excerpted from BASIC SKILLS FOR THE NEW ARBITRATOR
by Allan H. Goodman
© Allan H.
Goodman All Rights Reserved
an alternative to resolving disputes in court. The arbitration process
allows the parties to select an individual or several individuals with
expertise in the subject matter of the dispute to listen to the
evidence and render a binding decision.
After ten years
as a practicing attorney, I yearned for an opportunity to actually
decide a case rather than advocating the position of one of the
parties. Serving as an arbitrator allowed me to fulfill my desire to
resolve disputes. Since my first appointment as an arbitrator, I have
served in many cases administered through various arbitration
organizations. In these instances, I have had the benefit of rules and
procedures previously established by the administering organizations. I
also have served as an arbitrator for cases administered by the parties
themselves, during which I have had to devise my own procedures and
methods for resolving the matter in dispute.
While there are
many published court decisions which deal with legal issues arising
from arbitration, I have found that these decisions offer little
guidance to the arbitrator as to how to conduct an arbitration. The
practical guidance that I have received has come from fellow
arbitrators and personnel from the various arbitration organizations
with whom I have worked. Over the years, I learned by doing and
consulting with other arbitrators. I followed my instincts, reacted to
situations, and refined my techniques. As an arbitrator, I have found a
great deal of personal satisfaction in dispute resolution.
suggests answers to one hundred questions a new arbitrator might ask
concerning the arbitration process and the role of the arbitrator. It
is not meant to instruct attorneys how to represent clients in
arbitration, nor does it contain instruction for serving as a mediator,
which is a different technique for resolving disputes. Please note that
Question No. 101 is your question to ask me. I invite the reader to ask
me any question that I have not addressed. I also welcome any other
suggestions or comments.
THE MYTH AND
REALITY OF ARBITRATION
The King gave
the order, "Fetch me a sword". A sword was brought before the King and
the King said, "Cut the live child in two, and give half to one and
half to the other." I Kings 3:24-25.
There is a myth
about arbitration. As an attorney, I heard it from clients and fellow
attorneys. Not until I rendered my first arbitration award did I have
personal experience that the myth was probably not true. Yet, the myth
persists, usually in the following form: Arbitration? That's when you
don't go to court, but pick somebody to decide the case informally, and
you go and discuss it with the arbitrator and the arbitrator will
usually "split the baby" - you know, give you at least half of what you
ask for. This myth is not only factually inaccurate as it applies to
arbitration today, but it is historically inaccurate as to the original
dispute to which it refers.
The story of
King Solomon's first arbitration does not support the arbitration myth.
Let us first consider testimony of the witnesses in the original "split
the baby" incident.
Two women came
before the King. The first woman said "This woman and I live in the
same house. I gave birth to a child and she gave birth to a child.
During the night, her child died. She arose in the night and took my
child, and laid her dead child on me. When I awoke to nurse my child,
he was dead, but when I looked at him closely he was not my child." The
other woman spoke. "No, the live one is my son, and the dead one is
yours." But the first insisted, "No the dead boy is yours; mine is the
live one." And they went on arguing before the King.
At this point,
King Solomon rendered an interim award. "Fetch me a sword".
A sword was
brought before the King and the King said, "Cut the live child in two,
and give half to one and half to the other." In response, one of the
parties requested modification of the award. But one of the women
pleaded with the King, "Give the live child to her, only do not kill
it." The other insisted, "It shall be neither yours nor mine, cut it in
Faced with this
additional testimony, King Solomon modified his award.
Then the King
spoke, "Give the live child to the one who pleaded for its life - and
do not put it to death; she is its mother."
It is important
to note what King Solomon did not do. He did not split the baby! What
then is the reality of arbitration? From the arbitrator's perspective,
my personal experience is that in rendering an arbitration award, I do
not "split the baby." In fact, I have never been tempted to do so. The
parties are not looking for a simplistic 50%-50% compromise solution,
or else they would have settled the matter themselves. If they do wish
to compromise, they still may do so at any time after arbitration is
initiated. In most instances, I have either granted a claim in full, or
almost in full, or denied a claim in its entirety. Generally, in
commercial disputes, if a party is correct in its position, and meets
its burden of proof, it will prevail. If it is not correct in its
position, or fails to meet its burden of proof, it will not prevail. In
claims that consist of various smaller claims, some are granted and
some are not. If the claim is not supportable, I deny it. I do not
reward a claimant half of its claim for just "spending the time".
The reality of
arbitration from the parties' perspective is that the parties will
always know more about the dispute than an arbitrator ever will. They
have lived with the situation until it evolved into a dispute. Even
when the time arrives to make an award, the arbitrator may still know
less than the parties know. In any situation involving advocacy, the
trier of fact is left with the "spin" that the parties place on the
facts. Even so, if the arbitrator has performed the duties of the
position well, and taken appropriate steps to control the process so
that the necessary information is submitted by the parties, the
arbitrator can arrive at a reasoned, supportable decision. Your
function as an arbitrator is not to give a party to the arbitration an
"A" for effort, nor an "A" for anger and indignation. Your compassion
for the situations presented to you must be tempered with objectivity.
Your responsibility is to render an award based on the evidence. You
may recall that when Solomon became king, he realized the difficulty of
the decisions he would be required to make. His fervent prayer was for
an "understanding heart."