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The Use of ADR in Maritime Disputes

AS SEEN IN... JAMS has grown into the largest private arbitration and mediation service in the world. The Irvine-headquartered organization fields 26 resolution centers across the globe, and calls on an experienced panel of nearly 300 full-time neutrals of retired judges and attorneys to preside over disputes. The extensive network of specialists at JAMS ensures that it has the capacity to handle multi-party, complex cases in virtually all areas of the law. As high-profile maritime disputes continue to make waves across the globe, retired judges Garrett E. Brown Jr., Scott J. Silverman and Frederic N. Smalkin took the opportunity to highlight the key trends driving the use of alternative dispute resolution (ADR) in maritime disputes. what are the key drivers behind the growing profile of international maritime disputes? JAMS: Public interest in maritime disputes is by no means a new, or even modern phenomenon. Indeed, maritime disputes – which are often compelling sea- stories – have seemingly always fascinated the public mind, from Homer’s The Odyssey, to the present-day dramas that continue to unfold off of East Africa. Equally enduring is the historically-constant relevance of maritime commerce and transit to the global economy. Today, as in ancient times, ships and shipping-lanes are relied upon to facilitate the movement of both goods and people around the world. Given the modern advent of virtually ‘real-time’ global media coverage of newsworthy events, it is not surprising that the public’s time-honored interest in maritime disputes has continued. In the past, oil spills, rig explosions, and commercial shipping mishaps have garnered most of the headlines. Recently, the media and public have demonstrated an overwhelming interest in cruise line accidents such as the Costa Concordia. It is likely because so many people take cruises so they can relate to these accidents, even if they are exceedingly rare. t o what extent have litigants become more likely to turn to adr to solve maritime disputes over recent years? JAMS: Today, the world’s three largest cruise lines resolve all of their crewmember disputes through arbitration. That was not the case 10 years ago when all of those disputes were heard in the public courts. That said, arbitration has long been the method for resolving maritime disputes. There are a number of reasons why the maritime community prefers arbitration to traditional litigation. Some of the primary reasons include the privacy of the proceedings - the panel that decides the dispute typically consists of people with maritime experience as opposed to jurors with limited maritime knowledge - and of course, disputes are resolved much faster than those heard in the public courts. Another major factor is that since most countries are signatories to the 1958 New York Convention, an international arbitration award is enforceable in those countries without the need to go through the laborious, expensive and unpredictable procedure associated with domesticating a foreign judgment. what are the key attributes of arbitration and mediation that make those methods useful tools for resolving maritime disputes? JAMS: Whether a dispute is a wet case, arising from a The U Se of ADR in M ARiTiMe Di Sp UTe S Three panelists from JAMS discuss the increasing use of alternative dispute resolution as a method for resolving disputes in the maritime sector. reporter MArIA JACKSoN put S the queStIoNS to JAMS GArrett e . Brow N, Jr. JAMS SCott J. SILVer MAN JAMS FreD er IC N. SMALKIN JAMS Q & A sponsored section jamsadr.com FALL 2014 LATINAMERICA LATINAMERICAcollision or allision, or is a dry case, stemming from a disagreement over the terms of a charter party or bill of lading issues, it is in the interest of all in the maritime trades to achieve a quick, relatively inexpensive, and reasonable resolution. In many countries, litigation can be frightfully expensive. For example, complaints are often made about the costs arising from the wide-ranging pre-trial discovery rules in United States litigation. Delays are often encountered in litigation, and the process is public in nature. ADR aims at achieving a quicker and less expensive resolution than litigation. Arbitration has long been a preferred method for relatively quick, fair, and comparatively inexpensive method of resolving dry cases, and it has thus traditionally been provided in many contracts of carriage and charter parties, much more frequently than in many other trades. Mediation also has a place, especially in wet cases where there is no contractual relationship calling for arbitration between the parties. A mediator experienced in maritime law can more often than not help the parties negotiate a fair and reasonable settlement of their dispute at relatively little cost, compared to litigation. as foreign investors continue to pour into l atin america, how effective is adr in ensuring that clients are protected in multi- jurisdictional disputes? JAMS: As previously noted, choice is a key advantage to the resolution of maritime disputes via ADR, and the force of that maxim is clearly exhibited within the realm of multi- jurisdictional disputes. International news is replete with stories of large-scale disputes being litigated in multi-national venues that one or both parties have not chosen. In those cases, the seemingly unavoidable result is inconvenience, frustration, and significant cost increases – not to mention sometimes- questionable and often unenforceable verdicts. Because ADR is based upon the parties’ agreement, it inherently provides increased control over the resolution of a given dispute through the many advantages of choice. In the context of maritime disputes, those advantages appear axiomatic when juxtaposed with the realities of multi-jurisdictional litigation. in adr the importance of choosing the right professional to oversee sensitive cases is key; what skills and experience distinguish jams ’ neutrals as leaders in complex disputes? JAMS: It is of paramount importance to a just and efficient resolution of a maritime dispute to choose arbitrators and mediators skilled not only in law and dispute resolution, but with special knowledge about maritime matters. For example, in the United States, admiralty jurisdiction is vested in the federal district courts and retired judges of those courts, many of whom are available through JAMS, are likely to be familiar with maritime law. In addition, some JAMS arbitrators and mediators have had extensive private practice in maritime law and/or academic maritime law training. In short, JAMS is ready to provide maritime interests and attorneys with a broad palette of experienced, skillful, and trustworthy arbitrators and mediators. about the a uthors: Hon. Garrett E. Brown Jr. (Ret.) gbrown@jamsadr.com Hon. Garrett Brown (Ret.) joined JAMS after a distinguished judicial and legal career. He served for 26 years as United States District Judge for the District of New Jersey, the last six as Chief Judge, where he led the court-wide effort to provide prompt, efficient justice to civil litigants and to implement new local patent rules. Prior to appointment to the federal judiciary, he served as Chief Counsel and Acting Administrator of the U.S. Maritime Administration and as General Counsel of the U.S. Government Printing Office. Scott J. Silverman ssilverman@jamsadr.com Scott Silverman began working in Miami’s JAMS resolution center the day after he retired from Miami’s Circuit Court. Previously, he served as a South Florida judge for nearly 22 years and experienced just about every type of case that came before the Circuit Court in the civil, criminal, and family divisions. At JAMS, he realized that his past public service was a valuable asset during mediations. He could impart first-hand knowledge about the complexities of the jury system, the makeup of juries, the risks attendant with jury trials, the costs of trials, case/trial time lines, trial statistics, and the judicial mindset. Without a doubt, his previous experiences make him an effective mediator. Hon. Frederic N. Smalkin (Ret.) fsmalkin@jamsadr.com Hon. Frederic Smalkin (Ret.) is based in the JAMS Greenbelt Resolution Center. He served as a Chief Judge of the U.S. District Court, District of Maryland for nearly two years. Prior to being appointed as District Judge in 1986, he served as a United States Magistrate for the District of Maryland for 10 years. During his years of service as a U.S. Magistrate, Judge Smalkin concentrated on pioneering the role of Federal Magistrates in civil litigation, especially as settlement mediators. He has successfully settled hundreds of cases and taught mediation skills to others. Judge Smalkin holds an LL.M. in Maritime Law from the University of London. “Whether a dispute is a wet case, arising from a collision or allision, or is a dry case, stemming from a disagreement over the terms of a charter party or bill of lading issues, it is in the interest of all in the maritime trades to achieve a quick, relatively inexpensive, and reasonable resolution.” “It is of paramount importance to a just and efficient resolution of a maritime dispute to choose arbitrators and mediators skilled not only in law and dispute resolution, but with special knowledge about maritime matters.” Presented by JAMS. Reprinted with permission from the Fall 2014 edition of FOCUS LATIN AMERICA an ALM Supplement to THE AMERICAN LAWYER © 2014 ALM Media Properties, LLC. All rights reserved. Further duplication without permission is prohibited. For information, contact 877-257-3382 or reprints@alm.com. # 001-100-12-14-02 sponsored section jamsadr.com
JAMS has grown into the largest private arbitration and
mediation service in the world. The Irvine-headquartered
organization fields 26 resolution centers across the
globe, and calls on an experienced panel of nearly 300
full-time neutrals of retired judges and attorneys to
preside over disputes.
The extensive network of specialists at JAMS ensures that
it has the capacity to handle multi-party, complex cases
in virtually all areas of the law. As high-profile maritime
disputes continue to make waves across the globe, retired
judges Garrett E. Brown Jr., Scott J. Silverman and
Frederic N. Smalkin took the opportunity to highlight the
key trends driving the use of alternative dispute resolution
(ADR) in maritime disputes.
what are the key drivers behind the
growing profile of international
maritime disputes?
JAMS: Public interest in maritime disputes is by no
means a new, or even modern phenomenon. Indeed,
maritime disputes – which are often compelling seastories
– have seemingly always fascinated the public
mind, from Homer's The Odyssey, to the present-day
dramas that continue to unfold off of East Africa. Equally
enduring is the historically-constant relevance of maritime
commerce and transit to the global economy. Today, as
in ancient times, ships and shipping-lanes are relied upon
to facilitate the movement of both goods and people
around the world. Given the modern advent of virtually
‘real-time' global media coverage of newsworthy events, it
is not surprising that the public's time-honored interest in
maritime disputes has continued.
In the past, oil spills, rig explosions, and commercial
shipping mishaps have garnered most of the headlines.
Recently, the media and public have demonstrated an
overwhelming interest in cruise line accidents such as the
Costa Concordia. It is likely because so many people take
cruises so they can relate to these accidents, even if they
are exceedingly rare.
To what extent have litigants become
more likely to turn to ADR to solve
maritime disputes over recent years?
JAMS: Today, the world's three largest cruise lines resolve
all of their crewmember disputes through arbitration. That
was not the case 10 years ago when all of those disputes
were heard in the public courts.
That said, arbitration has long been the method for
resolving maritime disputes. There are a number of
reasons why the maritime community prefers arbitration
to traditional litigation. Some of the primary reasons
include the privacy of the proceedings - the panel
that decides the dispute typically consists of people
with maritime experience as opposed to jurors with
limited maritime knowledge - and of course, disputes
are resolved much faster than those heard in the public
courts. Another major factor is that since most countries
are signatories to the 1958 New York Convention, an
international arbitration award is enforceable in those
countries without the need to go through the laborious,
expensive and unpredictable procedure associated with
domesticating a foreign judgment.
What are the key attributes of
arbitration and mediation that make
those methods useful tools for resolving
maritime disputes?
JAMS: Whether a dispute is a wet case, arising from a collision or allision, or is a dry case, stemming
from a disagreement over the terms of a
charter party or bill of lading issues, it is in the
interest of all in the maritime trades to achieve
a quick, relatively inexpensive, and reasonable
resolution. In many countries, litigation can be
frightfully expensive. For example, complaints
are often made about the costs arising from the
wide-ranging pre-trial discovery rules in United
States litigation. Delays are often encountered
in litigation, and the process is public in nature.
ADR aims at achieving a quicker and less
expensive resolution than litigation. Arbitration
has long been a preferred method for relatively
quick, fair, and comparatively inexpensive
method of resolving dry cases, and it has thus
traditionally been provided in many contracts
of carriage and charter parties, much more
frequently than in many other trades. Mediation
also has a place, especially in wet cases where
there is no contractual relationship calling for
arbitration between the parties. A mediator
experienced in maritime law can more often
than not help the parties negotiate a fair and
reasonable settlement of their dispute at
relatively little cost, compared to litigation.
AS foreign investors continue
to pour into Latin America, how
effective is ADR in ensuring that
clients are protected in multijurisdictional
disputes?
JAMS: As previously noted, choice is a key
advantage to the resolution of maritime
disputes via ADR, and the force of that maxim
is clearly exhibited within the realm of multijurisdictional
disputes. International news is
replete with stories of large-scale disputes
being litigated in multi-national venues that
one or both parties have not chosen. In those
cases, the seemingly unavoidable result is
inconvenience, frustration, and significant
cost increases – not to mention sometimesquestionable
and often unenforceable verdicts.
Because ADR is based upon the parties'
agreement, it inherently provides increased
control over the resolution of a given dispute
through the many advantages of choice. In the
context of maritime disputes, those advantages
appear axiomatic when juxtaposed with the
realities of multi-jurisdictional litigation.
In ADR the importance of
choosing the right professional
to oversee sensitive cases is
key; what skills and experience
distinguish JAMS' neutrals as
leaders in complex disputes?
JAMS: It is of paramount importance to a
just and efficient resolution of a maritime
dispute to choose arbitrators and mediators
skilled not only in law and dispute resolution,
but with special knowledge about maritime
matters. For example, in the United States,
admiralty jurisdiction is vested in the federal
district courts and retired judges of those
courts, many of whom are available through
JAMS, are likely to be familiar with maritime
law. In addition, some JAMS arbitrators and
mediators have had extensive private practice
in maritime law and/or academic maritime
law training. In short, JAMS is ready to provide
maritime interests and attorneys with a
broad palette of experienced, skillful, and
trustworthy arbitrators and mediators.