ADR: doing two things at once can be problematic.

A hybrid form of alternative dispute resolution known as med-arb--shorthand for mediation-arbitration--is one of the newest kids on the block, but not everyone is enthusiastic about its arrival.

Lee Hugh Goodman, head of Mediated Settlement Service, in Northbrook Illinois, charges that defendants may be exploiting weaknesses in this form of ADR to take advantage of plaintiffs.

Med-arb, as its name implies, is part mediation and part arbitration. It works like this: Two parties to a dispute decide that a mediator--whose main function is to facilitate their discussions--will help them resolve their differences. During this first phase, they each tell the mediator what they want from the opposition, perhaps divulging significant details of their argument to this facilitator.

If it turns out the two parties are far apart on most points of debate and are getting nowhere--even with a mediator acting as the go-between--they enter the second phase of the process, which is arbitration. Here, an arbitrator holds a hearing that is not quite as formal as a courtroom proceeding, but the parties have to abide by certain rules for admitting evidence and other legal canons. The arbitrator then hears the case and has the final word, which is binding. No questions asked.

Pretty standard stuff in the world of ADR. In the majority of med-arb cases, however, one big difference exists from the usually separate mediation and arbitration proceedings: The mediator and the arbitrator may be the same person.

This difference is not an academic one to many plaintiff lawyers who are seeking swift and economic justice for their clients. The person who acted as mediator was privy to information--perhaps hearsay from the defendant--that would never have made it into a courtroom or, for that matter, an arbitration proceeding. The mediator then switches hats, taking on a far more powerful position as arbitrator in the proceeding and deciding the fate of the parties.

"It looks like a legitimate form of ADR," Goodman said. "It's being presented as one of many tools that attorneys can use, but I can't imagine why any plaintiff attorney would choose this for their client when they know the cases almost never end up being mediated. They end up being arbitrated."

Other ADR proponents are also uncomfortable with the hybrid process, which has been used--albeit somewhat sparingly--during the past two years by feuding parties to a variety of suits.

James Henry, president of the nonprofit CPR Institute for Dispute Resolution in New York City, said there is "an accelerating trend to insert med-arb clauses into various contracts [such as those for insurance] on a wide basis.

"If the parties fail in the mediation process, they'll often want a fallback short of arbitration or litigation. That's what med-arb is, but you should not have the same person acting as the mediator and arbitrator unless both parties are in total agreement with that."

Henry explained that the success of mediation is built on the mediator's ability to "capture the confidence" of each party. "I find it difficult to argue against mediation in any instance because you can always walk away from the process," he said. "But if you had a mandatory program in a company that said you, the consumer or the employee, will mediate, and, if that fails, you will arbitrate as a condition of your employment, then I have a problem with that if you've got the same person in both mediator and arbitrator roles.

"It happens on occasion when parties are content with the idea of the mediator continuing as the arbitrator. If the parties are agreeable to it and are fully informed, it can work."

Thomas Stipanowich, a law professor specializing in arbitration and conflict resolution at the University of Kentucky, agreed.

"A number of people are telling me that they've been asked to wear multiple hats. I've been asked to," Stipanowich said. "I think we're going to see more and more of that.

"I don't think it should be the usual thing, but in situations where the parties are sophisticated enough to make a choice and understand the potential impact, I have no compunction about going forward. I have been willing to play both roles."

Stipanowich cautioned, however, that med-arb is subject to abuse by parties who have the inclination and the know-how to exploit the system. They may, for example, try to influence a mediator's opinion while they've got the chance--before the mediator takes on the arbitrator's role.

"There are practical, legal, and ethical issues that still need to be addressed," he said. "Would this work across the broad run of cases? I don't think so. It should be the exception, not the rule."