Minnesota’s system has many virtues. Procedural consistency isn’t one of them.
By Courtney Ernston
Conciliation court offers a dispute resolution process for people pursuing small claims without forcing them to hire an attorney, spend countless hours doing discovery, present legal arguments, or become familiar with the rules. But what these courts lack in formality, they unfortunately also lack in procedural consistency. If a litigant were to have seven different conciliation court cases in seven different courts throughout Minnesota, chances are every single hearing would be conducted differently. This lack of uniformity frequently leads to confusion and chaos. Speaking of confusion and chaos, the coronavirus pandemic has, perhaps not surprisingly, elicited differing responses from the state’s conciliation courts. The last portion of this article will discuss the wrench that has been thrown into an already stressed system, which now begs the question, can we use this as a time to reset and start over?
Background: A theoretical paradise
Conciliation courts were originally established in France in 1790.1 The original concept was to take a dispute between two parties of similar social standing and place it in the hands of someone belonging to a higher social stratum.2 The impulse was to minimize litigation and persuade parties to settle on a recommendation of the judge.3 Debates about the merits of conciliation court were widespread in the mid-19th century.4
Over time, this system evolved into the one we currently have, which is similar apart from the social class aspect. Today conciliation court, aka small claims court, consists of individuals or companies attempting to informally resolve their disputes quickly and cheaply before a trained referee or judge. While conciliation court dollar limits vary widely in the United States—from $2,500 to $25,000—Minnesota has the second highest conciliation court limit in the country, allowing a plaintiff to seek up to $15,000.
Reality: A beautiful mess
Minnesota Statute §491A.01 provides that each district court in the state of Minnesota shall establish a conciliation court. The statute goes on to describe the conciliation courts’ powers and jurisdiction as being the same as that of a district court for ordinary disputes up to $15,000.5 This relatively high limit allows conciliation courts to take a lot of the burden off district courts.
Conciliation courts are subject to certain limitations,6 but generally they provide an excellent remedy without requiring litigants to be familiar with the rules of civil procedure, evidence, discovery, or general practice. But there are several issues with the lack of uniformity that can cause conciliation court to go from an easy, low-cost solution to a complex and uncertain mess.
To begin a case, the plaintiff files a relatively short Statement of Claim and Summons, which gives a very generic description of the issue and the relief sought. If the claim is less than $2,500, the court administrator serves the defendant.7 If the claim is in excess of $2,500, the plaintiff must serve the defendant by certified mail.8 “Service by mail, whether first-class or certified, shall be effective upon mailing.”9 While the rule seems relatively straightforward, some referees or judges will continue a hearing if the plaintiff’s certified mail is returned, even if it was due to the defendant’s refusal to accept the certified mail. This increases the cost and burden to a litigant, regardless of whether they are represented by counsel.
If the defendant receives the statement of claim, it can bring a counterclaim if it’s within the jurisdictional dollar amount limit of $15,000. If the counterclaim is in excess of $15,000, the defendant can remove the case to district court by filing an affidavit.10 The affidavit must state that the defendant “has commenced or will commence within 28 days an action against plaintiff…”11 Despite the rule that states that “[t]he pleadings in conciliation court shall constitute the pleadings in district court,”12 a defendant cannot commence an action in district court as a defendant; thus they become the plaintiff, and the former plaintiff is forced to become the defendant.
If the case is not removed to district court, a hearing date is set. For those individuals or companies that choose to hire an attorney to assist, the inconsistencies during the hearing make it practically impossible for the attorney to help the client understand what to expect. The best example of this is contained in the Minnesota General Rules of Practice as they relate to the role of an attorney in the proceedings.13 The rule states that the parties “…may be represented by a lawyer admitted to practice law before the courts of this state. A lawyer representing a party in conciliation court may participate in the trial to the extent and in the manner that the judge, in the judge’s discretion, deems helpful.”14 (Emphasis added.)
Owing to this nearly limitless discretion, the attorney must explain to the client myriad possible outcomes at the hearing—and attempt to prepare the client for all of the likely scenarios. As an attorney who regularly represents businesses in conciliation court, I have experienced everything from the conciliation judge who allowed me to present nothing more than legal objections to the one who permitted me to put on a mini-trial that included opening and closing statements, direct and cross-examination, and formal introduction of exhibits. Some courts also require mandatory pre-trial settlement conferences, which increases the cost of hiring an attorney. I’ve also had conciliation judges refuse to allow me to appear without having previously filed a request for permission to appear before the conciliation judge, despite there being no conciliation court rule that requires such a request.
An aggrieved party has the right to appeal the decision of the conciliation judge to district court.15 The rules for appeal constitute another example of district courts adding yet another layer of uncertainty. All cases appealed to district court in Dakota County, Hennepin County, Olmsted County, and the 6th Judicial District are placed on the expedited litigation track (ELT).16 Within the ELT designation, judges have the discretion to set an immediate trial date with no other scheduling, to order mediation, or to issue an abbreviated discovery plan.17 In those counties or districts that have no expedited litigation track, the appeal results in a full-blown lawsuit, drastically changing the time and money required. The result is a free-for-all in which the rules are largely judge-dependent. In these instances, it is nearly impossible to tell a client what an appeal would cost or entail. Coupled with the fact that a business cannot represent itself in district court,18 this ensures that businesses are often set up for failure from the outset. Needless to say, all of this means that conciliation court misses a core value within the framework of U.S. jurisprudence: consistency.
Destined for greatness: overcoming adversity
Despite these issues, conciliation court is increasingly popular and has broken new ground in recent years. Conciliation courts have become increasingly popular venues for divorce mediation.19 Not only is this form of dispute settlement less costly and less combative, it has proven extremely efficient. A study of one U.S. county’s first 200 divorce cases, as an example, found that only 14 percent of the cases returned to court.20 The parties saved money, and the study estimated the county’s savings to be $175,044.
Conciliation court has also made its way into immigration law.21 Conciliation court in the realm of immigration has been praised as “unfettered by technicalities” with “judges [who] are peacemakers.”22 It also allows parties to tell their story, often highly personal in nature, without lawyers confusing litigants with legal jargon and formal processes conducted in a foreign language.
That’s not to say that conciliation court is viewed fondly in all quarters. The NAACP, to cite a prominent example, has long taken the position that persons of color denied service in public places should choose district court over conciliation court.23 It explains that courts following settled procedures provide less opportunity for arguments circumventing the law—such as the defendant’s argument in one case that the plaintiff was denied service not due to their color but their “unique body odor.” Conciliation court handles these matters off the record, making judges less accountable. Judges will not have to return and justify former positions when new cases arise.
Despite its flaws, conciliation court provides an important and affordable forum to ensure that everyone has the opportunity to be heard—a core tenet of our legal system. Conciliation court is also seen as a progressive form of alternative dispute resolution.24 But the inconsistencies in the system amount to stumbling blocks not only for attorneys but for pro se litigants who enter with no idea of the procedures this particular conciliation judge will employ. Should a pro se litigant be expected to know how to cross-examine a witness or introduce evidence if the judge decides on the mini-trial format? An experienced attorney can usually think on his or her feet and come up with an opening and closing, but what about the average person? These are reasons why all parties would benefit from a clear understanding of how the hearing will proceed.
Reconciliation: Judgment day
The Wild West nature of conciliation court allows for both increased efficiency and decreased consistency. In comparison to the relative procedural predictability of regular litigation, conciliation court can be seen as a roll of the dice. The need for better regulation of alternative methods of resolving disputes is widely understood;25 how this will be done remains open to interpretation.
How do we increase the formality of conciliation court in Minnesota just enough that consistency is no longer an issue without losing what is loved about conciliated disputes? While the possibilities are endless, I believe the best way forward involves several changes to the rules. First, conciliation judges’ complete discretion over attorney participation should either be throttled back, or conciliation judges should be required to create judicial preference pages similar to those posted by district court judges. If the judge or referee conveys how he or she runs a conciliation court hearing, the parties can be adequately prepared. Second, refine the rule for a counterclaim that is in excess of $15,000 by putting forth requirements that the plaintiff commence the action in district court within a certain time and serve a formal complaint, to which the defendant may respond and assert its counterclaims. Finally, expand the ELT program to all districts to ensure that conciliation appeals follow a uniform procedure. These steps would allow conciliation court to remain an effective tool for smaller disputes while also ensuring more uniformity and clearer expectations.
Conciliation court and covid-19
Covid-19 has changed the way that everything operates, conciliation courts very much included. It should come as no surprise that decisions about remaining open and hearing cases were not made uniformly across all conciliation courts. Below is a view into the capacity at which individual conciliation courts have operated:
|
County
|
Pending conciliation cases as of week of March 16, 2020
|
Pending conciliation cases as of week of July 6, 2020
|
Conciliation cases with a hearing held since March 16, 2020
|
|
Anoka
|
1,327
|
1,667
|
2
|
|
Carver
|
115
|
98
|
98
|
|
Dakota
|
723
|
1,201
|
7
|
|
Hennepin
|
2,744
|
3,884
|
23
|
|
Ramsey
|
991
|
1,707
|
7
|
|
Scott
|
296
|
334
|
75
|
|
Washington
|
755
|
840
|
200
|
* Statistics provided by the State Court Administrator’s Office
It appears that all but Carver County have become even more backlogged due to the pandemic, with some courts forced to put more cases on hold than others. Decisions about when to reopen, when to try cases in person, and at what capacity the court will be running have been made unilaterally by each court. Scott County, for example, has been holding scheduling hearings while most counties have recently started rescheduling of hearings. Hearings will not be held in person when they do resume. While covid-19 has changed the way that conciliation courts have operated, it has left the theme of conciliation intact: Everyone does things a little differently.
COURTNEY ERNSTON is a partner and head of litigation at Minnesota Construction Law Services, where she represents contractors in disputes; both large and small. She is actively involved in a number of organizations throughout the legal and construction community and loves working with her amazing team.
The author wishes to thank Benjamin Stowers for his assistance on this article.
Notes
1 Deciding Against Conciliation: The Nineteenth-Century Rejection of a European Transplant and the Rise of a Distinctively American Ideal of Adversarial Adjudication, 10 Theoretical Inq. L. 423.
2 Id.
3 Id.
4 Id.
5 Minn. Stat. 491A.01 Subd. 3.
6 Notable exceptions to conciliation court jurisdiction include actions involving title to real estate, defamation, specific performance, class actions, prejudgment remedies, injunctions, certain state-owed debts, eviction, and malpractice. Conciliation court’s informality makes it an improper candidate for these types of cases. Minn. Stat. 491A.01 Subd. 4.
7 Minn. R. Gen. Prac. 508(d)(1).
8 Minn. R. Gen. Prac. 508(d)(1).
9 Minn. R. Gen. Prac. 508(d)(4).
10 Minn. R. Gen. Prac. 510.
11 Id.
12 Minn. R. Gen. Prac. 522.
13 Minn. R. Gen. Prac. 512(c) (emphasis added).
14 Id.
15 An “appeal” of a conciliation court case is really a removal of the claims to district court. Within 20 days of the judgment order from the conciliation court, a party must: serve a demand for removal, file with the court administrator, file an affidavit stating that the removal is in good faith and not to delay, and pay the fee. Minn. Gen. R. Prac. 521.
16 Special Rules for the Pilot Expedited Civil Litigation Track, Rule 1(b)(1).
17 Id.
18 See Nicollet Restoration, Inc. v. Turnham, 486 N.W.2d 753 (Minn. 1992).
19 SPECIAL PROJECT: Self-Help: Extrajudicial Rights, Privileges and Remedies in Contemporary American Society, 37 Vand. L. Rev. 845.
20 Id.
21 FEATURE: ARBITRATION, TRANSPARENCY, AND PRIVATIZATION: Arbitration and Americanization: The Paternalism of Progressive Procedural Reform, 124 Yale L.J. 2940.
22 Id.
23 PUBLIC INTEREST LAW: IMPROVING ACCESS TO JUSTICE:LENA OLIVE SMITH: A MINNESOTA CIVIL RIGHTS PIONEER, 28 Wm. Mitchell L. Rev. 397.
24ARTICLE: POCKETS OF INNOVATION IN MINNESOTA’S ALTERNATIVE DISPUTE RESOLUTION JOURNEY, 33 Wm. Mitchell L. Rev. 441.
25 NOTE: Demystifying ADR Neutral Regulation in Minnesota: The Need for Uniformity and Public Trust in the Twenty-First Century ADR System, 83 Minn. L. Rev. 1839.