I got to reading some of the contracts to which I am a party today. My cell phone, my credit card, and a number of my online services all require that I take any claims I might have against them to arbitration. Which got me to wondering: what is arbitration like?
Have anyone ever been to arbitration over a legal issue?
What do people think about the fact that so many claims are being shifted out of the legal system and into arbitration?
Do you think arbitration companies have an incentive to rule in favor of corporate defendants, so that these defendants will be more likely to choose those companies?
As an insurance adjuster, we often use arbitration and mediation as alternate ways to resolve claims. My arbitration experiences are completely within the insurance industry so I can’t say that corporate America is getting the upper hand because we’re all corporate. When two insurance companies can’t agree, each insurance company presents the merits of it’s case to an independent third party who reviews each submission and makes a binding decision. The arbitrator is usually a volunteer seasoned adjuster or supervisor of a separate, un-involved company.
Mediation is similar in that both parties present their case to an independent third party, the mediator, who attempts to point out the strengths and weaknesses of both parties so that they can negotiate a resolution. In this case, the plaintiff is usually John Q. Public represented by an attorney vs. the Insurance Company also represented by an attorney. The mediator is also an attorney. Again, I don’t see much bias toward either little John Q or Deep Pockets Insurance Company.
Only in hypothetical moots last year when I was doing the subject Alternative Dispute Resolution for my law degree.
If it gets a reasonably fair remedy more quickly and more cheaply, than it’s great. The official courts love the idea because it helps to reduce the workload for them.
And I agree that your initial choice of IMHO was a better spot for this thread.
Arbitration permits the parties to select the arbiter (judge) and to select the procedure. The question then is do the parties have an equal say in such choices – it wouldn’t be very good if one party picked the judge and picked the rules.
The advantage of industry specific arbitration that Ruby has posted on is that the decision maker is well versed in the particular industry, and the procedure is streamlined specifically for that industry.
For more general arbitration, often the decision makers are retired judges, and the process is very similar or even identical to regular court procedures, so the only big differences are that a hearing can be held much earlier, and the appeal route, if there is one, is different.
Just to be clear, I’m not seeking general information about arbitration. I’m seeking your personal experiences with arbitration, and your opinions on the propriety of having so many commercial cases mandatorily arbitrated.
Ruby, which company chooses the arbiter in your situation? Do you both have to agree?
Yes, twice for insurance. First time (long time ago), I had to show up myself (Geico wouldn’t, the bastards), but the other guy (plaintiff) didn’t show, so judgment for me (expenses).
2nd time a UPS truck backed out into a winding mountain road and I hit it. UPS nearly always fights any claims. This time, my Insurance co (St Farm) represented me, the judgment was 90% his fault, I had to share 10% fault as I did not honk my horn while rounding a mountain curve! St Farm nicely considered that a complete win for us, and re-imbursed me fully.
In our case, there is only one arbitration choice, Arbitration Forums, Inc. They provide volunteer arbiters (experienced adjusters or supervisors) to review the case. So the only thing that we must agree on is that both insurance companies are members of inter-company arbitration. (If one company is not a member, they can voluntarily agree to be bound by the arbiter’s decision) There is no choice of which volunteer gets to review your case.
In the case of mediation, yes, both parties must agree on the individual mediator.