Sat | Sep 22, 2018

Cedric Stephens | Mediation as a time-saving insurance tool

Published:Sunday | July 29, 2018 | 12:00 AM

Barbara Gayle's article in last Sunday's Gleaner - 'See you in 2022: Four-year waiting list for civil cases in the Supreme Court' - was heartbreaking.

It was about a woman who was injured in a motor vehicle accident. The mishap probably occurred in 2014 or before. She "wept uncontrollably" after she learnt from her lawyer "that the first available date for the trial of her lawsuit would be in 2022".

That news put her in a state of "disbelief and shock". Her case has been going "back and forth" for the last four years. She is in pain every day, can hardly walk, and cannot afford to buy medication.

There are hundreds - perhaps thousands - of victims of motor vehicle accidents across Jamaica like her. Some are children who are dependents of persons who were killed in crashes. The compensation system, consisting of motor vehicle insurers, lawyers, court administrators, and others, as inferred under the Motor Vehicle Insurance (Third-Party Risks) Act, MVITPRA, places them under a great amount of stress.

Getting compensation is often a long and difficult process even when one is familiar with the process. Six of the articles that I wrote this year over a seven-week period, namely 'Motor insurance law shortchanging accident victims', 'The smart approach to personal injury coverage', 'A cry for justice, Minister Chuck, Curbing the problem of uninsured drivers', 'Claims settlement through dispute resolution' and 'Unfairness in insurance contracts', highlight some of the difficulties.

The problem analysis by the court official and Jamaican Bar Association president in Ms Gayle's article was, in my opinion, only partly correct. They cited the need for more judges.

Minister of Justice Delroy Chuck's analysis is more on point. He doesn't believe that more judges alone will fix the problem. All parties in the litigation process - claimants (litigants or plaintiffs), attorneys, judges, court officials, and insurers - and institutions outside of the system, like the insurance regulator, have important roles to play. When this happens, the effectiveness of the compensation system will improve.

 

TRIAL NOT ALWAYS NEEDED

 

Not every case has to go to trial before a judge, Mr Chuck argues. Some can be settled through the process of mediation. Independent dispute resolution is one of the mechanisms that is recommended by the International Association of Insurance Supervisors (IAIS).

Jamaica is a member of the IAIS. That institution was referred to in my May 6 article. In some jurisdictions, according to the minister of justice, 70 per cent of cases are settled using this method. In Jamaica, only 40 per cent are settled this way.

Shouldn't the injured woman's attorney have known about the backlog of cases in the court long before seeking a trial date and advised her accordingly? Were alternative dispute resolution strategies employed?

The Insurance Association of Jamaica's website unlike that of its Canadian counterpart, Insurance Bureau of Canada provides no information about how complaints are handled by the industry. There is also no guidance to consumers, especially motor insurance buyers, about how disputes can be resolved outside of the overworked court system.

 

INDUSTRY'S FAILURE

 

Is the industry's failure to mention mediation as one of the ways to resolve disputes signalling to the public and members of the legal profession that its preferred method is the long-drawn-out process of litigation?

The industry's omission is more puzzling in light of two other facts. One is the huge backlog of cases in the courts. The other is information that was telegraphed to the sector by the insurance regulator in a document titled Market Conduct Guidelines on Best Practice for Motor Insurance Claims in 2014.

The paper said, in part, that the Financial Services Commission "intends to act in accordance with its statutory powers in cases where the guidelines are breached, that is, where insurers fail to settle claims regarded as 'clean'. It is, therefore, necessary for a mediation process to be established to complement the guidelines and to assist in the resolution of disputed claims.

"To this end, the commission will encourage the industry to include an alternate dispute resolution clause offering mediation as an option to clients. This clause could be included in all policies issued by general insurance companies offering the motor class of business."

 

Why has nothing happened on this subject over the years?

 

What is mediation? FindLaw for Legal Professionals online provided the most useful explanation. It said: "Mediation is a procedure in which the parties discuss their disputes with the assistance of a trained impartial third person who assists them in reaching a settlement. It may be an informal meeting among the parties or a scheduled settlement conference. The dispute may either be pending in a court or potentially a dispute which may be filed in court.

"Cases suitable for mediation are disputes in commercial transactions, personal injury, construction, workers compensation, labour or community relations, divorce, domestic relations, employment, or any other matters which do not involve complex procedural or evidentiary issues. Attendance at the mediation conference is voluntary by the parties, except where governed by statute or contract clause.

"The mediator is a person with patience, persistence and common sense. She/he has an arsenal of negotiation techniques, human dynamics skills and powers of effective listening, articulation and restatement. The mediator is a facilitator who has no power to render a resolution to the conflict. The parties will fashion the solution as the mediator moves through the process. In many jurisdictions, the mediator is an attorney but cannot give legal advice while in the role of a mediator.

"However, the mediator's subject area expertise may be beneficial to the parties in wording and framing the mediated agreement or in circumstances where the parties are open to neutral case evaluation."

It would be most interesting to hear from the local Dispute Resolution Foundation whether the demand for its services from insurance companies is increasing.

I hope that the information in this article will help some of the victims of road accidents to resolve their problems more quickly. The legislative and other remedies that the minister of justice referred to will take some time to bear fruit.

- Cedric E. Stephens provides independent information and advice about the management of risks and insurance. For free information or counsel, write to: aegis@flowja.com