The rapid growth of commercial arbitration has not been without drawbacks. As counsel have become more sophisticated in dispute process design, arbitrations now often incorporate many elements of a court trial. Litigation constructs such as detailed pleadings, broad-based discovery, provisional relief, dispositive motions and formal rules of evidence are often now a part of arbitration. The inevitable consequence of these changes has been increased expense and delay.
To preserve the benefits of arbitration, it is necessary to address this issue from several perspectives, starting with the arbitration clause. A thoughtful process usually should include a negotiation or mediation step, reasonable limits on the scope of discovery, overall time limits on the arbitration, and the designation of one rather than three arbitrators whenever possible.
Limitations on discovery are crucial. The administering institution selected in the clause, and its rules, will initially define the scope of discovery. The clause may add restrictions or additions to rules-based discovery. The key is to choose a discovery process that is proportionate to the magnitude of the dispute, limit excessive e-discovery and give the arbitrator power to assure a reasonable scope of discovery.
Set specific time limits on arbitration and make sure they are enforced. An outside limit could be specified (for example, one year from the commencement of the arbitration to the issuance of the final award) or the provider’s rules may be relied on where they impose such limits. Care should be taken not to set unreasonable limits, and discretion should be accorded to the arbitrator to vary these limits in exceptional circumstances.
To learn more about reimagining arbitration, please read the full article from Law.com by clicking here.