Upgrade to remove ads
Terms in this set (67)
Kind of an informal trial, procedure is very similar as it is in court
Role of the arbitrators
a.Never address the parties or counsel by their first names, even if you know them
i.Even if it is informal, there still needs to have some formality
b.Some arbitrators "split the baby" sometimes they do not
i.Some split the baby every single time in order to stay on the good side
ii.In order to stay on the good side of both parties
iii.Though this is not the way the arbitration should go
c.Arbitrators should look at the evidence, go by what the evidence shows
i.If the arbitration evidence is 50/50->then split the baby
ii.If the evidence clearly shows that the plaintiff or a party should win, then you decide on how the evidence shoes
iii.You decide it on what the evidence shows
form in which a counsel presents arguments before an impartial 3d party who renders a specific award
party who brings the arbitration
Kind of like the plaintiff but for arbitration
party against whom the statement of claim is filed
They file a respond by filing an answer
if they have a claim against a claimant-->file a counterclaim
The arbitrator can derive from these but DO NOT HAVE TO BE:
The American Arbitration Association
iThe Financial Industry regulatory authority-"FINRA"
1. Handle strictly security disputes
Assigned a case manager
this person runs the case by facilitating communication and scheduling hearings
works for the organization and is responsible for the statement of claim filed
works as a liason between the parties and the arbitrator
May also include more than one arbitrator(usually three) may be appointed and they are referred to as the Panel
like a judgment
is where both parties agree in advance to be bound by the award established by the arbitrator
1.The prevailing party in an arbitration may go to a court to seek to enforce the award if the other party does not agree to act with the award
1.The arbitrators themselves do NOT have the power to enforce the award
2.A non-prevailing party who is dissatisfied with an award may go to a court to seek to vacate the award
1.Again, the court has the power, not the arbitrator
arbitration the parties DO NOT agree in advance to follow the arbitrators award, they are simply getting the arbitrator's opinion on what they should do with the case
i.If the parties later agree with the award then it can become binding arbitration
difference between an arbitration and a mediation
In arbitration, the 3d party neutral has the power to make a decision regarding the outcome
In Mediation, the mediator does NOT have this power, the power to decide rests with the parties only
Which of the parties agree to go to arbitration?
a. Example of the Credit Card Companies and the Arbitration Clause
b. Sometimes you sign an agreement that waives you going to court and that there is a binding arbitration agreement
i. This is happening more and more
ii. Going to court gets too expensive and the parties want to resolve at an affordable price
When do you go to arbitration?
Contract OR parties can agree to go on their own(via submission agreement)
i.Agree to submit the dispute to an administering organization or arbitrator
ii.State that they have Read the administrative rules and then agree to those rules and procedures and agree to be bound by them.
iii.If a Hearing is necessary it will be held at a time and place made by the administering organization.
iv.If parties agree to abide by and perform any award and consent/submit themselves to the jurisdiction of the court, then they enter judgment on the court
What if a party to an arbitration agreement files a lawsuit instead?
In that case, the other party who wants to go to arbitration, they can request the court to STAY the lawsuit and compel the other party to go to the arbitration
Arbitration is favored by the courts and will usually stay and compel following this request
1.Why: the court system is overcrowded, so the courts are happy to get this kind of help
b.If you do not act quickly, you may waive your right to arbitration
Does a person have to be a lawyer to be an arbitrator?
No. that is the benefit to arbitration
i.You can get the expertise of people who really understand the underlying agreement
1.This is not something that the parties can get in the court system where they are stuck with the wisdom of the court
Who is the chair person?
a. The arbitration Panel normally are the ones who agree who the chairpersons will be
i. However, sometimes the admin organization will decide who the chairperson is
b. The chairperson is the one who deals with the case manager if the administrative organization appoints one, or with attorney if there is no case manager
i. Chair person can sustain and overrule objections during the hearing
ii. Chair person also has administrative duties(e.g. reviewing subpoenas)
Objections in arbitration
a. Arbitrators do not want the arbitration to be reversed
b. They want to make sure the arbitration is full and complete
c. Generally rules of evidence are followed but RELAXED
i. If objections are made and presenting certain evidence, chances are the objection will be overruled
1. If that evidence is not admitted, then the party can then object and say they did not get a fair arbitration and can then appeal
d. Most often, arbitrators will overrule the objections in evidence (even if it is a good objection)
i. Even if you know they will overrule the objection, still give the objection(just do not be discouraged if it will be overruled)
Reasons for appeal
i. Misconduct of the arbitrator
1. Very rare
ii. If the court feels the party has NOT had a full and fair hearing
1. Therefore, the arbitrator will permit everything into evidence that the parties present so the parteis cannot raise this argument
a. Because of this arbitrators let everything in, does NOT mean they have to accept all of it. Arbitrators have the right and the authority to give as much weight/credibility to evidence as they want to
What should the arbitrator do after the arbitrator makes the disclosures?
a. First, he should schedule a prehearing conference with the attorneys and suggest that all parties be present at the prehearing conference
i. It can be conducted by telephone(in fact, most are done by telephone)
b. What is the main purpose?
i. To decide upon dates when the arbitration will be held
c. After you set the date, then you set a schedule for discovery
i. Interrogatories, depositions etc.
d. Where is the prehearing conference held?
i. Always should be held at a neutral site
ii. Usually at the arbitrators office
e. Give the short recitation of facts of the case to the arbitrator
f. Clients should be encouraged to sit through the prehearing conference--let them be part of the process
13. When the discovery schedule is agreed to, the documents are usually received and the interrogatories are usually answered before depositions
Should the arbitrator be part of any settlement conferences?
a. Absolutely not--The reason for this, during settlement discussions the parties may discuss matters that the parties do not want the arbitrators to know about
Pro Se parties in Arbitration--this is permitted
one who represents themselves in court or in another proceedings
b. A lot of time pro se parties will come to an arbitration a lot like the come to mediation
i. The arbitrator must warn the pro se party, if the other party has an attorney, that they are at a DISTINCT disadvantage
1. This disadvantage is more distnict in arbitration than in mediation
2. This is because there is a PROCEDURE in the arbitration And if they don't know it the other party's attny will be apt to take advantage of this lack of understanding about the procedure
• A lot of times pro se will be pro se because they cannot afford an attny
• Arbitrator can still advise them to try to find some legal services (e.g. a legal clinic or a volunteer)
• However, the arbitrator can NOT help the pro se
• If they do then the other party will claim that the arbitrator is no longer impartial and will force the arbitrator to recuse themselves
• Really the arbitrator can only tell the pro se the elements that the parties will have to prove/disprove to win their case
d. If they try to help the pro se party, that could be grounds for misconduct
i. Arbitrators have to be very careful, they cannot advise pro se parties about meeting their burden etc.
What should be done prior to the hearing
party should Identify all documents at the hearing, including a witness list expecting to testify and a brief description of the testimony potentially offered. Expert witnesses should be identified as such
a. What about Rebuttal witnesses? No. they are not included on the witness list.
a. It is an order by the court, by the panel and administrative body that orders a person to come as either a witness or bring documents to a hearing.
b. Who prepares a subpoena?
i. The attorney who is calling a witness is the one preparing the witness
c. Who signs the subpoena?
i. The arbitrator usually signs the subpoena
d. Who serves the subpoena?
• Arbitrator's have a lot of power, but they do NOT have the power to enforce the subpoena (like how they don't have the power to enforce/vacate an award), so the COURT must be the one to enforce the subpoena
i. The parties can file a procedure in court if state laws so allow to enforce the subpoena
ii. If the hearings conclude BEFORE the subpoena is enforced, what happens to this evidence?
• They have NOT lost the opportunity to introduce this evidence
• Even after the hearing has concluded, the parties can extend the hearing for a certain period of time to let the document or testimony open to be presented to be heard at a later time if the court enforces the subpoena
• However, the arbitrator should put a time period on this keeping the record open
Attorney Client Privilege
Doctor Patient Privilege
Husband Wife Privilege
Party claims privilege and usually makes a request
Usually private, confidential
Who is permitted to be at an arbitration
i. Parties themselves
c. Parties and arbitrator can agree to have other parties present at the arbitratio
i. Have personal knowledge besides the parties of the dispute
ii. Can be excluded from the arbitration hearing until they testify
iii. Arbitrator can invoke the rule of sequestration, where they are excluded for other testimony beside their own
• Reason is clear: you don't want the other witnesses to hear what the others are saying because it may change their testimony
• If a party testifies and there is a fact witness, does the party have to leave the room according to the rule? No. Parties cannot leave the arbitration and the Rule of Sequestration does not apply to them.
• Parties have a right to be present even if a party is a witness
i. Somebody who does NOT have personal knowledge to the dispute
ii. Person is an expert with a technical background that can address the dispute
iii. Expert witnesses however ARE allowed to stay in the room even if the rule is invoked because they do not have first hand knowledge of the facts, so they need to listen to the facts so they can render an opinion
iv. Can give opinions even though they do not have personal knowledge on the facts but they can give effect to the facts presented
• They should hear the facts
v. The rule does NOT pertain to Expert Witnesses
Should the Arbitrator take notes even if there is a court reporter?
Yes. And It is important to do so
i. It usually takes weeks to produce the transcript and sometimes the award needs to be set in motion and the arbitrator have something to reference
• However, it is equally important that the arbitrator take their notes with them if they leave the room
• This is ALSO true for a mediator (when you get an offer in a mediation you should change the page when you go to a different conference room so the other party doesn't see this)
What happens during arbitration that the respondent fails to appear, does the claimant win by default?
Claimant would have to put on his case and then the arbitrator issues the award
While this is not a default, because no one is arguing the other side, it is often awarded like a default
If the witness is sick at the time of the arbitration, can the witness be heard later?
a. Yes there is such a thing where the witness could be heard out of order and at a later time
• However there is a procedure that must be followed:
• Unless there is an emergency, you can't mess up the procedure of the arbitration hearing
• You will have to wait until the other side is finished before you can introduce this witness
What happens when you have a non english speaking party or witness?
a. The arbitrator must put the interpreter under oath
• The arbitrator does not give the oath, "do you solemnly swear to tell the truth the whole truth and nothing but the truth?"
• Rather, it is more like "Do you solemnly swear or affirm that the interpretation you will give in this deposition will be from English to Spanish/Vietnamese/etc. and from Spanish/Vietnamese/etc. to English to the best of your ability?"
• Then it is the interpreter who swears in the witness--"Do you solemnly swear to tell the truth, the whole truth and nothing but the truth?"
Ex Parte Communication
• Any discussions between an arbitrator and a party when the other party is NOT presence
• It is very important that arbitrator does NOT engage in ex parte communications
• If they do so engage they can be challenged and asked to recuse themselves from the panel
• This is why most arbitrations are handled by an outside arbitration organization
• They appoint a case manager who CAN go between the parties and the arbitrator
• Any being in the hearing room with only one party present may lead to the presumption that an ex parte communication takes place
• Be careful as an arbitrator
What does an arbitrator do if they mess up and engage in an ex parte communication:
• They should immediately stop the communication
• If the communication is truly innocuous then no need to disclose
• However, if it is not innocuous then you MUST disclose it on the record and to the other party
a. IT is a session with ONLY the arbitrators
b. Usually called either by the chairman or other arbitrators
i. When the chairman rules one way, and the arbitrator rules another way, chairman calls the executive session and excuses the other parties
c. In FINRA arbitrations
i. Executive session is ALWAYS called at the beginning of the arbitration so that the chairman can sign the duty
1. One will run a tape recorder
2. Second will be assigned the duties of marking documents that come into evidence
a. Will advise other arbitrators the ultimate questions until the end of the direct and cross examination of the witness
i. If the arbitrator has questions during the testimony that will clear up what the witness said at that time, a witness can ask for clarification.
Arbitrations and Court reporters
All arbitrations have a court reporter present
a. Even arbitrations handled by FINRA
b. If one party wants to have a court reporter there,
c. Both parties must pay for an official record
d. If it is not an official record
a. Used to show the party's intent to prove
b. Not used to show evidence
c. You state what you intend to prove, just like in trial.
32. Can parties send notes back and forth to their attorneys?
a. In court, yes but in arbitration, they cannot if they are a witness/on the witness stand
b. What if one of the parties starts acting up?
i. Arbitrator should tell the attorney to have the party to behave
ii. If it is still persisting, Arbitrator should call a recess and the arbitrator call attorney to have him to stop acting up
iii. If it is still persisting, they won't be thrown out however, they need to realize for their interests it is the arbitrator who makes the decision
c. If somebody other than the party is acting up, then the arbitrator can kick them out of the arbitration
d. Arbitrator can dismiss the case wihtout prejudice
a. Usually the parties will be presenting their case by calling a person to testify
i. They witness will be sworn in by the chairperson and will have to state their name, address and their affiliations
b. Direct Examination occurs
i. After that is finished, then the same witness is now cross examined
c. If the respondent brings up things for explanation, opponent will have the opportunity to redirect examination of the witness and then the respondent will have the
opportunity to recross
Pro se parties as witnesses
a. They do not get the opportunity to ask themselves questions,
b. they give a narrative to the other side can cross examine the pro se
c. then the otherside will have an opportunity re-cross
35. If a witness testimony is interrupted by recess, the witness must be reminded by the arbitrator that they are under oath(they do not have to reswear them in)
36. Easier to maintain decorum than trying to get decorum back when it gets lost
Motion to Dismiss
• After evidence, or before the hearing is introduced the respondent may make a motion to dismiss the evidence/case
• The panel should view the evidence in the light favorable to the claimant
• Even a very overwhelming motion to dismiss may be rejected
• These can only be granted unanimously
• These are rarely granted because the arbitrators Do NOT hear everything they will hear in the arbitration in a motion to dismiss
• They can be valid and may be granted
• One of the reasons they SHOULD be granted is if the SOL has run
• If the case is dismissed with prejudice after the claimant presents their case then an award must STILL be rendered
• The arbitrators will have to decide whether or not to charge fees
Rules of Evidence in Arbitration
• Rules of evidence are relaxed in an arbitration
• The arbitrator will decide how much weight to give things admitted into evidence
• Be sure that all parties are allowed to object to evidence and give their reasons to evidence
• However, many of these objections will be overruled, but they may still listen to the arguments as to why they should not let it in
• However some rules of evidence are followed:
• Relevancy and credibility:
• These are key factors as to whether to admit evidence
• Relevancy: whether evidence can prove or disprove a case
• Credibility: whether or not it the evidence is believable
• Evidence can be relevant but not credible
• This evidence should be admitted, but the arbitrators should give little weight to this
Cutting off in the hearing`
IMPORTANT not to cut off a party during the hearing
• One way to do this, is to see how much time the party will need to present their case
• If a witness/party is continually unavailable, arbitrator may ask for an affidavit of engagement
• After the parties finish presenting their case, each parties will give a closing statements
• Immediately before or after these, the panel should request any additional information they need to reach a decision
• In these closing statements the arbitrators may find they need more information, and they should ask for it then
• This additional information may come in form of written summaries
• After this, the arbitrators can ask the parties to submit a proposed reward
• This will save the arbitrators time and will ensure that the arbitrators do not overlook something that needs to be included in the award
• For legal issues, the arbitrators can ask for the parties to give their briefs on these issues
• Need to set a time and page limit on these briefs however
• Closing statements are STRICTLY for summarizing evidence that has already been presented
• Do NOT use these as a way to introduce additional evidence
• Order for closing statements
• The claimant goes first, then the respondent, then the claimant again in rebuttal
• A savvy attorney in an arbitration does NOT follow this procedure
• Instead, the claimant will waive their closing argument first, and will go second in an attempt to rebut the respondents argument without giving the respondent the chance to rebut this
End of the hearing
• It remains open until the attorneys agree that it is closed
• If there is nothing else that needs to be submitted however it is generally closed immediately following the closing statements
• The panel should tell the parties that the award will be decided and forwarded to them by a certain date
• Typically these need to go to the court within 30 days
Determining an award
• Before determining liability: the panel should rule on outstanding motions that were open
• Then, the panel should have discussions IMMEDIATLEY after the close of the hearing
• The individual arbitrators will give their opinion on how the award should be
• Generally, the most junior arbitrator will go first and the chairperson goes last
• This avoids undue influence on the arbitrators
• However, if highly technical may need technical expert first
Step 1 Determine the facts of teh case--weigh the credibility of the witnesses and the value that you want to get this evidence
step 2 Determine if the facts found above support a finding of liability
Step 3 Determine liability
Factors to determine the credibiltity of the witness
Part of determining the facts of the case
1) Memory of the witness
• A memory of a witness that only remembers helpful facts is typically NOT a credible witness
• More credibility when less selective witnesses
• 2) Past acts of the witness
• If they have a pattern of untruth, give them less credibility
• 3) Incentives to mistake the truth
• A witness who has an interest in the outcome of the arbitration is usually less reliable then a witness without this interest
• 4) Inconsistent statements
• A witness who has made prior statements about SIGNIFICANT events that are inconsistent with the present testimony are often less credible
• 5) Demeanor of the witness
• This will reveal a lot about the witness
• Look at the witnesses EYES
• This will give a lot away about the testimony
• 6) Reasonableness of the testimony
Weigh the credibility of documentary evidence
Part of determining the facts of the case
1) Who prepared the documents
• A third party preparer is likely more credible
• 2) Prepared in normal course of business or for litigation
• Normal course of biz document is more credible
• 3) When was the document prepared?
• If shortly after an event/conversation is given more weight
• 4) Who has custody/control of the document
• The chain of custody and ability to change the document will effect the weight it should be given
Determine if the facts found above support a finding of liability
• If the facts do NOT show liability, then the claimant losses
• Do not mention damages UNTIL AFTER liability has been determined
• After you have determined the facts and applied the law to the facts you will find liability
• In an arbitration there is a difference in applying the law (mandatory rules=diff.)
• However, if the law is CLEAR it should be followed in the arbitrator.
• However, in an ARB. if the relevant law is in doubt you can ask the parties to submit briefs on the law
• Arbitrators are NOT necessarily bound by stare decisis
• Arbitrators Here May be guided by equity and fairness instead of just law
• This decision requires a MAJORITY vote of the arbitrators.
• The claimant has the burden of proof about their claim, and the respondent will only have this about counterclaims
• Liability must be determined by a Preponderance of the evidence
• Most cases involve several claims and each claim should be considered separately
• If the arbitrator believes that the party is liable, then they can discuss damages to award
Benefit of the bargain
• monetary sum required to compensate a party for his or her loss
• Considered as out of pocket losses
• Difference between the value received and the FMV of what would have been received had their not been wrongful conduct
• Some argue that this should include consequential damages, including loss profits, taxes, commissions, or fees
: Damages designed to put the C in the same place they would have been before entering the contract
• Placed at the same place they were before the transaction
• Concept as discourgement
• When a respondent has been enriched in an amount greater than what the plaintiff has suffered
• The theory behind this is that a wrongdoer should not be able to profit from his wrongdoing.
When a R is enriched greater than the out of pocket losses of the C, these damages require the R to get rid of this extra enrichment
• This is designed to make bad actions not profitable
• These may be allowed when the C has not suffered out of profit losses
Benefit of the Bargain
damages seek to give the C the expected value of the profit
• There is a problem with determine the bargain that the C would have received
Damages intended to punish the wrongdoer instead of helping the C
• These can generally be rewarded if and ONLY if the C request these AND the R has committed a severe wrong AND the statute permits for punitive damages
• Conduct allowing for these damages: outrageous, malicious behavior
Designed to make the parties whole as well, but should ONLY be limited to situations where monetary damages would NOT make the party whole
Requires a party to refrain from doing certain things
• The C will typically request this if the damages is immediate and irreversible if continued
When are the arbitrators duties finished?
o When the arbitrator renders the award
• After this arbitrator is released from any other duties attached to the arbitrator
• In addition, after this, the arbitrator should destroy their notes
• This protects the confidentiality of the arbitration and protects against an attempt to subpoena the notes
May the arbitrator discuss their reason for the award with the parties?
NO ABSOLUTELY NOT
If they give their reaon the losing party may find grounds to challenge the award
If a party calls to ask for your reason tell them you cannot discuss with them
What should the arbitrator do with his/her notes?
o After this the notes should be destroyed for confidentiality
o Can he discuss the reasons for his awards with the parties?--Absolutely not. The reason is that the parties may try to seize on something that the arbitrator says
• IF the parties request the award then you can discuss it with that party
Two types of arbitration
• It originated with baseball player between them and the teams. Disagreement over what they should be paid. If they cant reach an agreement the dispute will go to arbitration. The rule here is that the arbitrator can only decide the award based on the final offer and counter offer of the parties, this encourages the parties to be reasonable in their final offer. If they are not reasonable the arbitrator may rule that way
• The arbitrator can award any amount between 0 and what the parties have asked for on the top end. However, the parties can secretly agree between themselves that if the arbitrator does not render an award above a specific point, Or if he gives an award above a specific point then the R will accept the prior agreed amount.
• E.g. the parties make a high point and a low point agreement.
• If the arbitrator gives an award outside of this amount the R will take the closer of the two. If the arbitrator gives an award between these amounts then the parties will accept the award of the arbitrator
A mediation that is held first, and if the case doesn't settle in mediation, then the arbitration will follow immediately afterward (while the parties are still their) and the arbitration will be binding
• Prof. Silverberg will not conduct a med-arb. Because when you conduct mediation, the idea is that the parties will work with the mediator confidentially; however when the parties now that the arbitration will follow if they don't settle, and the arbitrator is the same person as the mediator then the parties will NOT work with the mediator confidentially. They will feel like they cant tell the mediator everything because they fear that it will be used against them in the arbitration
• The only way this really works is if there is a different person for the mediation and the arbitration
The arbitration is discussed first and then the mediation will follow. The arbitration will go first and the arbitrator will render an award, but put this award in an envelope (have the attorney initial the award so they don't fear that you switched it on them), then after the arbitration have mediation.
• It is useful the continue to bring the arbitration award envelope between the mediation sessions to encourage them to agree
• If the parties agree to a settlement in the mediation then the arbitrators award is destroyed; however if the parties do not settle in mediation, then the award is opened and it becomes binding
• You do NOT need two separate people for an arb-med.
• The parties ARE allowed to stop after the arbitration and just accept the award
THIS SET IS OFTEN IN FOLDERS WITH...
Hybrid Processes ADR
YOU MIGHT ALSO LIKE...
Chapter 5: Substantive and Procedural Issues
Civil Procedure 2
Litigation (test 1)