Every day, we confront obstacles presented by the COVID-19 pandemic and the challenges those obstacles create. Among those obstacles are unfulfilled contracts, payment obligations that are hard to meet, and health hazards we strive to avoid. And among the challenges are the resulting legal obligations, liabilities, and damage, and how we hope to avoid or resolve those them.

How do businesses comply with duties owed employees and assure those important relationships remain strong? See Marc Engel’s fine advice in “Planning for the ‘New Normal’: 19 Effective Measures that Employers Should Consider in Light of COVID-19.” How do businesses deal with their leases, contracts with suppliers, and insurance agreements, and are they confident they have taken appropriate steps to protect persons who enter their premises? See Bill Goldberg’s insights in “COVID-19 Litigation – What Business and Their Advisors Need to Know.”

Relying on traditional litigation to resolve any ensuing disputes and claims might not be the best way to proceed given the chaos the pandemic has created.

State of the Courts

Just like businesses, courts have been interrupted by the pandemic, and judicial functions have ground to a virtual halt.

Through a series of Administrative Orders issued by the Chief Judge of Maryland’s Court of Appeals, all Maryland courts and judicial offices are “restricted to emergency operations . . . and closed to the public with limited exceptions, through June 5, 2020.” Maryland’s federal district court has employed similar restrictions. Filing deadlines, including statutes of limitations, have been relaxed, suspended, or tolled. Essentially, state and federal courts in Maryland are closed, with very limited exceptions for truly emergency matters.

While Maryland’s state courts are at the moment closed “only” through June 5, it is widely feared that courts will not open then, and may be closed well into or through the fall. And when they do re-open, there will be reams of paper to process and a logjam of matters to be addressed, including scores of criminal jury trials. Civil litigants with business-related cases will be facing months, and more likely years, of delay in having their cases processed, adjudicated, heard, and resolved.

Alternate Dispute Resolution

Given that reality, private parties should give serious consideration to pursuing alternative dispute resolution (ADR), including both mediation and arbitration. Mediation is the process where a third-party neutral mediator helps the parties explore ways to settle their dispute and hopefully reach a voluntary settlement. Mediation is particularly appropriate where the parties are engaged in an ongoing business relationship, e.g. landlord/tenant, supplier/customer, and wish not only to resolve their present issues, but also would like to preserve that relationship.

Mediation also gives the parties the freedom and flexibility to shape their own settlement, which is always a valuable feature for businesses. Arbitration involves a third-party arbitrator, or panel of arbitrators, who hears and decides the case. The parties may decide on what procedures to follow and can agree on scheduling issues. There are also hybrid forms of ADR that can adopt features of both mediation and arbitration. For example, parties may decide to pursue “med-arb,” in which mediation is tried, and if the parties cannot reach an agreement to settle their case, they proceed directly to arbitration, where the arbitrator or arbitrators will issue a decision.

There are features of ADR that parties frequently find attractive, e.g., the flexibility and potentially significant cost savings. Given the situation facing courts, however, those features of ADR become even more attractive. Choosing mediation, arbitration, or both seems a much better way to proceed than waiting for courts to clear the way for traditional litigation to move forward. Moreover, innovative use of remote technology can allow those processes to move forward now, while still respecting the need for social distancing.

We all have quickly become more experienced in the use of remote video technology to conduct meetings and conferences. So have mediators, and arbitrators are likely not far behind. In short, the same remote technology used to hold meetings can be used to hold mediation or arbitration sessions. Therefore, if a matter needs prompt attention, careful thought should be given to exploring mediation or arbitration, using remote technology.

Lerch Early’s lawyers are very experienced at representing parties in all forms of ADR, and lawyers at the firm have served as mediators and arbitrators. We are happy to talk with you and answer any questions you may have about using ADR to resolve your disputes during these uncertain times.