Harry Mazadoorian (No Name)
Like so many others, I have not yet been able to score tickets to Broadway’s hottest number, “Hamilton.”
But that’s no problem, as I am happily immersed in reading the superb biography that inspired the musical and caused all the clamor for the tickets. Author Ron Chernow’s New York Times best-selling book is a marvel in many ways. For anyone even remotely interested in the inside story of the drafting of our Constitution, the formation of our political parties, and the greatness and foibles of our iconic early leaders, the book is a home run.
Of course, the complexities and genius of Alexander Hamilton are the engines that drive the entire narrative through Chernow’s spellbinding telling of our country’s early history. I thought I knew a bit about Hamilton when I started the book. I certainly knew that he was the inspiration of our country’s financial structure and that he was an impressive lawyer.
But, even as a champion of alternative dispute resolution myself, I didn’t know that Hamilton was one of our country’s earliest fans of arbitration. Chernow tells us that Hamilton was reported to have preferred arbitration or “amicable settlements” in lieu of litigation, and also recites a number of matters that Hamilton resolved by arbitration, such as shipping disputes.
As arbitration becomes more prominent, controversial and headline-grabbing—particularly in the area of consumer applications—many still continue to think of it as a relatively new “alternative” to our litigation system: Chernow’s masterpiece reminds us that arbitration has deep and respected roots in our country.
Hamilton had a very active legal practice. He is described as “New York’s premier lawyer, with an elite clientele that included the city of Albany and the state of New York.” Chernow reports that Hamilton was involved in important commercial cases and “was a very great favorite with the merchants of New York.” Hamilton, of course, was not alone in his preference for arbitration, as many early practitioners preferred it to litigation. Nor was New York the only jurisdiction in which arbitration was favored: Connecticut was also an early leader in arbitration use. The very first chapter of “The Mediation Practice Book,” for which I had the privilege of serving as editor, is titled “Earliest Uses of ADR in Connecticut: Arbitration Dominates.” As early as 1645, the Connecticut General Court recommended that many “unnecessary tryalls by jury … might be prevented if arbitrations might be attended in a more private way.”
A 1753 act, titled “An Act for the More Easy and Effective Finishing of Controversies by Arbitration,” defined an arbitration process and thus established Connecticut as an early leader in arbitration.
So, too, in 1794: New Haven was the site of one of the earliest Chamber of Commerce arbitration panels for commercial disputes.
Other colonies also saw heavy arbitration use. Jerold Auerbach’s gem, titled “Justice Without Law,” reports that, “by the mid eighteenth century commercial arbitration was favored by merchants for its speed and low cost,” presumably the same reasons Hamilton preferred arbitration. Auerbach also cites other traditional reasons for selecting arbitration over litigation, including the availability of business experts. Moreover, litigation put trade secrets out for public view, disrupted the course of business, and fractured commercial relationships.
Thus, in the early years of our nation, arbitration had reached a high level of utilization, particularly in commercial disputes, and that continued until a time when the ebb and flow of opinions once again pushed litigation to the forefront and created what was perceived as a judicial hostility toward arbitration, particularly by allowing the revocation of agreements to arbitrate. The enactment of the Federal Arbitration Act in 1925 established arbitration agreements as “valid, irrevocable and enforceable.”
So the current debate on the fairness and usefulness of this supposedly “new” emergence of arbitration continues in the state and federal legislatures, and awaits further judicial definition once the ninth U.S. Supreme Court justice is installed. But throughout that debate, it’s useful to remember the history of arbitration, the prominent role it has played in our civil justice system since the days of our country’s founding, and the reasons for its longtime use. Throughout all this time, arbitration has been a pivotal part of how our dispute resolution institutions have developed.
While arbitration is by no means a major thread in the overall fabric of Chernow’s biography of Hamilton, the references to it are of importance and instructive to all ADR practitioners. The fundamental reasons for its heavy utilization at the time of our nation’s formation continue today, particularly in the commercial context.
Even if arbitration isn’t front and center in the musical, I still sign up for the Hamilton lottery whenever I go into the city. And if I ever do get to see the show, I’m sure I’ll be entranced by the musical score and choreography. But I’ll always be thinking of Hamilton, the fan of arbitration.
How ironic it is, in light of Hamilton’s support for arbitration, that the final controversy in his life was resolved by a much more permanent and lethal form of dispute resolution.