Case Summary: Nancy J. Lamarche v. Stephanie A. McCarthy, 2008 N.H. LEXIS 150

Issue: The New Hampshire Supreme Court considered whether a rule requiring payment of a fee by parties subject to court-ordered alternative dispute resolution is constitutional.

Rule: The Court determined that the $50 mandatory fee is constitutional because it is a reasonable method for raising revenue and it does not deprive litigants of access to the court. The Court also ruled that the presence of sanctions for failure to pay the fee (up to and including dismissal of the case) does not affect the constitutionality of the rule. [1]

Facts: Nancy Lamarche and Stephanie McCarthy were plaintiff and defendant respectively in a personal injury matter. The case was referred to mandatory alternative dispute resolution by the trial court. Both plaintiff and defendant objected to the mandatory $50 fee for such a proceeding and the trial court agreed, stating that the required fee was unconstitutional. The New Hampshire Office of Mediation and Arbitration (“OMA”), a legislatively-created body charged with making alternative dispute resolution programs within the state’s judicial branch an efficient, effective and useful part of the court process, intervened, arguing for the fee’s constitutionality. [2]

Discussion: After determining OMA did, in fact, have standing to intervene in the case, the Supreme Court addressed the constitutionality of a mandatory fee for ADR. Plaintiff in this case advanced several theories to the Court supporting the contention that a mandatory fee was unconstitutional.

Her first argument, in the words of the Court, was that imposing a fee for ADR was “tantamount to requiring one to purchase justice.” [3] The Court was unreceptive to this line of reasoning, instead favoring an argument advanced by the State of New Hampshire, as amicus, that the $50 fee for alternative dispute resolution was “akin to a filing or such administrative fee…” and that “[s]uch fees have been found constitutional in this state and others, and should be upheld” (internal citations omitted). [4] Ultimately, the Court ruled that the fee was “a reasonable fixed fee, prescribed for the purpose of revenue.” [5]

Plaintiff also alleges that the fee (or the associated sanctions for failure to pay it) could result in the deprivation of the constitutional right to a jury trial. [6] The Court dismisses this contention on two grounds: First, the third-party neutral to which their case was assigned was not a judge and had no power to make judicial decisions or bind the parties to a course of action. Also, the Court analogizes the case to that of Follansbee v. Plymouth Dist. Ct., 151 N.H. 365, 367 (2004), wherein the Court held that a “thirty dollar fee for a bail assessment did not violate our constitution because an arrestee would receive a hearing regardless of his or her ability to pay immediately…Because imposing a fee to be paid at a future time did not deprive arrestees of their right to bail, it was subject to rational basis review. The same is true in this case.” [7] Since plaintiff was never actually deprived of her right to trial, the Court used a rational basis test and – as noted above – it found the fee being charged appropriate.

Plaintiff’s final argument against the fee’s constitutionality stemmed directly from the possible sanctions for nonpayment. [8] Reiterating its reasoning that the fee was similar to any other court imposed fee, the Court held that “Available sanctions…for a plaintiff’s refusal to pay are broad. Indeed, such sanctions could include dismissal of the case if the trial judge found it appropriate. Dismissal for a plaintiff’s failure to pay a filing or administrative fee, such as the fee in this case, is both reasonable and constitutional.” [9]

Though $50 is a relatively low figure even in small claims court, with this decision the New Hampshire Supreme Court has opened the door to a host of questions involving obligatory fees for court-mandated ADR. Perhaps most pressing among these are at what point the fee becomes unreasonable and the method a court will use to determine whether that threshold has been breached. Given that many litigants are often resistant to court ordered ADR let alone being forced to pay for it, answers to these questions will surely be forthcoming.

[1] Nancy J. Lamarche v. Stephanie A. McCarthy, 2008 N.H. LEXIS 150, at *1.

[2] Id. at *1-*3.

[3] Id. at *12.

[4] Id. at *15.

[5] Id. at *14.

[6] Id. at *13.

[7] Id.

[8] Id. at *12.

[9] Id. at *15.