Except in “bet the company” circumstances, extensive discovery, dispositive motions, expert reports, and hearing costs are making courthouse litigation cost prohibitive.
While arbitrations should bring quicker, cheaper, more thoughtful resolutions, some are as prolonged, expensive and unsatisfactory as the courthouse process they are supposed to improve.
Wise arbitration choices can make a huge difference.
Here are 10 tips that can up the odds your clients will be happier after you arbitrate on their behalf.
- Choose an arbitrator who’s efficient, as well as knowledgeable. Prospective arbitrator interviews usually focus on subject matter experience. Make efficiency, a firm hand, and process streamlining techniques equally important in selecting your arbitrator.
- Involve in-house counsel in the initial procedural hearing. It sets the tone, and often the parameters, for the rest of the arbitration. It gives the clients who foot the bill more effective participation in determining the balance between cost-effectiveness and a fully comprehensive process.
- Limit discovery, especially depositions. Discovery is a major cost driver in arbitration. Both JAMS and AAA rules provide for limited depositions, yet parties often propose more. Selecting an arbitrator inclined toward efficiency and resistant even to joint proposals for more depositions provides some protection. Better yet, evaluate how to present your case through the fewest possible depositions. Then propose reasonable limits.
- Limit, or eliminate, dispositive motions. Arbitration summary disposition motions are rarely granted; often key issues of material fact remain. Also, award vacature can result from failing to allow parties to present their cases. Nonetheless, dispositive motions are often offered. Efficiency-oriented arbitrators can require a letter requesting leave to file dispositive motions before allowing them. You can seize the initiative (and reduce client expense) by proposing a joint request to prohibit or limit dispositive motions.
- Stipulate chronologies and undisputed facts. Much arbitration time is wasted establishing facts not in dispute. Attorneys can save client cost, time, and frustration by asking the arbitrator to require stipulations of the basic factual chronology and all facts not reasonably in dispute.
- Limit admissibility challenges. Arbitrators weigh evidence wisely “for what it’s worth.” Typical courtroom objections and ruling on them prolong arbitration hearings unnecessarily. Efficiency-oriented arbitrators limit objections, keeping the focus on what is key to the merits. And limiting objections can help client hearing attendees feel their time better spent.
- Consider presenting direct testimony in writing. Testimony (especially expert) submitted in advance is commonplace in Europe and international arbitration. While it can be important to introduce a witness and establish credibility, limiting direct testimony can shorten a hearing considerably and focus the arbitrator attention on what’s really in dispute.
- Do not argue every contention. Creative minds conjure myriad contentions. While “throwing everything against the wall to see what sticks” might be tempting, weak arguments hurt you in the long run. If your arbitrator concludes you’ll argue any point, regardless of merit, you’ve squandered valuable credibility and face an uphill climb on issues that matter. Don’t waste time–and hurt your reputation–espousing long-shot positions.
- Request a limited-length award. Consider in advance what your clients might require to understand why an award is entered against them. A joint request to limit the award to X pages can shorten arbitrator deliberation, reduce cost, and bring a quicker result--while eliminating the arbitrator’s opportunity to author The Definitive Magnum Opus at your client’s expense.
- Be vigilant in prevailing-party-attorney-fees circumstances. Prudence dictates arbitrating as if your client could be determined the NON-prevailing party. Although you may believe that “they will have to pay our expenses anyway,” this attitude can escalate costs and risks disastrous results and very unhappy clients.
Two possible reasons to disregard these suggestions are if your clients feel compelled to present the most-exhaustive case possible, or if they require a definitive award to know that every argument was considered thoroughly.
Ultimately, clients have the right to decide whether these factors are more important to them than efficiency and cost savings. Yet, isn’t it wiser to present them with alternatives and have them make the decision?
Client post-arbitration satisfaction can come from many things. Undoubtedly, winning is one. Understanding the ruling (for better or worse) is another. Also, feeling that the process was business-like, cost-sensitive, efficient, and focused on the heart of the dispute can be major.
These suggestions can contribute to client satisfaction after your arbitration. And win or lose, client satisfaction is what builds your successful practice.