Many contracts now require the arbitration of disputes instead of allowing for court hearings of claims. Just as important as selecting jurors, lawyers will take care in selecting the arbitrator(s). In many cases, arguing before a sympathetic audience can be the key to winning the case.
The Arbitration Process
During arbitration, a neutral third party (or a panel of arbitrators) is appointed to resolve the business dispute. The number of arbitrators to be selected and the process for selecting them is often set forth in the contract. Much like a judge, an arbitration decision is generally final. While appeal of an arbitration decision is allowed, courts are not going to overturn a decision in arbitration absent a showing of patent material fraud or arbitrator bias or some other defect that renders the arbitration decision so outrageous as to require the court to deviate from the pro-arbitration mandate shown in several decades of United States Supreme Court decisions.
Although business arbitration typically involves the submission of legal briefs and evidentiary hearings with sworn testimony of witnesses, the formal rules of evidence don’t apply (unless the arbitrators say otherwise), and there is often no required discovery process. Rather the parties must only comply with the rules of the particular forum, such as the American Arbitration Association. Overall, arbitration is far less formal and tends to proceed more quickly than business litigation. As a result, it can be usually far less costly than court proceedings, depending on the costs charged by the arbitrators selected and by the forum.
Selecting Arbitrators
Unlike litigation, arbitration allows the parties to have a say in who decides their dispute. Many agreements call for a three-person arbitration panel. Most commonly, each party is authorized to appoint one arbitrator. The arbitrators selected by the parties then appoint a third individual to serve as an arbitrator and chair the panel. Alternatively, the forum provides a list of arbitrators experienced in the type of dispute at issue from which to chose.
Most arbitration tribunals require arbitrators to be independent and impartial. Accordingly, arbitrators may not have personal and/or business relationships with the parties, lawyers, or potential witnesses and must decide the dispute based on the merits of the case rather than any pre-existing bias. However, that does not mean that the parties can’t seek to appoint arbitrators they believe will look favorably on their positions.
With that in mind, lawyers will consider a number of factors when selecting an arbitrator.
Knowledge of the subject matter
Expertise in industry or technology involved
Previous published decisions
Professional background
Published articles and speeches
The personality of the arbitrator can be as important to know as the characteristics listed above. So it is a good idea to ask around to see if someone you know has dealt with the potential arbitrator. Experienced business lawyers often have a list of preferred arbitrators that they have successfully used in the past or those that have solid reputations in the legal community.
Does Your Homeowners Insurance Provide Adequate Coverage?
Your home is likely your greatest asset, which is why it is so important to adequately protect it. Homeowners insurance protects you from the financial costs of unforeseen losses, such as theft, fire, and natural disasters, by helping you rebuild and replace possessions that were lost While the definition of “adequate” coverage depends upon a […]
Understanding the Importance of a Non-Contingent Offer
Making a non-contingent offer can dramatically increase your chances of securing a real estate transaction, particularly in competitive markets like New York City. However, buyers should understand that waiving contingencies, including those related to financing, or appraisals, also comes with significant risks. Determining your best strategy requires careful analysis of the property, the market, and […]
Fred D. Zemel Appointed Chair of Strategic Planning at Scarinci & Hollenbeck, LLC
Business Transactional Attorney Zemel to Spearhead Strategic Initiatives for Continued Growth and Innovation Little Falls, NJ – February 21, 2025 – Scarinci & Hollenbeck, LLC is pleased to announce that Partner Fred D. Zemel has been named Chair of the firm’s Strategic Planning Committee. In this role, Mr. Zemel will lead the committee in identifying, […]
Novation Agreement Process: Step-by-Step Guide for Businesses
Big changes sometimes occur during the life cycle of a contract. Cancelling a contract outright can be bad for your reputation and your bottom line. Businesses need to know how to best address a change in circumstances, while also protecting their legal rights. One option is to transfer the “benefits and the burdens” of a […]
What Is a Trade Secret? Key Elements and Legal Protections Explained
What is a trade secret and why you you protect them? Technology has made trade secret theft even easier and more prevalent. In fact, businesses lose billions of dollars every year due to trade secret theft committed by employees, competitors, and even foreign governments. But what is a trade secret? And how do you protect […]
What Is Title Insurance? Safeguarding Against Title Defects
If you are considering the purchase of a property, you may wonder — what is title insurance, do I need it, and why do I need it? Even seasoned property owners may question if the added expense and extra paperwork is really necessary, especially considering that people and entities insured by title insurance make fewer […]
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Choosing an Arbitrator for Your Business Dispute
Author: Dan Brecher
Selecting an Arbitrator for Your Business Dispute
Many contracts now require the arbitration of disputes instead of allowing for court hearings of claims. Just as important as selecting jurors, lawyers will take care in selecting the arbitrator(s). In many cases, arguing before a sympathetic audience can be the key to winning the case.
The Arbitration Process
During arbitration, a neutral third party (or a panel of arbitrators) is appointed to resolve the business dispute. The number of arbitrators to be selected and the process for selecting them is often set forth in the contract. Much like a judge, an arbitration decision is generally final. While appeal of an arbitration decision is allowed, courts are not going to overturn a decision in arbitration absent a showing of patent material fraud or arbitrator bias or some other defect that renders the arbitration decision so outrageous as to require the court to deviate from the pro-arbitration mandate shown in several decades of United States Supreme Court decisions.
Although business arbitration typically involves the submission of legal briefs and evidentiary hearings with sworn testimony of witnesses, the formal rules of evidence don’t apply (unless the arbitrators say otherwise), and there is often no required discovery process. Rather the parties must only comply with the rules of the particular forum, such as the American Arbitration Association. Overall, arbitration is far less formal and tends to proceed more quickly than business litigation. As a result, it can be usually far less costly than court proceedings, depending on the costs charged by the arbitrators selected and by the forum.
Selecting Arbitrators
Unlike litigation, arbitration allows the parties to have a say in who decides their dispute. Many agreements call for a three-person arbitration panel. Most commonly, each party is authorized to appoint one arbitrator. The arbitrators selected by the parties then appoint a third individual to serve as an arbitrator and chair the panel. Alternatively, the forum provides a list of arbitrators experienced in the type of dispute at issue from which to chose.
Most arbitration tribunals require arbitrators to be independent and impartial. Accordingly, arbitrators may not have personal and/or business relationships with the parties, lawyers, or potential witnesses and must decide the dispute based on the merits of the case rather than any pre-existing bias. However, that does not mean that the parties can’t seek to appoint arbitrators they believe will look favorably on their positions.
With that in mind, lawyers will consider a number of factors when selecting an arbitrator.
Knowledge of the subject matter
Expertise in industry or technology involved
Previous published decisions
Professional background
Published articles and speeches
The personality of the arbitrator can be as important to know as the characteristics listed above. So it is a good idea to ask around to see if someone you know has dealt with the potential arbitrator. Experienced business lawyers often have a list of preferred arbitrators that they have successfully used in the past or those that have solid reputations in the legal community.
Let`s get in touch!
Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!
