Tuesday, April 28, 2015

Annual Meeting Highlight: In Case You Missed It

As I mentioned in my previous post regarding the Annual Meeting, we were privileged to have civil rights leader Fred Gray speak to us.  His message was powerful -- and it will remain powerful for years to come in light of our continuing discussions on race and diversity in America.

Not everyone can make the annual meetings, though.  In most cases, missing the meeting means missing the message.  But, with Mr. Gray's speech, the Forum and the American Bar Association believes that the message should be accessible to all -- even those persons who could not attend the meeting.

So, if you missed Mr. Gray's speech and would like to see it, or, if you would like to watch it again, please go to vod.videostreamz.net and use the login credentials - login: BocaResort (case sensitive) and password: ABAFCL (case sensitive).

This is an opportunity to hear directly from someone who witnessed and made history. Take advantage of it.

Monday, April 27, 2015

Litigation Tips: 4 Things to Never Forget

1. People lie. Don't expect your opponent to tell the truth. Be prepared to surgically extract the truth.
2. A good attitude goes a long way. As a lawyer, party or witness, your attitude can really impact the case. Judges and juries have to make a lot of “close calls.” If you are positive, professional and respectful, you are more likely to be liked and believed.
3. Appearances matter. Appearances affect how we feel about ourselves and how others portray us. A little confidence is a good thing. However, when it comes to the appearances of attorneys, clients and witnesses, the safest approach is to look good, but not too good. Generally speaking, you (and clients) should err on the side of dressing conservatively. Cufflinks might not be well-received by a rural jury. Exposed tattoos are risky. ALWAYS consider your venue and audience.
4. For the most part, you can't change the facts or the law. Sometimes you can't play the role of hero and must resort to damage control. That doesn't mean you're losing, it just means you have to adjust your expectations and redefine a "victory."

Tuesday, April 21, 2015

Highlights from the Annual Meeting

Thank you to everyone who attended the Annual Meeting of the ABA Forum on Construction Law from April 16 to April 18 in Boca Raton, Florida.  As our previous post mentioned, Division 1 held our planning retreat on Wednesday, April 15, prior to the seminar sessions, and we have set into place a number of exciting and interesting initiatives that will be revealed as we move forward into the next bar year.

What did people miss who did not attend the meeting?

Well, a lot!

First, who could turn down a view like this? The palm trees and warm temperatures that attendees enjoyed were in stark contrast to the rain and cold in many other parts of the country.

But, it was not just sunshine and beach days.

Our first session featured a panel discussion regarding what to do when a disaster hits a project and the media get interested.  Other sessions included a discussion on the future of business development tools, liquidating agreements, insurance coverage disputes, and how to draft invoices that clients will pay.  And those are just a few of the great topics attendees heard.

One of the highlights of a great week came at the Diversity Luncheon on Friday when civil rights icon Fred Gray spoke to the assembled lawyers and was simulcast to multiple school systems, colleges, and law schools nationwide.  Mr. Gray was introduced by past ABA President Robert Gray of Hunton & Williams.  Mr. Fred Gray was the first African-American president of the Alabama Bar and is notable for his role in representing the leaders of the civil rights movement -- including Rosa Parks and Martin Luther King, Jr. -- in their challenges to Jim Crow laws in the South.

Our own Division 1 breakfast featured the Honorable Marian Blank Horn, Judge on the United States Court of Federal Claims, speaking candidly regarding the use of ADR in government contracts cases that come before her court.

Of course, when you are talking about Division 1 and the ABA Forum on Construction Law, it is not all seriousness and seminars.  We have a lot of fun as well.

I mean, where else could you put the leader of your entire organization into a dunk tank?

Of course, the Welcome Reception on Thursday night was one of the most fun events. Here is a panoramic shot of that event.

Division 1 joined Divisions 10 and 12 on Friday night for networking, cocktails, and food.  While I did not get any photos at that event, rest assured that it was a great time meeting and eating with all the folks who made it to the event.

Then, on Friday, we were on a boat -- a catamaran, to be exact -- and we went on an enjoyable, sunshine-filled cruise south on the Intracoastal Waterway to an outlet south of Deerfield Beach then back north on the Atlantic Ocean to get back to Boca.

Nearly everyone enjoyed the cruise, the fun talking with each other, a few beers, and the ride on the ocean.

Our next national meeting will take place in Austin, Texas -- in the week in between the two weekends of the Austin City Limits music festival.

As you can see, it's the Construction ADR Summit -- right in Division 1's wheelhouse -- so be sure to make your reservations now for the seminar and for your hotel room!

Thursday, April 16, 2015

Division 1 Planning Retreat

The Steering Committee for Division 1 and a group of interested Division members met on Wednesday in Boca Raton to discuss our future plans for programs, publications, and distance learning initiatives.  The group of happy and excited D1 members who attended are pictured here (other than yours truly, Tony Lehman, who took the photo).

We have a lot of great ideas for the upcoming bar year, and we would love for you to get involved. Please contact Nick Holmes if you want to get involved with a publication, a program, or with some new ideas of your own!

Monday, April 13, 2015

Second Circuit Holds That Arbitrators -- Not the Federal Courts -- Should Determine the Preclusive Effect of a Federal Judgment Confirming An Arbitration Award

In Citigroup, Inc. v. Abu Dhabi Investment Authority, 776 F.3d 126 (2nd Cir. 2015), the issue was whether the federal court had the authority to enjoin a second arbitration filed by Abu Dhabi Investment Authority (“ADIA”) against Citigroup, Inc. (“Citigroup”) after the United States District Court for the Southern District of New York had confirmed a previous award in favor of Citigroup and against ADIA. Citigroup claimed that ADIA’s new claims were barred by claim preclusion and res judicata of the federal judgment that had confirmed the prior award because ADIA’s current claims were or could have been raised in the first arbitration.
Citing to its previous decisions that held that arbitrators are to resolve the preclusive effects of an arbitration award confirmed by a state court and a federal judgment that had been issued on the merits, the Second Circuit held that it was the arbitrators, not the federal courts, who should determine the preclusive effect of a federal judgment confirming an arbitration award. The court noted that, in confirming the award, the district court did not review the merits of any of ADIA’s substantive claims or the context in which the claims arose, considering only whether the panel’s evidentiary rulings and application of New York’s choice of law provisions violated the FAA. Accordingly, the court found that a district court unfamiliar with the underlying circumstances, transactions, and claims was not the best interpreter of what had been decided in the arbitration proceedings.
A copy of the Second Circuit’s decision is linked here.

Friday, April 10, 2015

Litigation tip: Less is often more

Below is a link to a recent article in the Oregon State Bar Bulletin authored by a legal research and writing professor at the University Of Oregon School Of Law.  While many of us find courtroom advocacy more exciting and enjoyable than legal research and writing, brief writing is arguable one of the most important skills needed for a litigator. 

The article focuses on ridding our briefs of needless words.  The author provides four techniques for brevity that all litigators should practice: 1) use a high ratio of working words to glue words; 2) use the active voice; 3) avoid word-wasting phrases; and 4) use base verbs rather than nominalizations.  These points are not novel, but this article does provide a good refresher course on the art of brevity.  In staying true to the topic, this concludes my post! 

Thursday, April 9, 2015

Appointing an Expert with Final and Binding Decision Authority

By Ben D. Nolan, III PE PSP, Managing Director, Construction Consulting, Berkeley Research Group LLP
Based on a True Story

The Situation

Imagine a situation where a large international general contractor has been terminated for default mid-project on two major unbonded educational campus projects on a UK protectorate island.  The government takes assignment of the subcontractors, who happen to be the only competent subcontractors on the island, to continue progressing the work until a completion General Contractor can be hired.  A year later, there has been only an additional ten percent progress and, due to a payment dispute, the subcontractors decide to terminate the government for default. After some negotiation, the parties agree to a termination for convenience and attempt to follow the contract ADR procedures, but they are generally unworkable given the peculiarity of the situation.  As a last resort, the parties agree to a mediation using an experienced Quantity Surveyor from the UK; the mediation fails miserably and the parties are at the end of the contractual ADR options.

The parties are determined to keep the pending dispute out of the island court system, so they get creative.  Queen’s Counsel suggests the appointment of an independent Expert to decide the disputes.  Candidates are identified from a global pool, a short list of face to face interviews are held, the preferred Expert spends a week with the parties working through representative issues and the parties agree on the Expert.  The resulting appointment agreement includes this clause:

“The parties agree that all decisions and awards made by Expert in the course or at the conclusion of the Valuation Exercise shall be final and binding on the parties…and the parties also waive irrevocably their right to any form of appeal, review, or recourse to any court or other authority with jurisdiction, insofar as such waiver may be validly made.”
This clause is the essence of the Expert with Final and Binding Decision Authority (“BDA”) ADR process.  To coin a phrase, I’ll call this particular ADR process the “BDA” process and the Expert the “BDA Expert”.

To Bind or Not to Bind

Having been that appointed BDA Expert and having issued that final, binding decision, I see many complex construction disputes that could potentially benefit from this BDA approach to ADR.  However, US litigators have not been inclined to take the leap of faith required to entrust a BDA Expert with their client’s fate in a construction dispute.  I believe with a little more understanding of their slightly altered role in the ADR process, US litigators could accept this binding ADR process to fairly resolve certain types of construction-related disputes.

There are many popular variations of non-binding ADR which involve independent expert analysis and recommendations, but none that I’m aware of that give the Expert this final and binding decision authority.  The primary reason is that the US litigators want to stay in control of the legal process.  This fear of being out of control (i.e. out of appeal options) is largely unfounded.  In the BDA process, the US litigators are still in control of the legal process, they are simply dealing with a very involved Expert instead of a lesser involved Dispute Resolution Board, a neutral listener, a mediator, an arbitrator, a panel of arbitrators, a judge or a jury.  Any arguments that would be made on appeal are made during the review of the Draft decision.

It is also crucial to recognize the difference between the level of involvement of the BDA Expert and these other triers of fact: the BDA Expert has complete access to all the facts from all parties throughout the analysis phase and decision process.  While the starting point is the traditional plaintiff’s statement of claim, from that point forward, the BDA Expert decides which claims merit consideration, works with the plaintiff and defendant to perfect the claim facts and conclusions, allows rebuttal from the defendant, allows re-statement of claims from the plaintiff, finalizes the BDA Expert analysis and issues a written DRAFT decision.  The parties can respond to the DRAFT decision, discuss any final points with the other parties and the BDA Expert and, after hearing all arguments, the BDA Expert finalizes the decision on that issue.  This process is repeated for all issues that are agreed to be decided.  In my experience, both parties were satisfied with the fairness of each decision, knowing that they had enjoyed the full benefits of natural justice.

Recognizing the Situation to Suggest Expert BDA

US litigators with experience in international construction dispute resolution will likely recognize the BDA Expert model, as it is an established ADR process in international venues.  In the US, disputes with certain characteristics would likely be good candidates for the BDA Expert approach:

  • When the parties desire to design an expedited decision-making process on key disputed issues.
  • When the parties desire the trier of fact to master the technicalities of large, complex technical disputes in order to fully understand and consider the underlying root cause of the dispute, including:
    • causes of late and out of sequence work,
    • causes of labor productivity problems,
    • assessing “or equal” equipment or material substitutions,
    • causes of equipment and material cost escalation,
    • responsibilities for design versus shop drawing details,
    • causes of equipment performance problems, and other things.
  • When the parties desire to have individual decisions on a large number of disputed issues, such as:
    • an independent valuation of base contract work completed;
    • an analysis of entitlement to and valuation of disputed change orders;
    • an analysis and valuation of partially completed value engineering work;
    • a valuation of deductive credits for incomplete work or work not performed;
    • auditing of incurred costs in a termination for convenience;
    • an adjustment of final contract value due to the costs of correcting defective work;
    • an interpretation of disputed contract terms, such as the “value” of work completed under an AIA contract, i.e. is it the contract value or the actual cost incurred?
  • When the parties desire to keep the dispute in a private ADR venue.
  • When the parties desire to turn the decision over to a trusted third party.
  • When the situation is so peculiar that other forms of ADR are unworkable.
  • When the parties need to disclose, yet protect, commercially sensitive and auditable information.
  • When the percipient witnesses are still available to participate as fact accelerators in the dispute resolution process.
  • When the parties desire to maintain their business relationship with each other by reaching a fair resolution.
  • When the parties desire an “open-book” approach to dispute resolution.

The Recommendation

Based upon my favorable experience with this BDA process, I recommend that US litigators consider this form of ADR in certain construction disputes.  It is a bold step for litigators to suggest an approach to ADR providing a BDA Expert with such final decision authority.  However, there is more fairness designed into this ADR process than in most other ADR processes, given the opportunities to state and re-state claims and to assure all your arguments are heard, fair and square.