Corrections or additions?
This article by Bart Jackson was prepared for the March 21, 2001
edition of U.S. 1 Newspaper. All rights reserved.
Quick & Simple Justice: Mediation, Arbitration
Last year more than 198,000 businesses sought mediation
and binding arbitration as a cheaper, swifter and infinitely less
complex solution to contract conflicts than courts of law, with their
long-robed judges and legendary delays.
And, as with any settlement process, victory often lights on the
shoulder
of the most knowledgeable. To help managers understand the process,
professional arbitrator Kenneth Horowitz will conduct his two-part
course “Introduction to Commercial Arbitration for Small
Business.”
Sponsored by Mercer County Community College, the course will be held
Wednesday and Thursday, March 21 and 22, at 7:10 p.m. on the West
Windsor campus. Cost: $40. Call 609-586-9446.
For the past 10 years, Horowitz has joined the 11,000 professional
members of the American Arbitration Association (AAA) to fill an
exponentially
growing need. “Our case load has doubled just in the last two
years alone,” notes AAA’s communication director Alexis
Levenson.
“And we expect a continued rise in requests.” Those interested
in using the services of AAA or learning more about them — or
even becoming an arbitrator — can contact the AAA’s New Jersey
office in Somerset at 732-560-9560; or the corporate headquarters
at 212-716-3976 (www.ADR.org)
The AAA seeks a broad scope of members who can bring their specific
business expertise to disputes either singly or as part of a
three-person
panel. After majoring in business at Fairleigh Dickinson University,
Horowitz, who lives in Manalapan, spent several years at Arthur
Andersen,
and then joined Cott Printing Corporation, where he was responsible
for labor negotiations.
“The advantages of working through binding arbitration are
many,”
says Horowitz, “which is why more and more contracts include a
`disputation settlement by arbitration’ clause.”
Thrift. Compared to the courtroom, arbitration is anincrediblycheap arena. Usually cost are limited to renting a small office,administrativecosts, and the $500 to $1,000 per day for the arbitrator. If it isa complex case, the case may need a three-person arbitration panel.Almost never do arbitration cases demand a recorder, though one partymay hire one and split the cost with its opponent or, on rareoccasions,shoulder it alone. “Interestingly,” says Horowitz, “thesecosts may prove higher than actual court costs on an actual per diembasis. But just wait until the attorneys arrive.”Lawyers charge by the hour, and substantial time must be spent oncommon litigation tasks, including motion preparation, evidencediscoverytime, depositions, document production, preparation of speeches, andof course the longer days at trial. While counsel may — or not— accompany disputing parties into arbitration, they appear simplyto aid in argument presentation.Swift Solutions. “Arbitration is quick,” saysHorowitz. “A really long case may drag on for a month. In court,a decision could take years — then face appeal.” Onefascinatingreason for the speed of arbitration is the attitude of the disputingparties. Typically both parties, along with the arbitrator, areseekingcompromise, not victory. Both the supplier and his shipper, forexample,want to get the goods back on the road; this is where they intendto make their money, not through a legal judgment.”This is not to say that the arbitrator does not make judgmentswhich declare a winner and a loser,” Horowitz hastens to pointout. “We are not mediators trying to negotiate a workablesettlementthat both parties agree to.”Help from the arbitrator, in a relaxed atmosphere. Thecourtroom, by design, is adversarial; the judge aloof. Arbitrationproceeds with ties loosened through three basic steps: openingstatements,presentation of facts, and the summary statements. If one party bringsforth 100 invoices, each with the same complaint, most likely thearbitrator will unite both parties, and get them to distill them allinto a single complaint. No official rules of evidence apply. Thearbitration panel may recommend to both parties a swifter, moreorganizedmethod of argument presentation. Any agreed-upon means that leadsa fair decision is considered justifiable.”There’s no, well, sleazeballs at these hearings,” notesHorowitz.Those who seek to con a quick victory usually head for the court room.In all his years hearing cases, he has never been offered a bribe.Of course, some of the battles do get downright nasty. “You walkinto a room,” Horowitz smiles “and you see a mother anddaughtersnarling at each other across the table in a partnership dispute .. . you just say to yourself `boy, this can’t get good.’”For that reason, arbitrators must remain as Caesar’s wife and keepall extraneous conversation to a minimum. Horowitz even avoids suchcomments as “Say, how about those Thunders?” for fear of evenappearing partial.If you find yourself facing arbitration, or considering anarbitrationclause in your contract, your best bet is to contact AAA and visita hearing. Get the feel, determine the need for counsel, and considerpotential ways of arguing a case. Horowitz adds one tip for managerssteeped in this multi-media age: Don’t go wild with presentation.Power point slides may impress the marketing boys, “but by inlarge,” he laughs, “we strongly prefer content over form.”Also, be aware that arbitration is totally final and binding, andit uses the same muscle of enforcement as do the courts. While appealis technically possible, Horowitz has never seen a decisionoverturned.”I suppose if the panel were incoherent and visibly drooling ontheir decision papers, the verdict could be set aside,” he says.But it just doesn’t happen. While even a superior court judge canhave his ruling appealed if a mistake of fact can be proven, thearbitratoris not so subject to review.Too often we hear resurrected the tired and quivering maxim, “thegovernment should run itself like business.” Perhaps the dilemmawith our courts’ system is that it indeed does — embodying allthe sluggishness, politics and human error found in both fields. Yetmaybe the middle ground of alternative dispute resolution (mediationand arbitration) can bring us a little closer to the swift and simplevision that the aged maxim had in mind. And this might make business,with all its inherent problems, run a little smoother for all of us.— Bart JacksonNext StoryCorrections or additions?This page is published by PrincetonInfo.com— the web site for U.S. 1 Newspaper in Princeton, New Jersey.
