Local Church Process
(Binding Arbitration - NAD Policy B-90)

Purpose
The North American Division Conciliation and Dispute Resolution Procedures were developed in order to provide a method whereby the church may resolve disputes between local church members; lay members and various church leaders; employees and church employers; church organizations (service organizations, departments, associations, etc.); and/or conferences and/or institutions.

Unless specifically adopted by the employing organization, these procedures are not intended to apply to any church employer/employee relationship nor are they intended to supersede any employer/employee grievance or currently available dispute resolution procedures.

1. Informal Negotiation -- The parties in dispute must voluntarily meet with one another in order to resolve their differences and become reconciled (Matt. 18:15). A pastor or other spiritual counselor may prompt the parties to meet for this purpose.
   
   Adequate time for spiritual preparation should be allowed in order for the Holy Spirit to work in the hearts of the parties in dispute. The disputing parties must begin the conciliation and dispute resolution process with informal negotiation.
2. Mediation -- If the informal negotiation does not suffice, the parties in dispute must voluntarily meet together with one or more mediators. The mediator(s) serve(s) as facilitator(s) to guide the negotiation as the parties seek to agree and become reconciled (Matt. 18:16).
   
3. Binding Arbitration -- Before the process of binding arbitration can begin, all pending law suits related to the dispute must be dismissed, and/or the parties involved must sign an agreement not to institute a law suit against each other.
   

Jurisdiction

LOCAL CHURCH DISPUTES

1. It is the expectation of the North American Division that all grievances be resolved at the level where they arose. The local church, therefore, has jurisdiction in local church disputes that do not affect the employment of persons hired by a conference, a conference institution, or the division.
   
2. In disputes between lay members belonging to different SDA churches, unless otherwise agreed to by all parties involved, jurisdiction shall be with the church of the member whom the claim is against.

Exemptions
The Conciliation and Dispute Resolution Procedures may not apply in situations which are deemed to be outside the jurisdiction of the Church or for which the Church agrees that it has no adequate process for orderly settlement. Examples of cases that are not covered by these procedures may include but are not limited to:

1. Settlement of insurance or self-insurance claims in excess of $50,000 or where the General Conference Adventist Risk Management service has no claims management authority.
2. Issuance of decrees affecting the boundaries and ownership of real property.
3. Marital differences.
4. Awarding custody of minor children.
5. Deciding matters involving the administration of estates.
6. Debt collection matters.
7. Individual disputes with any branch of civil government or law enforcement agencies.
8. Specific theological questions.
9. Questions regarding church discipline and the transfer or reinstatement of membership. (Covered by Church Manual policies.)
10. Church elections.

Initiation Process
The following steps must be taken to initiate the Conciliation and Dispute Resolution Procedures at the Local Church level.

1. The grievant(s) shall make a written request for binding arbitration to the local church pastor or church board.
2. Normally, within 15 working days of the receipt of the request, the pastor or church board shall respond to the grievant(s) with a written acknowledgement and statement as to how and when the request will be processed. Arbitration forms shall be enclosed for the grievant(s) to complete and return to the pastor or board as soon as possible.
3. After the initiation forms have been signed and returned, the following steps are taken by the pastor/church board, to whom the appeal for binding arbitration is made.
   
   1. Present the request and initiation forms to the local conference secretary for appropriate action. (Covered by Church Manual policies.)
   2. In collaboration with the parties in dispute, the conference secretary shall develop the arbitration agreement, select the arbitrator(s), and set the date, time, and place for the arbitration hearing. The hearing should normally consume one day or less.
   3. A Facilitator's Guide containing all the forms required for the process will be sent to the parties in dispute by the local conference secretary. (Forms are also available in the NAD Office of Human Relations.)

The Arbitrator(s)

1. Must be credible, neutral, impartial, and independent.
2. Must be church members in good standing.
3. Must be representative of the membership served.

The Panel

1. May consist of either one or three persons.
2. Must be selected by each party with both panelists selecting the third person who will serve as moderator.
3. Must be agreed upon by all parties in dispute.

Representation

1. Legal representation is discouraged unless both parties agree, and the attorneys are present to provide expert counsel on specific legal matters.
2. A peer may be permitted to accompany a party and speak in his/her behalf in dispute upon prior agreement by all parties.
3. With the consent of all parties, an observer from the next higher level may be invited to ensure that the hearing is conducted in keeping with policy and agreements and to answer questions asked by either the arbitrator or the parties in dispute.
4. Witnesses may appear in an arbitration hearing at the call of the moderator. They are present only to testify and must leave when their testimony is completed.

Financial Arrangements

1. Parties in dispute pay all costs for themselves and witnesses they invite.
2. Parties in dispute pay on a 50-50 basis travel expenses of lay or retired persons who serve as arbitrators.
3. Local conferences pay the travel expenses for their employees who are arbitrators.
4. The union conference and the division pay the travel expenses for their observer(s) and arbitrator(s).
5. Incidental expenses incurred by the arbitrators are paid by the entity that appointed them.

Other

1. Formal transcripts and recordings are permissible in arbitration hearings.
2. Arbitrators and observers shall commit themselves to strict confidentiality and shall disclose all real or potential conflicts of interest. When such are disclosed, the person(s) involved shall be replaced.

Issued January 1, 1999