By Vincent J. Love

Perhaps the most underutilized benefit available to New York State Society of CPAs members is the alternate dispute resolution (ADR) program headed by the Society’s Mediation and Arbitration Committee.

The committee recently completed a revision of the procedures governing the program after an extended period of review and discussion, and the committee expects member interest in ADR to grow.

The ADR program encompasses mediation and arbitration of disputes between Society members that do not entail disagreements over technical issues. The program is designed to help members resolve disputes without resorting to litigation. Matters typically handled by the ADR program include disputes between a CPA firm and a former partner or employee. Members can use the program when a merger of firms does not work out, or when there is disagreement over the interpretation of a partnership agreement. (The program is not available to resolve disputes between CPAs and their clients or CPAs and non-CPA former employees.)

Partnership or employment agreements with partners or CPA employees can specify that any conflicts will be referred to mediation or subject to binding arbitration under the Society’s ADR programs.

Mediation vs. Arbitration

Mediation is a process where a neutral person facilitates negotiations between conflicting parties. While parties agree to mediation voluntarily, and can withdraw from the process at any time, mediation is highly successful in resolving disputes without recourse to the high cost and significant delays associated with litigation. (To learn more about mediation, read the article “A Practical Guide to Mediation,” by former committee chair Philip A. Zimmerman, scheduled to be published in the January 2003 issue of The CPA Journal.)

Parties in arbitration, on the other hand, agree to submit their dispute to a neutral person for a binding determination, a more formal affair than mediation, though still not as formal or all-consuming as litigation. Generally, courts will not overturn an arbitrator’s award in such procedures, though it is not unusual for a party to seek judicial review. (For more information on arbitration, read the article “A Practical Guide to Arbitration for CPAs,” also by Zimmerman, published in the December 2001 issue of The CPA Journal.)

To learn more about the Society’s mediation and arbitration program, visit the committee’s webpage at www.nysscpa.org/ leadership/listing.cfm?ID=16&App=146.

If you are interested in starting a mediation or arbitration, serving on the committee, or participating in the Society’s ADR program as a qualified neutral, you can contact the author at vlove@kramerandlove.com or (212) 338-0600, or the Society’s legal counsel, James A. Woehlke, at jwoehlke@nysscpa.org or (212) 719-8347.

Vincent J. Love is partner-in-charge of Kramer & Love in Manhattan and is the chairman of the NYSSCPA’s Mediation and Arbitration Committee.