24 Jan 10 Arbitration in the commercial law
What we have here is failure to communicate. Great line from an old Paul Newman movie. In some respects the words still apply today in family and commercial law arbitration. But in case you’ve been stranded on some desert island eating raw fish and coconuts and are not familiar with the word, arbitration is basically a process between two or more parties to help solve a particular problem with a few rules and guidelines tossed in the pot.
Not many relish the thought of spending days – even weeks sitting around a courthouse waiting for the judge to slam his gavel down and make decisions. Hence: Arbitration in the commercial law. Those who opt for the option to have an impartial third party with no axe to grind decide who wins and loses must agree in advance that no matter the conclusion, they will abide by the decision. The arbitrator could be a man, woman or group.
Settling disputes between commercial businesses or partners is now fairly common and hopefully settled out of court. Each party presents his/her side of the story to the arbitrator and, if handled properly, using arbitration not only avoids a court decision and high costs, but is quick and far more private for the commercial parties involved. The downside is the arbitration guidelines can be anomalous from court action, and the outcome less predictable when a decision is made by a judge.
Back in the old days there was no need for a court of law or commercial arbitration process. A older man dressed in a $1,000 doublebreasted dark suit, shiney black $500 dollar pointed shoes with tassels, a black fedora hat and smoking a fat cigar, would appear on the scene, make the decision in 60 seconds, and say: when I want your advice, I’ll give it to you.
Today it’s used in disputes between banks, brokerage firms, real estate companies, and especially professional sports teams to settle disagreements. California real estate contracts contain a clause that requires all disputes be resolved via commercial arbitration. Labor, uninsured motorists, and book/music publications use this form of arbitration where all must agree on a neutral third party, present their case, and await the decision. Although the arbitration process may be acrimonious at times, it still is the paragon of today’s society, and the only real solution to solving the he/she/they said headaches.
