreement is subject to the approval of the court.

In essence, the Rule takes the statutory requirement related to civil mediation, expands it to cover all ADR processes, and elevates it to an ethical standard.

Pros and Cons

From my perspective, providing clear information to participants before they engage in ADR processes is clearly a positive. Even those of us who are active in the ADR field may have difficulty defining all the different ADR processes or reaching a consensus on the “correct” definition of each. As practitioners continue to offer a range of services that run the gamut from adjudicative to evaluative to facilitative or some combination thereof, it makes sense to require clear communication, in writing, to potential participants in these processes.

Second, this new rule requires “neutrals” to disclose up front that they are subject to a set of ethical standards and to identify the enforcement body, an important contribution. Practitioners responsible for grievance processes have long speculated that so few grievances are filed against mediators primarily because most participants are unaware that a code of conduct governs mediators, never mind what it contains or where they would file a complaint. Left to their own devices, most neutrals do not provide this information orally or in writing.

A few words about section seven of the new Rules. Minnesota is one of the few jurisdictions that has the so-called statutory “magic language”—language required in a mediated agreement to make the agreement binding. Absent such a requirement, mediation agreements are generally treated like any other contract that involves the meeting of the minds and therefore could be enforced. In Minnesota, the same statute requiring an “agreement to mediate” in civil cases also contains a provision stating that

A mediated settlement agreement is not binding unless:

1) it contains a provision stating that it is binding and a provision stating substantially that the parties were advised in writing that a) the mediator has no duty to protect their interests or provide them with information about their legal rights; b) signing a mediated a settlement agreement may adversely affect their legal rights; and c) they should consult an attorney before signing a mediated settlement agreement if they are uncertain of their rights.

Providing this information to the participants before a process begins, as required by section 7 of the new ethical rules, could mean they have helpful information they should know upfront. On the other hand, changing this provision from a limited application in the Civil Mediation Act to an ethical standard that applies to “all mediated settlement agreements” results in a problematic net effect. On its face, this is a very legalistic provision, and one that would likely cause unrepresented individuals to question their participation in mediation, especially when the mediator would be unable to help them understand what the provision means.

Wearing my hat as copresident of Community Mediation Minnesota, I am very concerned that this provision will have a chilling effect on community dispute resolution programs. Often, the participants in community disputes want to reach resolutions with their neighbors, family members, or coworkers—not the types of resolutions that a court would enforce (e.g., participants agree to treat each other with respect going forward). Including the language in the agreement to mediate and in the mediated agreement could be both confusing and not appropriate. But because this is an ethical rule, the community programs will be required to make it a regular part of their process.

These changes are a good reminder that those responsible for developing revisions should use an inclusive process when drafting rule amendments. Revisions should be considered from many different perspectives to limit the unintended consequences of provisions that may be helpful in one context, but detrimental in another.