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Alternatives for Resolving Business Transaction Disputes

NCJ Number
99292
Journal
St John's Law Review Volume: 58 Issue: 1 Dated: (Fall 1983) Pages: 69-91
Author(s)
B H Goldstein
Date Published
1983
Length
23 pages
Annotation
This article identifies three types of business disputes and describes the advantages and disadvantages of using the following modes for resolving such disputes: arbitration, appraisal, statutory simplified procedure, 'rent-a-judge,' and mediation.
Abstract
Business contract disputes may arise over contract interpretation, contract performace, and technical or scientific questions related to contract interpretation or performance. Arbitration -- a nonjudicial proceeding in which disputants voluntarily submit the conflict to an impartial person or group for final and binding resolution -- is appropriate for all three types of disputes. Arbitration is private, convenient, informal, and flexible. The arbitration award is enforceable. Appraisal is appropriate for resolving disputes over property interest. Appraisal to resolve a dispute is voluntary and generally not enforceable unless included in an arbitration award. Some States have adopted statutory simplified procedures that provide a hybrid of arbitration and formal litigation for resolving business disputes. This offers the speed and informality of arbitration, while ensuring the tribunal is guided by rules of substantive law. The 'rent-a-judge' system, widely used in California, involves the disputants' hiring a referee, usually a retired judge, to hear the dispute. This provides the benefits of arbitration with the additional benefit of an experienced adjudicator. Mediation employs a neutral third party who uses nonadversarial techniques to guide the parties in reconciling conflicting positions. Mediation is not enforceable, but is more rapid and less expensive than other modes of conflict resolution. Eighty footnotes are listed.