As an alternate form of dispute resolution, arbitration is billed as bringing both the overwhelmed legal system and citizens - low-cost, low-hassle - to a Promised Land of truth, justice and the American way. That's the public relations, and it's coming from both well-intentioned tort reformers as well as self-interested businesses. The reality is frequently a mess of misunderstanding, abuse of the process, unhappy participants, and/or the option to then go to trial which is frequently taken.
One high-profile example of arbitration seemingly gone astray is how New York City deals with teachers who have been banished from the classroom, for reasons of politics, incompetence, inappropriate/illegal behavior and/of bad luck. They have the option of arbitration. That option can take years. Meanwhile they wait in what's called the "Rubber Room" on full pay and with days accrued toward their pension. In the August 31, 2009 edition of THE NEW YORKER, Steven Brill chronicles the high cost, high hassle and usual ineffectiveness of this whole enchilada. The article seems to blame the teachers's union - U.F.T. More on point might be to blame flaws that haven't been addressed in arbitration itself.
That's one reason to bookmark the new column on arbitration by the U.S. Chamber of Commerce's Institute for Legal Reform [ILR]. Authored by ILR President Lisa A. Rickard, it digs for the right questions and struggles to provide useful perspectives. The August 28, 2009 column goes to the mat on the arbitration debate associated with the Bank of America.
Alternate forms of dispute resolution have gotten our attention because we have morphed from a nation of abundance to one with scarce resources. Not everyone is going to be able to have ready access to the courtroom. If we don't fix the problems associated with arbitration, the public will be sitting ducks for the use of contingency by government entities in litigation. Championing the "common good" has become as twisted a concept as "war is peace."
Pending at the Supreme Courts in both Pennsylvania and California are reviews of contingency. The perils embedded in that option are spelled out in the amicus briefs submitted to both High Courts by the National Paint and Coatings Association [NPCA]. Here is the one for PA SC Download DC-260-8076FE418. And here is the one for the CA SC Download AmicusBrief. Like the NPCA amicus brief submitted to the Rhode SC about the review of the nine years of lead paint public nuisance litigation, these can provide the state SCs with a narrow passageway through the complex issue.
Useful background reading might be "Life Without Lawyers: Liberating Americans from Too Much Law," by Philip K. Howard.