As in litigation, parties and their counsel may seek
to delay the process and impose unnecessary costs
on their adversaries through lack of compliance
with the rules and applicable arbitrator orders, or by
attempting to add new or different claims at a late
date. The newly revised rules clarify the authority of
the arbitrator to control the filing of new claims and to
sanction such conduct. Rule 58 now specifically provides for the availability of issue or claim preclusion
after notice and hearing. This is especially significant in a process that does not provide for appeals.
Similarly, the arbitrator is empowered to allocate
administrative fees, witness and other expenses,
and arbitrator compensation in the award.
USE OF MEDIATION TECHNIQUES
Short of using her authority, an arbitrator can use
some mediation techniques to provide a process
that is more customized to the needs and interests
of the parties.1 Such techniques include:
1. As suggested above, during the preliminary
hearing, inviting input from the parties
in identifying various process issues to
be decided under a “fair and efficient”
standard by the arbitrator.
2. Asking clarifying questions to understand
the parties’ positions and interests, which
shows the arbitrator’s investment in and
commitment to the process and thus
increases the parties’ engagement in and
commitment to the process, and their trust
in the arbitrator.
3. Asking probing questions to reality test the
parties’ positions in the hope of moving
them off their positions, such as this one:
“So, how long will it take if each side, as you
have agreed, takes six depositions?”
4. Using paraphrasing or restatement to
confirm not only the arbitrator’s but also
the parties’ understanding of what has
been said by another party. When parties
are unable to hear what their adversary
has to say, the arbitrator can paraphrase
the statement in a way that will be heard
by all the parties.
Once what the parties really want comes to
the fore after skillful use of the foregoing techniques, the arbitrator can reframe the parties’
demands/interests as a mutual problem. For
example:
“Counsel A, how can we meet your
need to have Mr. Brown testify at
the evidentiary hearing, while at the
same time, Counsel B, recognize that
Mr. Brown’s schedule will not permit
him to attend the hearing on the days
already scheduled?”
When a process issue is presented to parties and their counsel as a mutual problem,
they tend to become problem solvers, leaving behind, momentarily at least, their roles
as adversaries. If parties and their counsel are
given the opportunity to successfully negotiate and come to an agreement with the help
of the arbitrator on procedural issues, they
may be more likely to settle their substantive
dispute.
Lastly, arbitrators can check in with the parties and their counsel from to time to confirm
what they have agreed upon. The more agreements reached, the more likely it is that the
parties will feel optimism in and satisfaction
with the process.
CONCLUSION
Although parties have the freedom to fashion their own arbitration process, there are a
variety of reasons that the clauses they draft
turn out to be less than optimal. The arbitrator
can, and often should, intercede at the preliminary conference to focus the parties on how to
structure the process to ensure that it is fair and
economical.
1While we
suggest the use of
these mediation
techniques with
respect to procedural
issues, arbitration
remains distinct
from mediation in
that the parties are
not final decision-makers, and ex parte
communications
(private caucuses)
are not permitted.
An arbitrator can use some mediation
techniques to provide a process that
is more customized to the needs and
interests of the parties.