During a divorce in New Jersey, it is mandatory to attend court-appointed Economic Mediation. From this attorney’s perspective, Economic Mediation, which is actually mandated by way of a Court Order during which both lawyers choose an agreed upon mediator. The mediator is actually an experienced divorce attorney here in New Jersey who has been approved by each county’s Assignment Judge’s Family Lawyers Committee.
All told it is essential to be respectful to your mediator. Recently, a decision came down from New Jersey’s Appellate Division that demonstrates exactly what not to do to your mediator during your divorce.
In Oberman v. Oberman, husband Lawrence Oberman appealed from parts of an August 31, 2012 order of the Family Part. The order compelled him to pay one-half of the mediator’s fee, dismissed his un-filed allegations for damages of negligence, breach of contract, fraud and statutory breach arising out of a mediation against the mediator and others, denied his request to preserve the same allegations for future litigation, and awarded his ex-wife, Alice Oberman, additional counsel fees. Conversely, the mediator appealed from the trial court’s denial of her request for counsel fees for the work she did in opposing Lawrence’s motion and seeking payment of the counsel fees.
Lawrence and Alice were married in 1991. Alice filed for divorce on February 8, 2010. On May 5, 2011, the trial court ordered both of them to participate in mediation, pursuant to Rule 1:4p-5(b). Counsel for both Lawrence and Alice agreed on the mediator. After four mediation sessions, the parties were unable to reach a settlement. Subsequently, trial began in November 2011 and continued on and off until February 2012. The trial court entered a judgment of divorce on March 26, 2012. Although the trial court resolved many issues related to the distribution of marital assets and alimony in its decision, it still deferred decision on the issues of counsel fees, and allocation of outstanding expert and mediation fees until after the parties had submitted certifications.
Accordingly, Alice filed a certification requesting that Lawrence pay a large portion of the counsel and mediation fees. To support her certification, Alice argued that Lawrence was in a better financial position to pay these fees and also accused him of engaging in bad faith conduct during both the mediation and the trial. Lawrence responded by filing a motion on June 12, 2012, which set forth his belief that he had numerous claims against a variety of non-parties. He argued that he should pay nothing on the mediator’s bill, and that Alice should pay the entire amount. Alternatively, he asked that all claims he had against the mediator, her law firm, and Alice’s law firm for damages be preserved, and that he be permitted to proceed with a separate legal action. As another choice he asked that the allocation of the mediator’s fee be held pending the outcome of the separate litigation against the mediator and the other parties. He alternatively asked for extensive discovery on the alleged statutory violation, pursuant to the Uniform Mediation Act, New Jersey Statute 2A-23C-1 to -13, as well as on any claims that exist in law or in equity. This would include depositions of many people, and a plenary hearing in front of the trial judge with the fee allocation being held off until the completion of the discovery and the hearing.
Both Alice and the mediator filed cross motions. Alice opposed Lawrence’s request that his asserted claims to be preserved for future litigation, and denied that he had any cause of action against third parties as there was no conflict of interest. In the mediator’s cross motion she argued that even though she was not required to disclose the relationship between the partners, she disclosed this information anyway to Lawrence’s counsel, probably at the first mediation session. The mediator claimed that it was likely that Lawrence was present at the time the disclosure to his counsel was made. Additionally, the mediator included a certification from Lawrence’s former attorney stating that the he was “probably present” when the relationship between the partner at the mediator’s firm and the partner at Alice’s firm was discussed. Moreover, the mediator included a certification from a partner at her law firm explaining that the mediator would not financially benefit from the relationship. Furthermore, the mediator maintained that her efforts during the mediation assisted the parties to come to two preliminary agreements. Finally, the mediator sought payment for her fees and for counsel fees to cover her legal work in collecting the outstanding mediation fees.
On August 31, 2012, the trial court heard oral argument and issued an order and written decision. The trial judge denied every provision in Lawrence’s motion. The Family Part viewed Alice and the mediator’s cross motions as motions to dismiss Lawrences’s tort, contractual, and statutory claims under Rule 4:6-2(e), for failure to state a claim upon which relief can be granted. Still, because the trial court determined that the same matters were beyond the current pleadings, it decided to review the motion to determine if Lawrence had stated a cause of action. Applying the Rule 4:6-2(e) standard the trial court presumed that the mediator had not disclosed the relationship between the two partners. Still, Lawrence’s claims failed because he had not stated a cause of action under New Jersey Statute 2A:23C-9. He had not made any allegations that the mediator had a relationship with any party to the mediation or that she had a personal interest in the outcome of the same mediation.
After applying the standards enumerated in Rule 4:42-9 and Rule 5:3-5(c), the trial court concluded that Lawrence must pay $ 15,000 for Alice’s legal fees on top of the amount he had already paid. In regards to the mediation fees, both parties were ordered to split it equally. However the trial court denied the mediator’s request for counsel fees for her work in collecting the mediation fees, stating that attorneys who represent themselves are not allowed to collect counsel fees for that self-representation.
On appeal, Lawrence argued that the trial court incorrectly dismissed the claims against the third parties, in denying his request to preserve his non-filed claims, in ordering him to pay half the mediator’s fees, and in awarding any counsel fees to Alice without a plenary hearing. The Appellate Division started its review by stating that according to their standard of review a family court’s factual findings are given deference because of its special jurisdiction and expertise in family matters. However, a trial judge’s conclusions of law are not entitled to any special deference.
Mediation is governed by court rules 1:40-1 to -12, the Mediation Act, New Jersey Statute 2A:23C-1 to -12, and the New Jersey rules of evidence, N.J.R.E. 519. Our court system encourages mediation as an important means to settle disputes because of the growing body of evidence that mediation is especially successful at facilitating settlement. Regardless, some people may not find that process satisfactory and retain the right to resort to civil litigation to address wrongs. Lawrence contended that the trial court should not have dismissed his claims against the mediator and other third parties. According to the Appellate Division, Lawrence’s position showed a fundamental misunderstanding of the law. He never needed the court’s permission to preserve the claims against third-parties. Not once during litigation did he try to amend the complaint to add the non-parties. Instead, he requested that the claims be preserved. Because the claims were not made part of any formal pleading, the Appellate Division was required to reverse the trial court’s conclusion that Lawrence did not state a cause of action, because simply there was no complaint before the court to dismiss.
Next the appellate panel found Lawrence’s arugement that the mediator was not allowed to petition the court for her fees because the proper venue would be the Special Civil Court as unpersuasive. Even though the Guidelines for the Compensation of Mediators states that that when a mediator’s bills is unpaid, “he or she may bring an action in the Special Civil Part” that does not mean that the Special Civil Part is the only avenue for relief. Thus, the Appellate Division rejected Lawrence’s argument. Lawrence also argued that the trial court incorrectly applied Rule 5:3-5(c) in awarding counsel fees to Alice. He maintained that the trial court failed to consider alimony payments in calculating her ability to pay, and that the reward was arbitrary and based on the fact that he violated certain court rules. Finally he argued that the court failed to conduct a plenary hearing. The Appellate Division disagreed.
The decision to award counsel fees in a family law matter lies within the discretion of the trial judge. This decision will rarely be disturbed, and then only for a clear abuse of discretion. In the instant case, Lawrence’s argument was completely without merit. The appellate panel found the trial court’s decision to award counsel fees to Alice was an appropriate and reasonable exercise of discretion. The evidentiary record demonstrated that the court thoroughly analyzed and explained its reasoning. Thus, the Appellate Division refused to change the trial court’s counsel fee award. The trial court was also well within its authority when it refused a plenary hearing and declined the mediator’s request for counsel fees.
To learn more about the Economic Mediation process in a divorce here in New Jersey, please contact my office today.