New York Dispute Resolution Lawyer
Many in our ADR community have already chosen to side with one of the choruses of polarized voices that are either supportive of or critical of the recent judicial decision In re Cody W. Smith. In that decision, Chief United States Bankruptcy Judge Jeff Bohm disallowed the trustee’s appointment of a mediator, because, inter alia, the trustee didn’t first secure the approval of the presiding bankruptcy judge. A cursory read of Judge Bohm’s decision mistakenly leads us to believe that the case is just about a bankruptcy trustee’s obligation to follow section 327(a) of the Bankruptcy Code, requiring a trustee to obtain the approval of the court prior to spending the estate’s money on professionals such as a mediator. The rationale for this rule is to “contain the estate’s expenses and avoid intervention by unnecessary participants.” However, a more nuanced read of the case ethically challenges us to question existing practices about how mediators get appointed to cases, which cases are appropriate for mediation, and the distinct, but sometimes overlapping, contribution both attorneys and mediators offer in resolving a case.
Reprinted with permission from the New York State Bar Association.