What was initially a two-year pilot program to send lower-value Law Division cases through mandatory arbitration has now become permanent practice in Cook County Circuit Court.
Effective Oct. 1, the Illinois Supreme Court has approved and made permanent the Law Division’s Commercial Litigation Arbitration Program.
Aimed at cases involving breach of contract, employment disputes and other commercial matters, the program mandates that cases be sent to an arbitrator if their damages are alleged at no more than $75,000 — a relatively low number in a division that oftentimes handles cases that involve six- and seven-figure damage awards.
Under the program, parties are assigned an arbitration date for four months after a defendant files its answer to a lawsuit.
But in those four months leading up to an arbitration — conducted at the Cook County Mandatory Arbitration Center on the 13th floor of 222 N. LaSalle St. before a single arbitrator — parties remain in court conducting discovery and negotiating or even entering into settlement agreements.
Circuit Judge Thomas R. Mulroy Jr., who oversees the program, said the procedure has served those cases well because “it’s hard to get everybody’s attention in a small case.”
“In a big case, a million-dollar case, you’re constantly taking depositions and plotting strategy,” he said. “In a smaller case, it’s harder to bring it to the front of the file drawer. This does that because you’ll be going in front of an arbitrator, and everybody has to think about it.”
Although four months elapse between the date a judge will set an arbitration and the date parties appear before an arbitrator, Mulroy said the process amounts to about a month that they are exchanging information and preparing for the arbitration.
That month does not delay the case in court, he said, because the time spent conducting discovery directly prepares the parties to present their evidence to a neutral party who can decide their case on its merits.
“That’s the key — it can’t be something that delays everything,” he said. “Otherwise, what are you doing?”
The arbitrations happen in a less formal setting than a courtroom, which arbitrator and Taft, Stettinius & Hollister LLP partner J. Timothy Eaton said can benefit both litigants and attorneys because it makes the process less intimidating.
“You have the opportunity to have both sides heard without other people waiting in the courtroom to be heard,” he said. “It just is a very good environment for the lawyers and the clients to tell their story.”
But both organizers and participants say the program serves more than just court-process efficiency. They agree that it’s also a cost-effective initiative in increasing access to justice.
“People don’t have the resources to spend years in litigation on relatively small amounts of money … where the cost benefit of engaging in years of litigation doesn’t work out for them,” said Jonathan B. Amarilio, an associate at Taft, Stettinius & Hollister who has helped Mulroy promote and deliver Continuing Legal Education courses on the program.
“The program offers an efficient but fair opportunity for people to litigate their disputes quickly and get an answer to those disputes very quickly.”
The arbitrator issues an award on a case no more than two days after a hearing. If both parties agree with the arbitrator’s finding, the case is over.
The award, however, is not binding. A party can pay $750 to reject the award and return to court to continue litigating, negotiating or take a case all the way to trial.
But if the rejecting party receives an award at trial that is less than the arbitrator’s award, that party becomes responsible for footing the other side’s lawyer’s fees as they relate to the arbitration process.
Having that option puts the ball in the client’s court — which is a good thing when a lawyer’s starting point on a case is to focus on his or her client’s best interest, said Nicholas D. Standiford, an associate at Schain, Banks, Kenny & Schwartz Ltd. who has represented clients in arbitrations and also helped deliver CLE courses on the program.
“Any time you let the client make the decision and act in their own best interest, I think that’s a good thing,” he said. “As many options as possible for them is better.”
The court’s program is also an acknowledgement that many of the cases that go through the arbitration will settle anyway, Chief Circuit Judge Timothy C. Evans said.
“A settlement earlier rather than later helps the litigants and the lawyers,” he said. “But it also frees up the judicial aspect of this so that the judges can spend their time basically on cases that cannot settle. It’s a far more efficient way of moving these cases along through the system.”
And with the Supreme Court’s green light, Evans said, he is looking forward to sharing the program’s benefits and achievements with downstate judiciary members who might also want to establish a similar program in their jurisdictions — no matter their difference in population or resources.
“It’s not just Cook County saying the system works well; now they see the Supreme Court agrees with me,” he said. “Some of our success we’ve had here cannot be duplicated in other counties, but this one can be.”