ALTERNATIVE DISPUTE RESOLUTION
Chapter 1: An Introduction to ADR
*ADR is based largely on the autonomy of the parties
Traditional Private Alternatives to Trial
negotiation
mediation-non-binding, facilitates negotiation, may have substantive expertise or expertise in the mediation process, critical that parties trust the mediator
arbitration-binding
mini-trial-a private presentation of evidence to a neutral expert who is hired to preside over an abbreviated non-binding trial
Court-Annexed Alternatives
court-annexed mediation
early neutral evaluation-these programs assign a 3rd party neutral (usually a trial attorney), the neutral studies the case, meets w/ the parties & makes a pre-trial prediction on the likely outcome that would result from a full trial
judicial mediation
summary jury trial-parties are provided a brief time to present evidence b/f a real jury, the jury renders a verdict that is non-binding but which in theory informs the parties of the probable outcome of the case at a full-blown plenary trial
court-annexed arbitration
rent-a-judge/private judging
Administrative Agency-Annexed Alternatives
regulatory negotiation-joint drafting of an agency regulation by the interested parties
agency-annexed mediation
agency-annexed arbitration
agency convening-agency supplies a neutral to initiate the dispute resolution process, the neutral convenes or starts the procedure of resolving the dispute by consulting w/ the disputants & exploring their dispute resolution desires
Criticisms of ADR
cts may be losing sight of their main event which should be litigation, concern for lack of precedent (Prof. Resnik)
parties may be coerced in to consenting to an alternative, difficulty of not having ongoing judicial involvement, danger of justice being left undone at an alternative, in ct there is an opportunity for justice (they have a public quality & are responsive to the public), cts eradicate the caste structure (ex/ Brown v. Board of Education) & cts move reality closer to our chosen ideals (Prof. Fiss)
BUT can you only achieve a just resolution in ct?
ADR being used to skirt/avoid the law, stifling of development of precedent, some subjects are not proper for ADR such as spousal abuse cases (disagrees w/ broken telephone theory which states that disputes are simply breakdowns in communication), concern for disadvantaged parties (Prof. Edwards)
w/ rent-a-judge, only the wealthier will be able to afford this
HYPO: Seller assures buyer that basement is dry. 1 yr later buyer notices basement has a leak. What are the advantages of these parties using negotiation? privacy, possibly less expensive, quicker resolution, a decision would be chosen & agreed to not imposed upon them, informal procedure, possibly more therapeutic, more flexibility on remedies. Parties have more control over the process. If the parties can’t negotiate this dispute among themselves, they may need a 3rd party (mediator or arbitrator).
Chapter 9: Introduction: The Many Faces of Arbitration
Essential Characteristics of Arbitration
adjudication-more informal than ct trials, but do constitute reasoned presentations of proof by the disputants to the decisionmaker
privacy
informal procedural rules
subordination of substantive law-arbitrators are free to apply legal rules if they desire
finality-parties unhappy w/ the results of an arbitration may attempt to have the result modified or vacated on narrow grounds: clear fraud by the arbitrator, bias or unfairness by the arbitrator, arbitrator has exceeded his authority, or an award is inconsistent w/ public policy
expertise & lack of jury
Subtypes of Arbitration
labor arbitration-(classic model for arbitration, ongoing contractual relationship b/w the parties, parties are seemingly well-balanced) written opinions (some opinions are very limited & just state the amount of the award for trade secret, efficiency, cost-effective, & finality reasons) (not all opinions are published, just those that are hot topics or are unusual fact situations)
Goddard Space Flight Center-NASA electrician, A, was discharged following a guilty plea of possessing cocaine w/ the intent to sell. The union argued that the off-duty offense was unrelated to A’s job. A was not informed in writing of the specific charges against him & was not afforded an opportunity to present a defense on those charges to an unbiased party or tribunal. A was denied substantive & procedural due process. A should be reinstated in his job & receive full back pay & benefits.
Just cause protections either may arise from the common law of the shop (look at other arbitrators’ decisions) or the CBA
commercial arbitration
benefits of arbitration: more friendly way to preserve an established relationship, cheaper, faster, expertise of the arbitrator
popular in the garment & construction industries
can involve parties of unequal bargaining power
international commercial arbitration
permits foreign firms to avoid principles of US substantive law that would be applicable in ct
avoid choice of law battles & avoid hostile home forums
usually require a reasoned, written opinion from arbitrator (offers basis for persuasive precedent BUT not binding)
maritime arbitration
usually require a reasoned, written opinion from arbitrator
securities arbitration
employees who have disputes w/ their employer or customers who have disputes
Natl Assn of Securities Dealers (NASD)=a joint venture of securities sellers that possesses an experienced & professional arbitration dept
i. Under NASD rules, 2 of the 3 arbitrators must be public arbitrators (individuals w/ no ties to the industry) & the 3rd arbitrator is normally a nonlawyer fmr broker
consumer arbitration: arbitration outside the relational contract
Legislation
FAA-primary purpose was to put arbitration agreements on = footing w/ other Ks
Most states have adopted the Uniform Arbitration Act or the Revised Uniform Arbitration Act
Arbitration Procedure
Commonwealth Coatings Corp. v. Continental Casualty Co. (1968)-I: whether elementary requirements of impartiality
er may be express or implied. H: Proceeding b/f a nonarbitral tribunal for the resolution of a contractual dispute is a presumptive waiver of the rt to arbitrate
It is a rebuttable presumption b/c there might be situations where you need to go to ct first (ex/ what does the arbitration agreement cover?)
Arbitration Preemption & the Relevance of State Arbitration Law
§2 of FAA: “A written provision in any maritime transaction or a K evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such K or transaction, or the refusal to perform the whole or any part thereof, or an agreement in writing to submit to arbitration an existing controversy arising out of such a K, transaction, or refusal, shall be valid, irrevocable, & enforceable, save upon such grounds as exist at law or in equity for the revocation of any K”
Southland Corp. v. Keating (1984)-I: whether the CA Franchise Investment Law, which invalidates certain arbitration agreements covered by the FAA, violates the Supremacy Clause & whether arbitration under the FAA is impaired when a class action structure is imposed on the process by the state cts? Natl policy favoring arbitration, states can’t require a judicial forum when the parties have agreed to arbitrate. FAA is substantive & applies in both state & fed ct. Burger notes that the Commerce Clause is the basis of the FAA and extended to interstate commerce. If Congress would have been looking at this as just a forum then Congress would not have used the Commerce Clause
*ct decided that Cong would not have wanted state & fed cts to reach different outcomes about the validity of arbitration in similar cases. The ct concluded that the FAA pre-empts state law & it held that state cts cannot apply state statutes that invalidate arbitration agreements
Dissent: FAA is a strictly procedural act Cong intended to apply only in fed ct
Volt Information Sciences, Inc. v. Board of Trustees of Leland Stanford Junior University (1989)-I: whether application of Cal Civ Proc Code 1281.2(c) to stay arbitration under this K in interstate commerce, in accordance w/ the terms of the arbitration agreement itself, would undermine the goals & policies of the FAA. Here, Stanford had a dispute w/ 3 parties (had an arbitration agreement w/ one & not the others). Rehnquist emphasizes that the parties have chosen this type of arbitration. H: Arbitration stayed pending resolution of related litigation b/w a party to the
