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Some seasoned trial lawyers have soured on arbitration as an efficient tool for resolving disputes. From bitter experience they have concluded that it is too expensive, it takes too long, awards are poorly reasoned, arbitrators might not follow the law and no appeal is possible. This negative image is unfortunate and unnecessary. All of the potentially negative features of a poorly administered arbitration are correctable by careful planning and crafting of procedures for each dispute. In resolving complex disputes, a well-organized arbitration process should be more efficient and cost-effective than protracted litigation. Arbitration is purely a creature of the parties’ contract, except for a due process overlay in statutes (e.g., Code of Civil Procedure �1280, et. seq.) and case law. (“Indeed, short of authorizing trial by battle or ordeal or, more doubtfully, by a panel of three monkeys, parties can stipulate to whatever procedures they want to govern the arbitration of their disputes. �” Baravati v. Josephthal, Lyon Ross Inc., 28 F. 3d 701, 709 (7th Cir. 1994).) By agreement before or after a dispute arises, the parties may not only require the dispute to be arbitrated, but may create their own rules, scope of discovery, hearing procedures, standards of decisions and even their own appellate process — to which the arbitrators must adhere if the procedures afford procedural due process and are not unconscionable. An arbitration provision is procedurally invalid if it is based on an inequality of bargaining power or is hidden in an obscure printed document. A provision is unconscionable if it is overly harsh, unduly oppressive or “so one-sided as to shock the conscience” ( Stirlen v. Supercuts Inc., 51 Cal. App. 4th 1519 (1997); Armendariz v. Foundation Health Psychcare Services Inc., 24 Cal. 4th 83 (2000); American Software Inc. v. Ali, 46 Cal. App. 4th 1386 (1996)). DRAFTING A USEFUL ARBITRATION CLAUSE Instead of using boilerplate language that merely requires all disputes to be subject to arbitration administered by a given provider, consider drafting a more detailed clause. Remember also that the parties are free to completely rewrite a pre-dispute arbitration clause that was either poorly drafted or is ill suited to the particular dispute. Think about these questions: Should you use an institutional provider, and if so, which one? Should there be one or three arbitrators? How should arbitrators be selected? Should the arbitrators possess special knowledge or qualifications? How much discovery should occur? Will the law of a particular jurisdiction control? Must the arbitrators rule in accordance with that law instead of general concepts of fairness? Where should the arbitration hearing take place? Should there be a time limit for rendering an award? Without such careful drafting the arbitration will proceed in accordance with the generic rules of the administering organization or the Code of Civil Procedure. PRELIMINARY HEARING, SCHEDULING ORDER AND STATUS CONFERENCES Every arbitration of significant scope should commence with a preliminary hearing, conducted in person or by telephone, with counsel and the arbitrator. The arbitrator should then issue a scheduling order that at a minimum will normally (1) confirm the scope and arbitrability of the issues to be decided and establish the applicable law and rules, (2) provide discovery procedures and deadlines and (3) schedule preliminary motions, pre-hearing submissions and a hearing. If the hearing is set more than three months in the future, the arbitrator should consider holding a status conference every six to eight weeks, normally by telephone, to keep the process on track. DISCOVERY Either the arbitration clause or, more commonly, the scheduling order should delineate the scope and procedures for discovery. This is where counsel’s creativity and the arbitrator’s experience can produce time and cost savings. Answer these questions: What information do you really need to present your case? What information does the arbitrator really need to decide the case? What is the easiest way to get that information? To resolve disputes, convene a conference call with the arbitrator. Using your arbitrator early and often to head off or resolve disputes will always save money. As in federal court, the first discovery tool should be an early comprehensive exchange of relevant document and identification of knowledgeable witnesses. The right to depositions in arbitration is limited. For example, CCP �1283.1(b) does not allow discovery depositions in commercial cases without party agreement, while JAMS’ Comprehensive Rule 17(c) imposes a limit of one deposition in the absence of the arbitrator’s consent. Nonetheless, arbitrators often encounter hearing rooms full of boxes of transcripts to which no one ever refers. Consider foregoing depositions in favor of an exchange of sworn witness statements or witness interviews. If sworn recorded testimony is essential, consider taking depositions by telephone or videoconference. Think about limiting depositions to truly disputed issues, or unknown factual areas — one hour of focused questioning on core issues may accomplish as much as a full day of deposition. Consider asking the arbitrator to impose a limit on the number and length of depositions. Extensive written discovery about the parties’ contentions is rarely useful to the arbitrator. The arbitrator should require counsel to focus any written discovery precisely on an important issue such as damage calculations to which sworn written answers are well suited. PRELIMINARY MOTIONS Arbitrators grant summary adjudications only in the clearest situations. Unless a motion on a legal issue will dispose of a significant part of the case and materially shorten the hearing, an arbitrator is unlikely to grant it. Motions arguing that no material factual disputes exist have even less chance of success. The arbitrator will prefer to decide the issue just as quickly with a more complete factual and legal background at the hearing itself. Save your client’s money by dispensing with long-shot preliminary motions. PRE-HEARING EXCHANGES To streamline the hearing itself, the arbitrator should order the parties to exchange exhibit and witness lists, copies of exhibits that have not already been produced and pre-hearing briefs 10 to 30 days before the hearing. The arbitrator should set a briefing schedule for objections to exhibits, motions in limine and other housekeeping motions. The arbitrator should try to rule on all such motions at the outset of the hearing, thereby clearing the way for efficient taking of testimony. HEARING PROCEDURE Some general words of wisdom are in order here. Get to the point, and don’t repeat it. This isn’t a jury for whom arguments and testimony need to be repeatedly hammered home. Experienced arbitrators are skilled at recalling and understanding evidence. By the time of the hearing they will be familiar with the important facts and legal issues. Ask the arbitrator whether a point has been sufficiently covered — and then move on. Keep asking yourself: What does the arbitrator need to know to decide this case? And then limit your presentation to that core evidence. Almost nothing delays and confuses a hearing more than disorganized exhibits. Counsel should prepare in advance a joint exhibit list without duplications and submit enough exhibit binders, with numbered tabs, for each arbitrator and witness and both attorneys. Counsel should disclose at the outset the tentative order of witnesses and update the schedule every day of the hearing. Remember that arbitrators can read faster than your witness can talk, so it may be more efficient to present some or all of the direct testimony in written form so the arbitrator can read it the night before the witness is cross-examined. This is particularly useful for expert witnesses. Any excerpts from deposition transcripts should be clearly marked and highlighted. Many arbitrators appreciate high-tech wizardry such as PowerPoint presentations, computer animations and the like. Others don’t. Check with your arbitrator first. In complex cases technology can be immensely helpful, but be sure the hearing room is properly equipped. Avoid at all costs a “bad technology day.” Arbitrators have short patience for counsel fumbling with a malfunctioning projector or a frozen computer. Also, remember to preserve the evidence presented in these ways so that the arbitrators may refer to it during their deliberations. Time limits for a hearing, and for each side’s presentation, can promote efficient presentation of evidence. While many arbitrators are appropriately reluctant to impose time limits unless the parties agree, counsel should consider whether some realistic limits will improve their presentations. Some arbitrators insist on post-hearing briefs. Others rely only on oral argument. Most will do whatever counsel want. However, do not assume that post-hearing briefing will help your cause. The delay that is caused by the time needed to prepare and read briefs also impairs the arbitrator’s memory of the evidence. It may be equally effective to dispense with briefs in favor of oral argument held a day or two after the hearing concludes. AWARDS Experienced arbitrators generally prefer to render a reasoned award that explains the factual and legal bases for their decision. However, the parties may require the arbitrator to issue a naked award that merely states which side won and the amount of any damages. PRIVATE APPEAL Although parties in California cannot agree to expand the limited scope of judicial review of an arbitration award, the parties can agree that the award may be reviewed for errors of fact or law by an individual or a panel such as a named group of retired judges. Such an appeal may be arranged through a provider that offers such services or purely privately. The availability of such a second look may increase the parties’ comfort with the award. If lawyers utilize some of these techniques, adapted, of course, to the contours of a particular case, the disputing parties are more likely to realize the benefits of arbitration. Keep in mind that there are many complex nuances in arbitration law and procedures. Further research about specific stages of the arbitration process should be conducted in order to deliver to your client the most efficient and effective dispute resolution. Martin Quinn is a San Francisco-based arbitrator and mediator at JAMS, where he specializes in complex business and tort cases. He also teaches alternative dispute resolution as an adjunct professor at Hastings College of the Law.

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