The new Coronavirus has created a myriad of business challenges in literally every aspect of the professional community. The legal profession is no exception. For litigators, it has been particularly difficult, as the courts’ temporary closures, and then tentative startups, have caused significant delays, uncertain timelines and a backlog of cases. No one is sure when bench or jury trials will recommence. These delays have given litigants additional incentives to consider alternative dispute resolution mechanisms such as mediation or arbitration. Here’s how arbitration can be a huge benefit to trial lawyers, clients and the courts.
Arbitration can be a great alternative to jury or bench trials for a variety of reasons, including:
• Speed and Cost. Court actions typically take more than a year to reach trial, and that was before COVID-19. Even for cases that settle before trial, settlement often does not occur until after lengthy discovery and trial preparation. Arbitration provides the parties with the flexibility to side-step the lengthy procedural requirements of litigation. The parties may determine the timeframe for the arbitration, allowing them to bypass delays inherent in litigation. Appeals, which can cause litigation to drag on for much longer periods of time, are generally not an option in arbitration, unless the arbitrator’s actions are found to be arbitrary and capricious - a highly deferential standard of review that is difficult to overcome. As a result, disputes may be resolved by arbitration in a much shorter period of time, saving the parties significant time and money.
• Choice of Neutral. The parties can select an appropriate arbitrator (e.g., an experienced retired judge) who has familiarity with the relevant issues in the case, rather than “rolling the dice” with an individual assigned by the court system who may not have expertise in the subject matter of the dispute.
• Flexibility, Limited Discovery and Relaxed Rules of Evidence. Arbitration permits the parties to streamline discovery and allows the arbitrator to easily resolve any discovery disputes. The rules of evidence can also be relaxed allowing the parties more latitude in presenting their case.
• Confidentiality. Arbitration proceedings can be held in private and kept confidential allowing the parties to avoid having sensitive information disclosed to the public, as distinct from litigation.
• No Runaway Juries. Juries sometimes make decisions based on emotion or based on other factors outside the letter of the law; such an outcome is much less likely in arbitrations overseen by an unbiased professional who is well versed in the issues.
• Conducting Hearings in Compliance with COVID-19 Restrictions. Parties may tailor their arbitration to provide that all hearings take place using on-line technology platforms. Alternatively, time and money spent conducting a hearing could be reduced or eliminated if the parties permit the arbitrator to decide some or all of the issues on papers. As COVID-19 restrictions become less restrictive, in-person hearings could be held in conference rooms conducive to arbitrations and designed to comply with applicable social distancing guidelines.
• Customization of Issues. The parties can agree to arbitrate a specific substantive issue within a larger dispute, such as a threshold or discrete issue, with the remaining dispute to be determined by a court. Resolution of an initial, threshold issue could ultimately break up a log jam in a court action and may lead to a settlement.
• Customization of Remedies. The parties may specify the types of remedies that the arbitrator may grant, including damages, specific performance, injunctions and other equitable remedies.
Arbitration provides litigants with an accessible alternative to resolve disputes privately in a timely and cost effective manner. In the wake of COVID-19 and the additional delays imposed on an already congested court system, parties should consider whether arbitration would present a better option for moving their cases forward.
The alternative is to wait things out. Litigation costs will continue to rise as cases are moved at an irregular pace, at best. That would be unfair to litigants and place added pressure on the court system. At Rosenbaum Mediations, PLLC, I have the necessary experience to arbitrate cases of any size and complexity. I have published numerous decisions and have been known for getting matters resolved in a very timely manner. I have handled hundreds of bench trials and settled thousands of cases. Of course, mediation is always an attractive alternative, should the parties wish to attempt settlement first (for more information, see my article "On-line Mediations: Wired for Success" here). But in the meantime, arbitration can significantly cut down on wait times and costs, and allow cases to move along at a better, rapid pace.
~ Hon. Matthew Rosenbaum (ret.), is a retired NYS Supreme Court Justice and founder of Rosenbaum Mediations, PLLC. He has resolved thousands of cases, both small and highly complex. For more information, go to www.RosenbaumMediations.com.
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