August 2012 Bar Bulletin
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August 2012 Bar Bulletin

Recent Washington Cases Affecting Arbitration

By James Verellen

 

(First of two parts)

Modern arbitration has roots in Roman Law: "Compromissum ad similitudinem iudiciorum redigitur et ad finiendas lites pertinet." Translation: "Arbitration resembles an action at law and is intended to end litigation."1

Just in case you have not been keeping score, appellate court decisions in 2011 and the first half of 2012 shed considerable light on a variety of commercial and consumer arbitration issues. The significance of these developments comes more clearly into focus when viewed against the backdrop of contemporary challenges facing arbitration.2 The recent decisions will be reviewed in two segments: here, the limited judicial review of arbitration decisions; Part II, federal preemption, unconscionability and who decides challenges to arbitration.

Speedy and economical dispute resolution

Two core goals of arbitration are to resolve disputes more quickly and less expensively than in the courtroom. Critics argue that these goals are frustrated largely because expansive discovery and extensive motion practice have been imported into arbitration.3 Some complex disputes may warrant three-arbitrator panels with full-blown, litigation-style discovery and motion practice, but most disputes do not require or benefit from such elaborate procedures.

One key to economical and efficient arbitration is to recognize that one-size-fits-all arbitration rules allow flexibility, but also risk expanded discovery and motion practice.4 The drafters of dispute resolution provisions have the opportunity to make thoughtful choices to help control cost and avoid inefficiency.

For example, a stepped alternative dispute resolution provision might require negotiation first, mediation second and arbitration only as a final resort. This approach combined with firm arbitration deadlines, narrow discovery and limited motion practice promotes a prompt and economical process.5 Of course, the selection of an arbitrator with strong case management skills is also a key consideration.

Binding resolution; limited judicial review


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