Wednesday, May 24, 2017

Dispute Resolution Alternatives in Latin America

The Cornell University Law School Legal Information Institute defines “Alternative Dispute Resolution” (ADR) as “any method of resolving disputes other than by litigation”. Arbitration and mediation are the two main forms of ADR, although there are others available (e.g. negotiation, early neutral evaluation and conciliation).

ADR methods have been used to solve disputes since ancient times in different societies around the world. In “A History of Alternative Dispute Resolution”, authors Jerome T. Barrett and Joseph P. Barrett propose a timeline starting in 1,800 B.C., when the Mari Kingdom (modern Syria) used mediation and arbitration to resolve disputes with other kingdoms.

However, Professor Michael Moffitt determined ADR’s “Big Bang Moment” to have occurred in 1976, when Harvard Law School Professor Frank Sander delivered his speech at the Pound Conference on “The Causes of Popular Dissatisfaction with the Administration of Justice” in Minneapolis, Minnesota. Prof. Sander’s address, titled “Varieties of Dispute Processing”, suggested that while litigation could be effective in some cases, other types of disputes would be better resolved by different means. He proposed a future scenario where courts could screen complaints to assign the most appropriate form of resolution to each. This was the birth of the multi-door courthouse” concept.

Several years later this ADR Big Bang reached Latin America, with initial legislative reforms incorporating ADR mechanisms -principally mediation- in Colombia (1991), Argentina (1995), Peru (1997), Ecuador, Bolivia, Costa Rica and Honduras (2001), and El Salvador and Paraguay (2002).

Some countries, such as Ecuador or Venezuela, even incorporated references to ADR in their Constitutions. Article 258 of the Venezuelan Constitution provides that “[…] The law shall encourage arbitration, conciliation, mediation and any other alternative means of resolving conflicts”.

In 1999, the Organization of American States (OAS) created CEJA (or “JSCA”, “Justice Studies Center of the Americas”) to “facilitate and promote the process of reform and modernization of the justice systems of the Americas”, which encompasses the topic of ADR.  In April 2014, CEJA issued a report titled “Alternative Mechanisms to Judicial Procedures to Facilitate Access to Justice in Latin America” containing a study of 207 ADR initiatives identified in 19 Latin American countries including Argentina, Bolivia, Brazil, Chile, Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Haiti, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, Dominican Republic, Uruguay and Venezuela. The report states that most ADR initiatives in the subject countries (145 out of 207) worked as part of the judicial system, and only a small minority (21) excluded access to judicial review.

The CEJA report concluded that mediation and conciliation are the two ADR methods most commonly implemented throughout Latin America. While a mediator seeks to assist the parties in communicating and evaluating positions with the objective of having the participants create their own solution to the conflict, a conciliator will go a step further and make tangible agreement proposals for the parties to consider (other countries do not recognize this distinction – in the United States, for example, mediators frequently make proposals to resolve the dispute).

These two ADR methods challenge the notion that the only way to resolve a conflict is by embarking on an adversarial approach, through adjudication. Instead of having one person win and the other lose, mediation and conciliation allow for the interests of both parties to be addressed, opening the possibility of “win-win” solutions.

For insurers and reinsurers in Latin America, the region’s ADR Big Bang has provided additional tools to close files on better terms and for much less cost. Those who wholeheartedly embrace this opportunity may be in the path of reaping tangible benefits by giving preference to these alternatives, assigning the necessary resources to obtain results and being creative.

Published by Daniel Baron*

*Not licensed to practice law in Florida

Wednesday, May 10, 2017

Habla Inglés?

Para ver esta página en Español, por favor haga clic aquí.

English has been called the “global language of business” because of its international significance. In 2014, a group of investigators studied the global influence of languages by looking for connections through translations compiled by UNESCO’s IndexTranslationum project, Wikipedia contributors editing in two languages, and linguistic co-expressions on Twitter. The report concluded that “the world’s languages exhibit a hierarchical structure dominated by a central hub, English, and a halo of intermediate hubs, which include other global languages such as German, French, and Spanish” (“Links that speak: The global language network and its association with global fame”).

Another useful indicator is the level of instruction demand sought from the Berlitz School of Languages. Berlitz reports that the demand for learning English increased by 43% in the period from 1989 to 2009. In comparison, the demand for Spanish instruction only increased by 9.57% in that same period.

The recognition of a common business language begs the question, “is this a benefit to a global business community”? Further, how does the dominance of the English language in business affect a region like Latin America, where most the population are native Spanish speakers? This becomes even more critical in the transaction of insurance related business activities such as negotiating insurance or reinsurance contracts, handling claims, or reporting -where a subset of specialized lexicon comes into play. Are we all really communicating in the same language?

The EF - EPI (Education First - English Proficiency Index) is a study ranking 72 countries and territories based on test data from over 950,000 subjects that took online English tests. The results are ranked by proficiency bands. According to the 2016 results, of the 14 Latin American countries included in the survey, only one (Argentina, ranking 19th) reached the “high proficiency” band, and only one (Dominican Republic, ranking 23rd) reached the “moderate” level. Uruguay (36th), Costa Rica (38th), Brazil (40th), Chile (42nd), Mexico (43rd), Peru (45th) and Ecuador (47th) were placed in the “low” proficiency band; while Colombia (49th), Panama (50th), Guatemala (53rd), Venezuela (60th) and El Salvador (63rd) were assigned to the “very low” band.

These results may be correlated to overall literacy in each of these countries; however, a separate EPI study directed to companies (EF EPI-c) administering tests to individuals amongst various industries in all 72 of these nations rendered similar results.

One can surmise that communication between Spanish and English speakers may not be par. Many may attempt to bridge this gap by introducing an informal translator for verbal and/or written communication. While this may help when conducting business in multiple languages, there are concerns of losing content or context because of translation issues.

It is of course possible to attempt to overcome this problem with the assistance of professional translators, but this is not practical in every case. Additionally, translators are not necessarily equipped with the technical knowledge, specific jargon and industry culture of the insurance world, which creates another problem. As the proliferation of foreign insurance and reinsurance products continues in Latin America, so increases reliance on adjusters, experts, attorneys and other suppliers who have true bi/multi lingual abilities.

As a final consideration, there is no homogenous form of Spanish in the LatAm region. This can also be an issue in communications between Latin Americans. Stay tuned for the second installment of this topic.

Published by Daniel Baron*

*Not licensed to practice in Florida