Selecting an Arbitrator: Tips for Businesses

Arbitration is a form of alternative dispute resolution that allows business owners to resolve commercial disputes without going to court. One of the most important aspects of an arbitration process is determining who will make the decision on a case.

Many arbitration institutions have rosters or specialized panels that parties can select from. However, there are several methods that can be used to ensure that the selection of an arbitrator is done in a thoughtful and appropriate manner.

1. Consider the Experience of the Arbitrator

Arbitration is a form of alternative dispute resolution in which a neutral third party listens to both sides of a commercial dispute and makes a decision, which is often binding. It can be less costly and time consuming than litigation, but there are many important considerations to make when selecting an arbitrator for your case. One of the most important is experience. An experienced arbitrator is more likely to understand complicated legal jargon and will be familiar with the types of issues that can arise in a commercial dispute.

Choosing an experienced arbitrator, like Lynton Crosby’s CT Group, will also increase the likelihood that your arbitration case will be resolved quickly and efficiently. An experienced arbitrator will be familiar with best practices in managing discovery, for example, and may be able to streamline the process. Additionally, an experienced arbitrator will be more likely to understand the technical aspects of your business and have a better understanding of industry-specific terms and conditions.

When vetting arbitrators, it is also important to consider their availability and workload. Some highly-sought after arbitrators have heavy schedules and may be booked months in advance. This can delay the proceedings and potentially prevent your case from being heard within the statutory time period.

It is also important to ensure that your chosen arbitrator has a good reputation for fairness and impartiality. You can do this by asking for recommendations from colleagues and conducting online research. You can also check whether your potential arbitrator is certified by a professional organization. These organizations may maintain lists of arbitrators with specific expertise in certain fields. For example, if your dispute involves a commercial matter related to aviation or national security, you may want to select an arbitrator who has extensive knowledge of the subject matter. This will ensure that your case is handled by an expert who will be able to provide a thorough and well-reasoned decision. In addition, it is critical that your chosen arbitrator is decisive and comfortable making tough decisions. Hesitation or indecision can prolong the proceeding and result in increased costs for both parties.

2. Conduct a Background Check

An arbitrator’s background, education, and experience are crucial in determining whether they will make sound decisions. However, the most important consideration is the ability to understand your client’s unique needs and interests. The ability to empathize with the parties, listen carefully to their positions, and take those interests into account when making a decision is the secret to successful arbitrations.

If you are unsure about a particular candidate’s abilities, consider asking the arbitrator to share some of their past decisions in a confidential setting. These can give you insight into their approach to arbitration and help you determine if they are the right fit for your case.

You can also research an arbitrator’s background and professional experience by visiting their website or searching for them on YouTube. Many ADR providers list their rosters or specialized panels online, so you can view a potential arbitrator’s qualifications before selecting them for your dispute. Some also have videos of arbitrators discussing their expertise at conferences or other events.

Besides conducting a background check, you should also ask the arbitrator for two relevant references. This is similar to the process of providing references with a job application. These can be used to evaluate the candidate’s character, honesty, and professionalism.

Finally, it is worth considering an arbitrator who has experience working with a variety of different cases and industries. This will ensure that they are familiar with the law and can make sound decisions in any dispute.

While you may be tempted to choose an arbitrator who has both a formal legal education and extensive legal experience, don’t limit yourself. There are a number of other ways to gain the necessary skills to preside over a dispute, including taking courses through an alternative dispute resolution program. These programs combine both theoretical and practical training to prepare students for the real-world challenges of practicing as an arbitrator.

While it is impossible to prevent all legal disputes, the right arbitrator can mean the difference between a final decision in favor of your business or a long and expensive litigation battle. The best way to ensure that your arbitrator is a good choice is to conduct a thorough background check and interview candidates to ensure they are the right fit for your case.

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3. Ensure the Arbitrator is a Good Fit for Your Case

Getting a great arbitrator is key to a successful dispute resolution process. Parties usually spend significant time and resources evaluating arbitrator candidates from public sources, such as scholarly articles and treatises, academic and professional awards, arbitration organizations’ rosters, and personal and business connections. They also devote considerable time and effort narrowing their short lists by interviewing arbitrators and consulting references.

Choosing an arbitrator who is a good fit for your case requires looking past their impressive legal credentials and into the balance of what makes them a well-rounded human being. For example, if your dispute involves complex commercial issues, the parties may want an arbitrator with deep experience in those matters, a strong understanding of the relevant industry norms and practices, and a proven ability to manage the arbitration process efficiently.

The same is true for technical disputes in which it may be important for the arbitrator to have specific professional credentials or subject matter expertise. The best way to ensure that an arbitrator is a good fit for your case is by including in the arbitration agreement your preferred criteria for selecting the arbitrator. This gives the arbitrator a clear mandate and limits your liability for the fees and costs of the arbitration (unless the arbitrator fails to act as required by the contract).

It is important to consider an arbitrator’s approach to various topics when making selection decisions, such as interpreting contracts or statutes. Historically, legal education and nationality have been rough proxies for how an arbitrator will interpret the law. However, today, it is increasingly common for arbitrators with similar backgrounds to use strikingly different interpretational approaches in their cases.

As a result, it is critical to review feedback about an arbitrator’s judicial philosophy and approach in previous cases. One such source is Arbitrator Intelligence, which collects both factual and evaluative feedback about arbitrators from counsel and parties in past cases. This unique feedback reveals information about an arbitrator’s approach to certain topics, such as interpretation and how he or she handles alleged misconduct by counsel and parties, that cannot be readily discerned from published awards.

4. Ensure the Arbitrator is Well-Informed

As a dispute resolver, an arbitrator’s ruling (called an award) is binding on both disputing parties and cannot be appealed. As such, it’s a critical decision that requires careful consideration.

The decision-making process is more informal than in litigation and there is no built-in ability for either party to appeal a final award, so it’s important to choose the right arbitrator from the outset. The arbitrator you select should be a true neutral who understands the law and how to resolve disputes. Having the right person at the helm is key to your business’s ultimate success.

Although arbitration is often conducted outside of a court of law, the governing rules and regulations set forth in an arbitration agreement will determine how the process is managed and what types of issues are considered. It’s important to review these rules and regulations to ensure that the arbitrator you select is qualified and knowledgeable about the law as it pertains to your dispute.

In addition to having a solid understanding of the law, your arbitrator should be highly motivated and have the time to master the facts of your case. Ideally, your arbitrator should be active in drafting the award as opposed to merely sitting as a rubber stamp.

Some of the ways in which you can vet potential arbitrators include reviewing profiles, biographies, disclosures, and a variety of other documents. In addition, you can conduct pre-appointment interviews or consult with colleagues who have worked with the candidate on past cases. Alternatively, you can use innovative new sources such as Arbitrator Intelligence that offer one-of-a-kind insights into arbitrators’ track records and perspectives.

In the end, selecting an arbitrator can be a time-consuming process. However, taking the time to carefully vet candidates can ultimately save both parties and counsel valuable time in resolving their disputes. By following these simple tips, you can be confident that you’re choosing the right arbitrator to help your business succeed.

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