FREDERIC CANN ARBITRATION		Contact the Arbitrator e-mail: fec@cannlawyersusa.com
27th Floor, Wells Fargo Tower 1300 SW Fifth Avenue Portland, Oregon   97201-5617  USA	Phone: 503-226-6529 or 503-CANN LAW Fax: 503-228-6529

WHAT IS ARBITRATION?

Traditional arbitration (court annexed arbitration - scroll down page)

    Traditional arbitration is a form of dispute resolution which has been used an alternative to court trials for hundreds of years, especially in commercial disputes.  Federal law, and statutes in every state, authorize the use of arbitration to resolve disputes.  There are controversies in the courts and legislatures about whether traditional arbitration is a fair method of resolving consumer disputes.  
 
    Traditional arbitration occurs when the parties agree in a contract to resolve their disputes using the services of one or several private arbitrators. The agreement to arbitrate is usually found in a written contract entered into before the dispute arises, although sometimes, people agree to arbitrate after a dispute arises.  After the traditional arbitration hearing is conducted, the arbitrator(s) render an award.  The courts only become involved if the parties do not honor the award and enforcement must be sought.

    Arbitration has many similarities to lawsuits tried to judges without juries.  Claims in arbitration are asserted in writing in a manner similar to the presentation of claims in court (this is important because an arbitrator's power is limited to claims which have been agreed to be arbitrated and to the dispute presented).  Depending upon the applicable arbitration rules there is usually some discovery but often much less than is available in court.  Witness testimony and other evidence in arbitration are presented in a manner similar to trials, and arbitration hearings are conducted in a similar manner to trials.  None of this is particularly surprising, for most but not all arbitrators are lawyers, most parties in arbitration are represented by lawyers, and awards in arbitration depend upon the courts for their enforceability.

    But, there are also many differences between disputes presented to courts and disputes presented in arbitration.  Some of the differences are apparent from the limits upon similarities just mentioned.  There are never any juries in arbitration (but there is no right to a jury in many kinds of court litigation and it is not uncommon for commercial contracts to include a jury waiver).  Appeals from the awards of arbitrators are generally limited to the adequacy of the process and there is much less room for appeal from an arbitration award than from a court judgment.  The arbitration process is less public, if not more confidential, than litigation in court.

    Generalities about the similarities and differences between arbitration and court litigation beyond those just mentioned are difficult to make because, on the one hand, a party's experience in court litigation will differ from court room to court room and state to state; on the other hand, a party's experience in arbitration will depend on the specifics of the rules of the arbitration service provider and from arbitrator to arbitrator.

    In fact, the greatest consistency between arbitration hearings and trials is the uncertainty of outcome in a particular case on a given day - which is significant impetus in both venues to settlement.

Court Annexed Arbitration

    'Court-annexed' arbitration is technically not arbitration at all, at least under the traditional model.  Rather, it is a method of resolving disputes which are already in court, but without the traditional judge or jury.   

    When their is no agreement to use private arbitration, people with a civil dispute have to go to court.  In the traditional dispute resolution model using the courts, when a lawsuit is filed in court, after several earlier stages (pleadings, motions, discovery), the case is is presented for trial to a judge, or to a judge and jury.  Depending on the volume of cases filed in a court (especially the number of criminal cases, which often have priority) and the number of judges available, even getting a 'small' civil case to trial can involve high cost and long delays. Many cases do not settle until a trial is near, and preparation for trial is often, if not always, more expensive than trial itself.

    To speed up and lower the expense to resolve smaller cases, the most court systems in the United States have developed 'court-annexed' arbitration programs.  The Oregon legislature has passed laws providing for court annexed arbitration.

    What this means in Oregon is that certain categories of cases (cases seeking only damages of less than $50,000, and divorce cases not involving children or support) are diverted into a somewhat non-traditional dispute resolution process.  The cases are heard by experienced lawyers without a jury, under the general supervision of the courts.  The process uses a somewhat simplified method of presentation, but in a procedure that is similar to a trial to a judge sitting without a jury. The reality is that simpler presentation does not affect the result in most cases.  Trial of cases in court annexed arbitration is much cheaper, which means that cost of trials is less of a barrier to justice for those litigants that want a trial and don't care who is the trier of fact as long as he or she is neutral.  Court annexed trials are tried on a much speedier basis than waiting for a judge or jury to be available.

    After the hearing, usually conducted in the lawyer / arbitrator's conference room, the lawyer / arbitrator often writes an opinion, followed by an award which is filed with the court.  For examples of opinions from typical types of cases in court annexed arbitration, click here.  If a litigant is dissatisfied with the award, the litigant may 'appeal' back into the traditional court system to obtain a trial before an elected judge, with a jury if that would otherwise be permitted.  Most court-annexed arbitration awards are not appealed.

    The lawyer / arbitrator is paid by the parties according to a fee structure set by the local arbitration commissions in each county's Circuit Court.  For most lawyer / arbitrators, these fees are much less than they could earn doing other work.  Even though the litigants must pay that fee, the expedited resolution and simplified method of presentation of cases results in huge savings.  The cost of the lawyer / arbitrator is usually awarded as an expense to be paid by the loser.

    The arbitrator in a court annexed arbitration may be selected by the parties.  If the parties cannot agree, the arbitrator will be selected by the court.

Back to Frederic Cann Arbitration main page

© Frederic Cann 2008
This page last updated 3/14/2008

DISCLAIMER This site is an advertisement for neutral arbitration services. Nothing contained here should be considered legal advice, and communication to the arbitrator should not be made for the purpose of obtaining legal advice.  The outcome of every case turns on its facts - which may be disputed, and the applicable law -  which may be disputed, which may differ from jurisdiction to jurisdiction, and which may change.