You probably bought a lemon.

But you are not alone! Researchers found that of the 60 million cars purchased between 2013 and 2017, at least 1% were lemon cars.

Moreover, another study found that two-thirds of lemon cars’ defects are noticed within one month of the purchase, with 41% of them breaking down while driving. The study also found that braking and starting the car were the most reported issues.

But what’s a lemon? And what’s lemon law? Lemon laws are regulations that protect and provide relief to consumers who purchased lemon vehicles that do not meet the market’s quality and performance standards.

This article will break down the US lemon laws and discuss lemon laws from different states across the country.

While you’re at it, learn more about your consumer rights using our guides on Tesla, Upwork and frealncer.com, AirBnB, and Amazon disputes. You may also want to read more about small courts and ADR providers such as JAMS ADR in the USA.

What Is a Lemon Law?

In US slang, defective cars and bad investments are known as lemons.

Lemon laws are, therefore, regulations that protect and provide relief to consumers who purchased lemon vehicles that do not meet the market’s quality and performance standards.

Essentially, these laws work to get automakers to honor their warranties to repair or replace your car or recompensate you.

These laws were initially targeted at vehicles and auto manufacturers only but were later on expanded to include other consumer products.

In the US, lemon laws are enacted on state and federal levels. Each state has its own lemon laws with varying rules and scopes. The federal lemon law is known as the Magnuson-Moss Warranty Act of 1975.

The Federal Warranty Law

To qualify for protection by the federal lemon law, the purchased car must still be under the manufacturer’s warranty. Moreover, you must have experienced at least one of the following:

• Three or four unsuccessful attempts to repair the same defects, or as determined by the court. All repairs must be undertaken at the dealership or the manufacturer,
• The defects and the attempts to fix them happened within one or two years from the purchase date, or
• The car remained out of commission for 30 consecutive days.

If you meet any of the above requirements, you are due a recompensation from the manufacturer, usually a refund or a replacement.

State Lemon Laws

State lemon laws vary from a state to another. Here are some examples:

Connecticut Lemon Law

The Connecticut lemon law covers passenger and commercial vehicles that are either sold or leased in the state. Agricultural tractors are excluded.

To qualify for protection under the Connecticut lemon laws, you must:

• Have made four attempts to repair your car of defects that limit the car’s usability, or
• Have made two attempts to repair severe and life-threatening defects
• Have your car out of service for 30 days, and
• Have detected the defects within the first two years or 24,000 miles, whichever comes first.

California Lemon Law

The lemon law of the state of California covers personal and family vehicles, off-road vehicles, chassis and chassis cabs, and dealer-owned and demonstrator vehicles. Motorcycles are excluded.

To qualify for California’s lemon laws protection, you must meet these requirements:

• You made two repair attempts of serious and life-threatening defects.
• You made four repair attempts of defects that hindered the usability of the car.
• You were unable to use your car for 30 consecutive days, and
• You detected and attempted to repair the defects within the first 18 months or 18,000 miles, whichever comes first.

Massachusetts Lemon Law

The Massachusetts lemon law covers all vehicles, including off-road, auto homes, and motor bicycles. However, vehicles used for business purposes are excluded.

These are the requirements you must meet to qualify:

• Three repair attempts, or
• 15 days out of service, and
• Defects are detected and unsuccessfully repaired within the first year or 15,000 miles, whichever comes first.

Minnesota Lemon Law

The Minnesota lemon law covers passenger vehicles, pickup trucks, vans, and chassis that are sold or leased for a consumer within the state. The vehicles must be at least 40% used for personal or family purposes.

These are the Minnesota lemon laws requirements:

• One unsuccessful repair attempt of a failed braking or steering system that are life-threatening,
• Four repair attempts of defects that hinder the usability of the car, or
• 30 business days out of service for other defects, and
• The defects were detected in the express warranty period or the first 2 years from the purchase date.

New Jersey Lemon Law

In New Jersey, the lemon law covers passenger vehicles and motorcycles that are purchased, leased, or registered in the state. Living facilities of auto homes are excluded.

The following are the requirements for the New Jersey lemon laws:

• Three repair attempts of defects that limit the car’s performance and usability,
• More than 20 days out of service, or
• One repair attempt of a serious and life-threatening defect, and
• The defects are detected within the first two years or 24,000 miles, whichever comes first.

New York Lemon Law

Lemon law of the state of New York covers passenger vehicles that are purchased, leased, transferred, or registered in New York, including motorcycles. Off-road vehicles are excluded.

You qualify for protection under the New York lemon laws if you meet the following requirements:

• Four unsuccessful repair attempts of defects that hinder the performance and use, or
• A serious and substantial defect within 20 days of the receipt of notice by the consumer using certified mail, and
• The defects are detected within the first two years or 18,000 miles, whichever comes first.

Evidently, these state laws vary significantly when it comes to the types of vehicles, the repair attempts, and the coverage period. Find your state lemon law statutes and check your car’s manufacturer’s lemon laws.

Do Lemon Laws Apply To Used Cars?

Under the federal warranty law, the purchased car must be under the manufacturer’s warranty when the defects are detected to be eligible for protection. This means that the federal lemon laws apply to used cars so long as they come with a warranty too.

However, used cars rarely come with warranties and that renders them ineligible for the federal warranty law protection.

When it comes to state lemon laws, only seven states include used cars under their lemon statutes. These states are Connecticut, California, Massachusetts, Minnesota, New Jersey, New Mexico, and New York.

New York’s Used Cars Lemon Law

New York is one of the few states that have a lemon law for used cars. The law required car dealers to provide consumers with written warranties for used and leased cars.

The length of the warranty depends on the car’s mileage before the purchase or lease

Under these warranties, dealers are required to repair any defects in the following parts free of charge: 

Engine, transmission, drive axle, brakes, steering, radiator, alternator, generator, starter, and ignition system (the battery is excluded).

The cars covered by the New York used cars lemon law are those that are:

• Purchased, leased, or transferred after the first two years or 18,000 miles from the original delivery, whichever comes first,
• Purchased or leased from a New York dealer,
• Purchased or leased for at least $1500,
• Less than 100,000 miles at the time of purchase/lease, and
• Used primarily for personal purposes.

The law allows the dealer a reasonable chance to repair the defect, usually three or more attempts. A reasonable chance can also be 15 or more cumulative out of service days due to the defect.

What Should You Do If You Purchased a Defective Car?

• Notify the dealer or manufacturer from which you purchased the car of the defects or problems you’re facing. Make sure you notify them before your warranty expires.
• Keep records of all repairs, bills, and correspondence.
• Consult or hire an attorney.

The post What is the Lemon Law? USA Lemon Laws Simply Explained appeared first on ODR Guide.

It is noteworthy to mention that these fees are up to the latest information provided by the respective centers in 2021. They are subject to change by the Centre, currency fluctuations, and laws. They are also estimative and should only be used for reference.

Below is a detailed infographic map for the major Arbitration Center costs and fee calculation structure from around the world:

Tip: Did you know that some of these centers handle crypto-related disputes?! Check it out in How To Dispute a Crypto Transaction? Full Guide

To learn more about Arbitration, check out What is an Arbitration Agreement? What is its purpose?, and What is Binding Arbitration? Is it better than Court?, and Alternative dispute resolution (ADR) and it’s advantages and disadvantages.

Arbitration Costs in the Gulf Region

Arbitration Costs in the UAE

Whilst there are several arbitration centers in the UAE, the most well known are:

• Dubai Internation Arbitration Centre (DIAC).
• Dubai Internation Financial Centre DIFC-LCIA .
• Abu Dhabi Commercial Conciliation & Arbitration Centre (ADDCCAC).

DIAC Arbitration Fees

There is a fixed AED 5,000 as a registration fee. Other fees are shown below.

Currency conversion factor: USD 1 = AED 3.67

DIFC Arbitration Fees

The structure of DIFC-LCIA is a bit different from DIAC as its arbitration fees are billed hourly, as listed below:

• Registration Fee: AED 10,000
• Registrar / Deputy Registrar / Counsel AED 1,500 per hour.
• Other Secretariat personnel AED 1,000 per hour.
•  Arbitral Tribunal AED 2,500 per hour.

However, the fees of the arbitral tribunal are subject to change and are informed in advance prior to the commencement of the arbitration. In addition, these fees exclude other kinds of expenses such as traveling and printing.

ADCCAC Arbitration Fees

The Abu Dhabi Arbitration Center fees are divided into two categories depending on the number of arbitrators in the arbitration panel.

Fees of an arbitration panel of Three Arbitrators in ADCCAC are listed in the following table.

Arbitration Costs in Saudi Arabia (KSA)

The main arbitration center in KSA is the Saudi Center for Commerical Arbitration (SADR). The arbitration costs in Saudi Arabia (KSA) are billed as follows:

Arbitration Costs in Qatar

Arbitration costs in Qatar International Center for Conciliation and Arbitration (QICCA) are calculated via an online calculator.

The fees are broken down into:

• registration fees
• Administrative expenses
• Arbitrators’ fees:

This is what you should expect to pay if you claim is $100,000. You can calculate your fees using the QICCA fees calculator.

Arbitration Costs in Africa

As of 2020, the top arbitration centers in Africa are the following:

• Arbitration Foundation of Southern Africa (AFSA).
• Cairo Regional Centre for International Commercial Arbitration (CRCICA).
• Kigali International Arbitration Centre (KIAC).
• Lagos Court of Arbitration (LCA).
• Nairobi Centre for International Arbitration (NCIA).

The busiest ones are the AFSA and CRCICA.

Arbitration Foundation of Southern Africa costs for arbitration

The fee structure is set as follows:

• a registration fee of USD 345.
• an administration fee ranging from USD 1,000 to a maximum of USD 54,950.
• a fee for extra, reasonable or actual expenses incurred in administration; and
• arbitrators’ fees.

Cairo Regional Centre for International Commercial Arbitration (CRCICA) costs

The costs of arbitrating with CRCICA include a fixed registration fee of $500. Other fees such as administrative and arbitrators’ fees are found in the calculator of fees. See the below screenshot for a sample dispute of $1,000,000.

Arbitration Costs in EUROPE

European Court of Arbitration (ECA)

The European Court of Arbitration was founded in 1992 in Strasbourg, France. All the arbitration costs of this world-renowned center depend on the amount in dispute including the administrative and the arbitrators’ fees. They consider their costs very affordable for the quality of their services.

Here are the fees incurred for a sample dispute of €1000.

ICC International Court of Arbitration

A world-leading arbitration center since 1923, the Paris-based International Court of Arbitration has one of the highest filing fees which equals $5000 payable by the claimant.

In addition to the filing fee, a provisional advance is paid by the claimant and will be fixed by the Secretary-General.

The following picture showcases the arbitration fees for a claim of $10,000 by the ICC International Court of Arbitration cost calculator.

Vienna International Arbitration Centre (VIAC)

The Vienna International Arbitration Centre is the most famous arbitration center in Central and South-Eastern Europe since 1975. the costs of arbitration with this center depend on the number of arbitrators and the amount in dispute.

For reference, the amount in dispute in the following table is €10,000.

French Association of Arbitration (AFA)

The French Association of Arbitration offers a great deal for claims less than €50,000. When the claim is less than €50,000 and only one arbitrator is required, the administrative fees will be reduced by half the original fee.

Here are the AFA costs of arbitration:

Arbitration Costs in the United Kingdom

London Court of International Arbitration (LCIA)

The LCIA is one of the oldest arbitration centers in the world and it’s has been active since 1891. It is also the main arbitral institution in the UK. The costs of arbitrating with LCIA include:

• A registration fee of £1950
• An administrative hourly fee of £165-£280 per hour
• An arbitral tribunal maximum hourly rate of £500/hour.

If needed, a tribunal secretary will be appointed and will cost £75-£175/hour.

In case of emergency arbitration, the LCIA offers a fixed application fee of £9000 and an arbitrator’s fee of £22,000.

Centre for Effective Dispute Resolution (CEDR)

With no application or registration fee, the CEDR is probably the most affordable arbitration center in the UK.

Its costs include an appointment fee of up to £3000 depending on the amount in dispute payable by the involved parties and an arbitrator’s fee of £250-£750 per hour.

International Dispute Resolution Center (IDRC)

This London-based center is one of the most famous ADR providers in the UK. It provides fully-equipped rooms for arbitration and mediation. When it comes to pricing, they only showcase the booking and rooms fees.

To book a virtual arbitration with IDRC, you should expect to pay £1265-2010. Arbitration rooms can cost anywhere from £315 to £3995 depending on the type of the room and its capacity. Moreover, overtime hours cost £130-265 per hour.

Arbitration Costs in the USA

American Arbitration Association (AAA)

The fees of arbitration with the AAA vary depending on the type of dispute. They handle consumer, commercial, construction, and employment-related disputes. When it comes to consumer disputes arbitration, you should expect to pay a filing fee of no more than $200.

Here’s where you can find all the detailed AAA rules and fees for each type.

AAA’s International Center for Dispute Resolution (ICDR)

This AAA center is dedicated to international disputes where either one party or both parties are not American residents or citizens.

The claimant should expect to pay an initial fee and if the arbitration proceeds to the first hearing, they pay the final fee that can be lower or higher than the initial one. this schedule shows the fees of arbitration with AAA’s ICDR:

This schedule does not include the arbitrators’ fees. Every arbitrator will determine their fees and add them in the award. Also, you should know that additional parties incur more fees.

JAMS

JAMS offers ADR services for business and legal disputes globally. They are one of the few ADR providers whose fees are not based on the amount in dispute.

The arbitrators’ fees are billed hourly and they are set by the arbitrators themselves. The other JAMS fees are fixed and they are:

• A filing fee of $1750 for two parties and $3000 for three or more. it’s the same fee for domestic and international disputes.
• Consumers’ filing fee is $250
• Employers disputing employment contracts pay a filing fee of $400.
• 12% of the total or arbitrators’ fees as case management fees

Other fees might incur. Read our detailed review on JAMS and when to approach them in; Your Quick Guide to JAMS ADR Platform: Mediation, Arbitration, and Dispute Resolution Services

Chicago International of Dispute Resolution Association (CIDRA)

CIDRA is Chicago’s top ADR provider. To arbitrate with them, you should expect to pay:

• $500 as an administrative fee payable by each party
• A minimum of $1500 as a filing fee
• A minimum of $3000 as a filing fee if the claimed amount is not stated at the registration stage.
• $600/hour is the arbitrators’ hourly rate
• Arbitral tribunal fees depending on the amount in dispute in addition to the case’s complexity and the arbitrators’ working hours.
• Any expenses incurred by the arbitrators

The following fees schedule shows the filing fees for the amount in dispute:

Arbitration Costs in Canada

ADR Chambers

This is Canada’s largest ADR body, and it’s relatively less expensive than most arbitration centers around the world. They charge:

• $500+HST as a filing fee
• $250-800/hour as arbitrators’ hourly rate depending on their experience.
• Hearing days fixed rates set by the arbitrators’
• $750+HST as arbitration room booking fee

ADR Institute of Canada (ADRIC)

The following schedule shows the fees of arbitration in the ADRIC:

1 CAD = 0.81 USD

The case service fee is payable by both parties and will depend on the total of the claim and counterclaim if there’s any.

Canadian Commercial Arbitration Center (CCAC)

The CCAC specializes in arbitrating commercial disputes worldwide. They charge a filing fee of CA$1000 and arbitrators’ fees are billed hourly. Check the CCAC’s website to know more about the fees included.

Arbitration Costs in South America

Arbitration and Mediation Center of the Brazil-Canada Chamber of Commerce

The Brazil-Canada Chamber of Commerce offers arbitration and mediation services for all commerce-related matters. Their fees include:

• $707 as a registration fee
• $9277 as administrative fees
• $8349 for one arbitator or $21150 for three arbitrators

Here’s the CCBC’s fees calculation for a dispute claim of $10,000 with one arbitrator. 1 USD= 5.66 BRL

Arbitration Center of Mexico (ACM)

This is Mexico’s top ADR provider that specializes in arbitration only. They provide a fees calculator on their website to estimate your costs to arbitrate your dispute with them.

Here’s what you should expect to pay if you claim an amount of $10,000:

Administrative fees of around $985 and one arbitrator’s fee of around $2127.

Arbitration Costs in Russia

The International Commercial Arbitration Court (ICAC)

Russia’s ICAC offers domestic and international arbitration services. The fees calculator below shows arbitration fees for international disputes with one arbitrator.

This is what you should expect to pay if you claim an amount of $10,000.

St. Petersburg International Commecial Arbitration Court

St. Petersburg’s ICAC is another major international arbitration center in Russia. Besides the administrative fees listed below, you should expect to pay at least $2000 or %10 of the amount in dispute as arbitrators’ fees, taking into account their hourly rates as well. The claimant must pay $1000 as court expenses.

Arbitration Costs in China and Hong Kong

China International Economic and Trade Arbitration Commission (CIETAC)

The primary arbitration of China, CIETAC offers affordable services compared to other international centers of the same quality. For foreign disputes, you wSill have to pay around $1564 as a registration fee and an equal amount as the arbitration fee.

Here’s the case handling fees schedule:

Beijing International Arbitration Commission (BIAC)

BIAC offers a fixed fee for claims under $10,000 which is $2659, making a very affordable option for small claims.

When the claim is more than $10,000, you should expect to pay an administrative fee and arbitrators’ fees depending on the amount in dispute.

Hong Kong International Arbitration Commission (HKIAC)

The HKIAC is Hong Kong’s leading arbitration center. They charge:

• HK$8000 for registration
• HK$6500/hour as the arbitrator’s maximum hourly rate
• HK$2500/hour as the tribunal secretary’s maximum hourly rate

The administrative fee depends on the amount in dispute as shown in the following table.

1 HKD= 0.13 USD

Arbitration Costs in India

Indian Institute of Arbitration and Mediation (IIAM)

If you are planning to arbitrate a dispute with the IIAM, here’s what you need to know:

• Filing fee is $1000 for international arbitration
• Filing of application $250
• Arbitration fees depend on the amount in dispute
• Administrative fees depend on the amount in dispute

Arbitration Costs in Singapore

Singapore International Arbitration Center (SIAC)

SIAC is a world-leading center of arbitration and probably the most successful one for international disputes. If you’re going to arbitration with them, you should expect the following fees, or calculate your own costs with the SIAC fees calculator.

• Filing fee is 2000 SGD
• At least 3800 SGD in admin fees depending on the amount in dispute
• At least 6250 SGD in arb fees depending on the amount in dispute
• Appointment fee is 3000 SGD for one arbitrator, 4000 SGD for two, 5000 SGD for three.

Arbitration Costs in Turkey

Istanbul Chamber of Commerce Arbitration and Mediation Center (ITOTAM)

This is Turkey’s leading arbitration center under the Chamber of Commerce in Istanbul. All fees of arbitration with ITOTAM are based on the amount in dispute include the registration fee, administrative fees, and arbitrators’ fees.

You should expect to pay at least 400 TL as a registration fee and 6500 TL as one arbitrator’s fees. 1 TL= 0.11 USD

Arbitration Costs in Australia and New Zealand

Australian Centre for International Commercial Arbitration (ACICA)

The ACICA is another arbitration center that charges depending on your claim’s amount, but it has a fixed registration fee of $2500.

Administrative fees depend on the amount in dispute with the maximum fee amount equaling to $80,000.

Arbitrators’ and mediators’ Institute of New Zealand (NZDRC)

The NZDRC offers a fixed fee arbitration for claims under 50,000NZ$ and which involve less than three issues. 1 NZD = 0.72 USD

If you’re interested in arbitrating in New Zealand’s DRC, you can calculate your fees on their website to get an estimate of your costs.

New Zealand International Arbitration center

NZIAC charges the following fees for their services:

• A registration fee of 2000 nzd for one arbitrator or 3000 nzd for more
• Administrative fees of at least 1250 NZD depending on the amount in dispute
• Arbitration fees are fixed for amounts less than 100,000 NZD of at least 3500 NZD and 15,000 maximum.
• Arbitration fees for amounts that exceed 100,000 NZD are set by the arbitrators and they are at least 30,000 NZD.
• Security for arbitral tribunal fees of at least 10000 NZD for one arbitrator and 25000 for three or more.

Arbitration Costs in Scandinavian Countries

Arbitration Institution of the Stockholm Chamber of Commerce (AISCC)

One of the oldest arbitration centers in the world, the AISCC has been solving disputes since 1917.

If you’re planning to go into arbitration with the AISCC, you might want to calculate your costs before.

Oslo Chamber of Commerce

1NOK= 0.12 USD

Arbitration fees of OCC depend on the amount in dispute, you should expect to pay at least 10,000 NOK including 4 hours of the procedure. Moreover, arbitrators’ fees are at least 12,000 NOK and arbitration is billed hourly at a rate of 1150 NOK/hour.

The Finland Arbitration Institute (FAI)

A leading ADR center in Finland and Northern Europe, FAI’s fees are straightforwardly detailed on their website. To file a dispute with FAI, you must pay a filing fee of €3000+ VAT.

Here’s what you should expect to pay if your claim equals €10,000.

You can also calculate your expenses using the FAI’s fees calculator.

The post Your Global Infographic Guide of Arbitration Center Fees, Costs, and Calculators appeared first on ODR Guide.

Mediation is an informal, voluntary process where a third person, called a mediator, assists the parties to a dispute in reaching an amicable settlement. Arbitration, on the other hand, is a dispute resolution process in which the parties to a dispute agree to submit the dispute before a single arbitrator, or sometimes a panel of three arbitrators that renders a final decision in favor of one of the parties.

If we were to approach these methods of dispute resolution separately, we would reach the conclusion that an arbitrator’s role is essentially different from that of a mediator, and the arbitrator is not empowered to act as a mediator.

The function of an arbitrator is to examine the case put before him or her. A mediator, on the other hand, acts as a facilitator for the parties to help them reach their own agreement that satisfies, at least to some extent, their core preferences.

So, can an arbitrator meditate too? An arbitrator can mediate, noting that the role of an arbitrator is different than that of a mediator. To be more on-point, the combining of the two processes “Med-arb” is worth exploring.

What is Med-arb? , Med-arb is a hybrid mechanism, which combines the two processes of mediation and arbitration, with the arbitrator also serving as the mediator. In practical terms, parties to a dispute choose a third-party neutral who acts as a mediator and arbitrator.

How does Med-arb work? The parties will attempt to reach a voluntary agreement with the help of the third-party neutral through mediation. If the process is not successful or if the parties still have some unresolved issues in the dispute, the same neutral will act as an arbitrator and settle the remaining issues/dispute.

What are the costs of med-arb? The average expected cost of med-arb is $4,204, noting that it varies drastically depending on the case type, money disputed, complexity and location.

For a more detailed explanation on arbitration, mediation, and even conciliation please read What are the differences between arbitration and mediation? All you need to know about arbitration and mediation and What is Conciliation? What is the difference between conciliation and mediation? and for family disputes in Family Disputes Mediation: Resolving Inheritance, Business, Property Conflicts, and More.

You may also refer to our review on Document Crunch, the AI platform, for reviewing contracts with the intent of reducing risks and disputes.

Historical Background of Med-Arb

Med-Arb is not a new phenomenon. In the early 1940s, some arbitrators were advocating for its use. They argued that the role of arbitrators is to assist the parties in completing their bargaining and the most efficient way of doing so is to resort to mediation first.

But it was only two decades later when Med-Arb was formally resorted to as a dispute resolution mechanism. In 1969, Sam Kagel, a San Francisco lawyer, and arbitrator employed the technique to settle a nurse strike in the Bay area of San Francisco.

As a med-arbiter in the dispute, he persuaded the parties to give up their respective economic weapons — the right to strike and to lockout — in exchange for concessions in scheduling time and weekends off.

By the late 1960s and early 1970s, the mechanism spread to Canada, where the Quebec Department of Labour and the federal Department of Labour embodied it to settle ongoing disputes in the Quebec construction industry and in the creation of Via Rail.

The use of Med-Arb continued to increase during the 1980s, spreading worldwide in settling disputes in diverse fields such as nursing, journalism, public utilities, education, and commerce.

Nowadays, Med-Arb is most commonly used in labor law disputes, and also commercial law.

The Process of Med-Arb

Med-Arb is not necessarily regulated and its format depends on a case-to-case basis. In practice, the suggestion to use the Med-Arb process almost always arises at the initial meeting with the neutral.

However, mediation can also commence after arbitration has been initiated, and if it is unsuccessful, the parties return to the arbitration procedure.

The arbitrator may also choose the appropriate moment in the course of the proceedings to offer meditation services for settlement purposes.

Russell Thirgood explains that arbitrators conduct the mediation in one of the following ways: “the arbitrator consulting with both parties, arbitrators consulting with the parties individually, the parties consulting with each other without the arbitrators present or a combination of these techniques.

A common factor in determining whether Med-Arb is appropriate is the willingness of the parties to settle, and their desire to embody the mechanism within their process.

In addition, in order to create a productive and fair process, the neutral must possess essential skills. First of all, giving the hybrid nature of the proceedings, the neutral must have expertise and skills in both mediation and arbitration, as well as understand the requirements and standards for both roles.

In this sense, the neutral must be able to move from a facilitative role to an evaluative, decision-making one.

Second, the neutral, when acting as an arbitrator, must be able to disregard the information that was shared by the parties during the mediation.

Third, and finally, the neutral must be able to gain and keep the trust of the parties and establish and maintain credibility for the process.

Institutional Recognition of Med-Arb

Throughout time, Med-Arb has been recognized by various jurisdictions as an effective way of dispute settlement. The American Arbitration Association (AAA) recommends Med-Arb in certain circumstances.

At the same time, JAMS administers Med-Arb cases if it is within the contract or the parties have stipulated to it. In 2020, the ADR Institute of Canada adopted the Med-Arb Rules and announced a new Chartered Mediator-Arbitrator (C.Med-Arb) professional designation to enhance the use of med-arb in Canada.

In China, Med-Arb is embodied within the Arbitration Law of China, which came into effect in September 1995, as well as the respective Arbitration Rules of Chinese.

Article 51 of the Arbitration Law of China states that “a written conciliation statement [resulting from mediation] and an arbitration award shall have equal legal effect.”

The provision further enables arbitrators to decide when and how to conduct conciliation (“mediation”) during the arbitration.

Article 39 of the Arbitration Rules of the Beijing Arbitration Commission (“BAC”) adopts a similar approach but clarifies that mediation may be conducted at the arbitral tribunal’s discretion, as long as the tribunal obtains consent from both parties:

Advantages and Disadvantages of Mid-Arb

Advantages of Mid-Arb

The advantages of Mid-Arb can be summarized as:

1. Offers mediation flexibility and arbitration finality.
2. Provides an urgecny and to resolve the diputes, expecially in complex cases as all parties prefer to avoid arbitration procedures.
3. Provides cost saving in comparison to litigation and arbitraiton.
4. Helps preserve the relations between the parties by promoting amicable settelement.

Proponents of Med-Arb claim the mechanism joins mediation’s flexibility with arbitration’s finality.

With med-arb, parties can receive the advantages of both an enforceable award and amicable settlement. Arguing that the benefits outweigh the negatives,’ proponents believe self-determination is embodied within the initial consent agreement.’

The studies related to the process support the notion that Med-Arb reduces costs and increases the efficiency of the dispute resolution process.

In addition, Med-Arb practitioners report that most disputes are resolved within the mediation stage, without the need to resort to arbitration.

However, Med-Arb is most likely to be successful in cases in which there are many complex interrelated issues and the arbitration hearing is expected to be lengthy.

Disadvantages of Mid-Arb

The disadvantages of Mid-Arb include:

1. Neutrality of the arbitrator might be affected during mediation hearings.
2. Mediation can be utilized as stalling technique to gather confidential information on the other party.
3. Confidential information might be inadvertently revealed.

A common critique of Med-Arb is that information shared during confidential mediation caucus sessions will impact the impartiality of the neutral and the arbitration award thereof.

Some arbitrators do not consider this to be a problem; others decline to serve as mediator-arbitrators for just this reason.

Mediation communications in private caucus sessions provide the opportunity for advocates to reveal unfavorable information about the other side, knowing these communications are private and confidential.

However, in Med-Arb, the parties are aware they may reach arbitration, and sharing such confidential information may work against them.

Going Forward

Med-Arb is not merely the merging of separate mediation and arbitration processes, but a unique process designed to meet the needs of parties to a dispute. In the words of Mr. Martin C. Weisman, Med-Arb is ‘The Best of Both Worlds’.

In Med-Arb, arbitrators can mediate, which requires a high level of practitioner competence to do successfully. Whether the advantages of Med-Arb outweigh the disadvantages depends on the case-to-case basis.

Also subjective is the question of how efficient ‘Med-Arb is?’However, it is without a doubt that this procedure does allow arbitrators to mediate.

The post Can arbitrators mediate? All you need to know about Mid-Arb, Arbitration and Mediation appeared first on ODR Guide.

In response to the costly and lengthy traditional court proceedings, alternative dispute resolution (ADR) methods have been developed in an attempt to settle disputes.

Traditionally, the different kinds of processes that make up ADR include arbitration, mediation, negotiation, conciliation, and ombudsman.

Amongst these processes, arbitration has emerged during time as the most developed, advanced, and structured method of resolving disputes involving states, individuals, and corporations.

In recent years, more and more parties have resorted to arbitration instead of the traditional court proceedings given its faster, cheaper, and less complex nature compared to litigation.

However, as time passed by and arbitration became more and more expensive, parties have resorted to other methods of ADR, and particularly, mediation.

Nowadays, it is common practice to include in dispute resolution provisions a requirement that, before a dispute is referred to arbitration, it must first be referred to some sort of structured mediation between the parties (generally under a multi-tiered dispute resolution clause).

Although both are part of the umbrella term of ADR, these two processes present key significant differences, which this post aims to examine.

So, what are the differences between arbitration and mediation? The main differences between arbitration and mediation are summarized below

Many factors influence the expected time and overall cost for resolving dispute arbitration or mediation. Factors affecting the arbitration or mediation cost include:

• Type of dispute.
• Complexity of dispute.
• Value of the dispute.
• Involvment of other stakeholders
• Willingness of the parties for concluding the dispute.
• Relation and future prospects between the parties.

So, how long does arbitration take? The expected time for a domestic dispute arbitration award is 7 months to 7.3 months.

As for Internation arbitration, The expected time for international arbitration is 12 months while ranging from 9 months to 16 months or more.

Based on data gathered from the LCIA “London Court of International Arbitration” Arbitration TIme in comparison to the case value is tabulated below:

One would ask, so how long does mediation take? On average mediation take 30 days to be settled. Depending on the complexity and type of dispute it could range from several hours to a couple of months.

And, how much does mediation cost? A mediator charges between $300-$500 per hour, but this rate can go upper depending on the complexity of the case and the mediator.

You might be also interested to read about the Arbitration and Mediation hybrid “Mid-Arb” in Can arbitrators mediate? All you need to know about Mid-Arb, Arbitration and Mediation

In particular, this post explains the nature of these proceedings, their different stages, the role of an arbitrator compared to that of a mediator, as well as the outcome of the proceedings.

However, before dwelling on the substantive part, this post will explain, in general terms, the general characteristics of this arbitration and mediation.

To learn more about arbitration and mediation, you may refer to our posts on Arbitrability, Binding arbitration, and mediation.

ARBITRATION

Arbitration is a private and confidential process, where the parties to a dispute agree to submit the dispute before a single arbitrator, or sometimes a panel of three arbitrators (commonly known as the Arbitral Tribunal).

During the arbitration, the arbitrator or arbitrators hear the evidence and arguments presented by the parties, take them into consideration, and render a decision (known as the arbitral award).

In general, arbitration commences as a result of a contract between the parties, the so-called arbitration agreement in which the parties indicate the procedure to be followed during the proceedings.

Hint: Our worldwide map for arbitration costs can assist you in estimating your arbitration fees.

MEDIATION

The term mediation is used to describe an informal process where parties in a dispute request a third person or persons to assist them in their attempt to reach an amicable settlement.

This third person is referred to as a mediator and he/she has received training in the field. Mediation is most common voluntarily or entered into as part of a multi-tiered dispute resolution clause, but it may be, in certain cases, court-ordered.

Mediation can be initiated at any time before arbitration commences and even during an arbitration case before it concludes.

DIFFERENCES

Format of the proceedings

The essential difference between arbitration and mediation lies in their format.

Arbitration is a structured and formal process. Even though not a judicial process in nature, arbitration is still governed by a set of laws, which apply at different stages of the proceedings. First and foremost, the law governing the recognition and enforcement of the arbitration agreement.

Second, the lex arbitri, the law that governs the actual arbitration proceedings themselves.

This, and generally, the most important, there is the law or set of rules that the arbitrator must apply to the substantive matters in the dispute.

And finally, there is the law that governs the international recognition and enforcement of the award rendered by the Arbitral Tribunal.

Therefore, arbitration works efficiently because it is governed by a complex public system of national laws and international treaties.

On the other hand, mediation is a more flexible process, where the mediator assists the parties to the dispute to identify and consider options for the amicable settlement of the matter at hand.

Essentially, in mediation, the parties to the dispute are prompted to have an open discussion and narrow their differences in order to reach a common solution.

Mediation is not subject to any comprehensive system of national or international law. In a mediation, the parties seek to solve their settlement through an amicable dispute.

With the exception of the legal proceedings related to the enforcement of a mediation agreement and public policy concerns, this process is subject to practically no legal procedure and few legal limitations.

Stages of the proceedings

Arbitration is similar to a courtroom trial in the sense that it may include: a hearing; a pre-trial process, involving pleadings, discovery, and the preparation of written witness statements; cross-examination of witnesses; and the rendering of the award.

For this reason, arbitration proceedings, particularly in international commercial and investment disputes can take years.

The American Arbitration Association describes arbitration as being composed of five main steps:

• Preliminary hearing, where the parties meet to discuss substantive case issues, as well as exchange information and the witness lists
• Information exchange and preparation: parties share information and arbitrators handle any related challenges.
• Hearings: during this stage, parties present evidence and testimonies before the arbitrator.
• Post hearing submissions: this stage is not mandatory in nature, but it can occur when the parties need to submit additional information to the arbitrator.
• Award: the final stage of the arbitration proceedings, when the arbitrator renders a decision (award) and closes the case.

The mediation process, on the other hand, is less lengthy and complicated.

Depending on the complexity and importance of the dispute at hand, the duration of mediation can vary between several hours, days, or even months.

As a general rule, in most mediations, the parties reach a settlement within 30 days since the dispute has been brought to the attention of a mediator.

The mediation process is typically composed of two stages: the joint session and the caucasus, which may also occur simultaneously.

In the joint session, the mediator, a spokesperson for each party (typically a lawyer) and someone with the authority to enter into a binding settlement (it can be the spokesperson or another representative of the parties) have a meeting.

The joint session aims to provide information to the mediator on the dispute at hand, uncover any differing views on the facts, and clarify what each side considers a satisfactory resolution to be.

Sometimes, a joint session would also include other parties which are not necessarily part of the dispute, but they may be interested in the outcome of the process.⁴

After the joint session, the mediator would typically ask the parties to the dispute in a caucus. The caucus is a separate, confidential session with each party to the dispute, where the mediator collects information about each side’s interests.

Sometimes, mediators will continue discussions in joint sessions parallel to the caucasus, hoping that the open exchange of views will resolve the dispute faster.

Role of arbitration and mediator

The function of an arbitrator is essentially the same as that of a judge in a court of law, i.e. to examine the case put before him or her.

Therefore, an arbitrator examines the documents, evidence, and arguments presented by the parties applies the relevant laws and rules to the arbitration and renders the final award, which is binding upon the parties and legally enforceable.

In certain circumstances, the arbitrator may ask for further documents or explanations with regard to the documents being examined.

A mediator would typically ask questions to the parties in order to identify the issues in the dispute and support the parties in developing options to resolve the dispute.

Unlike an arbitrator, the mediator does not decide over the dispute nor does he/she have the power to impose any binding settlement upon the parties.

The mediator is there to facilitate conversations, suggestions, proposals, and counter proposals between the parties.

In addition to their formal role during the proceedings, mediators and arbitrators are also differentiated by the legal skills required to perform their role.

Resolving legal-type disputes is at the heart of arbitration.

An arbitrator needs to draw on his or her knowledge of relevant laws and policies in order to weigh up each party’s case and make a decision.

For this reason, arbitrators would usually have served as lawyers or judges and possess strong decision-making skills.

Mediators, on the other hand, are often people who have been trained in the social sciences such as psychology or sociology and are able to bring the parties to the dispute to a common ground.

The outcome of the proceedings

The final main difference between arbitration and mediation is related to the outcome of the proceedings.

Arbitration will always result in a resolution of the dispute that comes in the form of the arbitral award. On the other hand, mediation does not necessarily have to result in a settlement, even though research has found that more than 80% of the parties to mediation reach a common settlement.

The decision of the arbitrator or arbitrators is binding and legally enforceable upon the parties, whether they agree with it or not.

An arbitral award is very rarely subject to an appeal procedure, and in such circumstances, the issue would be related to the enforcement of the award rather than the proceedings themselves.

At the same time, the settlement in mediation might be enforceable only if the agreement contains an express clause stating so.

Arbitration Vs Mediation Costs

Since mediation and arbitration can be utilized in a variety of disputes, it is not practical to directly compare the overall average expected costs of each.

In theory, arbitration should be less extensive than litigation, given there are few possibilities to appeal an arbitration award.

However, in today’s reality, arbitration may take years and the costs involved are quite high.

There are two main types of costs related to arbitration proceedings:

• the administrative fees for the institution administering arbitration,
• Arbitrator compensation,
• Expenses paid to the arbitrator who decides over the case.

Additional costs may involve expert witnesses and lawyer’s fees.

Depending on the complexity and importance of the dispute at hand, the duration of mediation can vary between several hours, days, or even months.

As a general rule, in most mediations, the parties reach a settlement within 30 days since the dispute has been brought to the attention of a mediator.

As a relatively short process, mediation brings along fewer expenses. On average, a mediator charges between $300-$500 per hour, but this rate can go upper depending on the complexity of the case and the mediator. You can also refer to our article on family disputes mediations for the causes and expected expenses.

In addition, if the dispute is submitted to an official mediation institution (similar to arbitration), this could involve some additional administrative costs.

The post What are the differences between arbitration and mediation? All you need to know about arbitration and mediation appeared first on ODR Guide.

Unfortunately, you may find yourself in the position where you are treated unfairly by Upwork whether in conducting business together or had your user account closed or suspended by them. Account suspension by Upwork could result in the lockdown and loss of money in your account.

If you are confident that your Upwork account has been unfairly suspended by Upwork then you will have no other option but to open a complaint ticket prior to initiating a dispute.

How to open a complaint ticket on Upwork? A complaint ticket can be opened on the Upwork support center to appeal the suspension of your account noting that unless you have strong evidence, your chances of removing the suspension are low.

If you have a substantial amount of money on your account, and could not reopen your account by raising a complaint ticket, then you have no other option but to initiate a dispute. Similarly, if you are in business with Upwork, you will have to initiate a dispute.

So, how to open a dispute against Upwork? To start and open a dispute against Upwork, you have to send an official notice of dispute by e-mail to [email protected] from your registered E-mail address or by writing to their San Francisco address.

What are the estimated fees for arbitration against Upwork? For freelancers located in the USA, the fees of arbitration against Upwork are the lesser of $250 or the fees to be paid if the case is raised in court by the freelancer.

We have also reviewed the Jamsadr.com dispute resolution platform which is the platform used by Upwork and other companies such as Shein and Fiverrr, for resolving claims and disputes. You can read it at Your Quick Guide to JAMS ADR Platform: Mediation, Arbitration, and Dispute Resolution Services. You might encounter these platforms if you are taking a company into arbitration for issues related to the right to repair and company limitations.

Causes for a dispute between you and Upwork

The main reason for a dispute between you and Upwork will be the suspension of your account and the inability to withdraw funds. There are many reasons that may entitle Upwork to suspend your account. There are at least 16 main categories and 30 sub-categories that allow Upwork to suspend your account.

We have gone through Upwrok’s terms and conditions and community forms to summarize the main reasons and most common provisions used by Upwork to justify the suspension of your account.

1. Seeking and supporting activities or services that promot harmeful and lawful activities such as
   • Discriminatory, obscene, and activity that supports child exploitation.
   • Violation of intellectual property “IP”.
   • Assist in cheating or academic ghost writing.
   • Spread of “fake news” and misinformation.
2. Fraudulent or misleading uses or content
   • Manipulating the hours worked.
   • Misrepresenting your skills and experience.
   • Using a fake profile photo.
   • Allowing others to use your account.
3. All kinds of spamming
4. Requesting free services
5. Tampering with Upwork services source code.

There are many other indirect reasons that may cause Upwork to suspend your account. For example, your account can be dormant for a long period of time and when you sign in, Upwork’s “AI” or “security measures” marks your access as fraudulent behavior. This also applies for many other reasons, usually unintentional by you.

So, if you have money your account and received an account suspension that you believe is unfair (ie you did not commit a breach of the terms of service) then you are only left with two options:

How to open a dispute against Upwork

The chances to resolve the account suspension by customer services are low. The only chance your case fets resolved depends if the person reviewing your case is not just an “AI” and is competent enough and willing to go through details.

Otherwise, you will have to open a dispute against Upwork.

For other kinds of disputes, such as those against clients, you will have to settle them within the Upwork platform and as explained briefly below.

For other platforms, please see our article on Freelancer.com,

Dispute process and arbitration against Upwork

When customer service fails and a dispute arises between you and Upwork you will have to attempt to resolve the dispute amicably within 60 Days after issuing your notice.

If no agreement is reached then you will have to resort to arbitration or court.

Keep in mind that the rules and options differ a bit if you are located outside of the United States. Therefore, always note the following:

Governing law

Any claim and dispute will be governed by the laws of the State of Deleware, USA. However, any Claims and disputes by any Freelancer located in the United States will be governed by the state in which the Freelancer lives.

This means that for users out of the US, your claims will be governed by the laws of the state of Deleware. You do not have the option of arbitration via jamsadr.com.

This is a sneaky move by Upwork, more about it in the below sections.

Sending a Notice of Claim against Upwork

Before demanding arbitration of your claim (future dispute), you first have to notify Upwork of the existence of your claim. Similarly, Upwork has to send you a notification in case they have a Claim against you.

To send a notice of claim to Upwork, issue an E-mail to [email protected] via your account e-mail address. You can also send it by writing at “Attn: Legal, 655 Montgomery ST STE 490, DPT 17022, San Francisco, CA 94111-2676.

Make sure to use the word “Notice” in the subject of your e-mail or letter!

Binding Arbitration for USA Upwork users

This section is only applicable for users outside of the United States and its territories.

If you are unable to reach for an amicable solution within 60 days for the issuance (or receipt) of the notice of claim, then as per the terms and conditions, you have to go for binding arbitration before an arbitrator from JAMS instead of Court or Jury.

Since this is a binding arbitration clause, you need to learn more and understand binding arbitration. We have a clear explanation on this topic at What is Binding Arbitration? Is it better than Court?

What is the location of arbitration with Upwork?

The location of arbitration is in Santa Clara County, California in accordance with the JAMS Comprehensive Arbitration Rules.

If the Claim is related to employment or worker classification disputes, the arbitration will be conducted in the state and within 25 miles of where Freelancer is located in accordance with the JAMS Employment Arbitration Rules.

What are the arbitration fees?

The user will pay the lesser of $250 or JAMS arbitration fees based on what would have been paid if the case was raised in the user’s state.

Any difference shall be paid by Upwork.

Can I opt out of Upwork arbitration requirement in the USA?

You can opt-out of the Upwork requirement for binding arbitration by sending an official notification in WRITING within 30 days from the date of registration on Upwork.

You can also send your notice by e-mail to [email protected].

To correctly opt-out of the arbitration clause, your notice must include the following:

• Account username
• Your name
• Your address
• Your Telephone number
• Your e-mail address.
• A statememt stating that you wish to opt out of the Arbitration Provision.

Disputing Freelancers with Upwork Out of the USA

For freelancers out of the USA, you will have to follow the laws and regulations of the state of Delaware. Unfortunately, this severely hinders your ability to dispute against work and will be extremely costly.

Your best option is to try your best to strongly present your case while discussing it with Upwork after serving your notice of claim.

It will be extremely costly and time-consuming to sue them if you are out of the United States. Unless there is a substantial amount of money involved, you do not have other options but to accept the outcomes of your negotiations.

How to present my dispute to Upwork?

Like any claim, you have to present it in a proper and direct way. This should include, at least, the following:

1. Summary of your account information such as name, E-mail,..etc.
2. A brief description of the claim, this includes:
   • The causes, supported by evidence such as screenshots and e-mails.
   • The effects.
   • All relevant communication of the subject of claim. You have to provide all the evidence possible to justify your statements.
   • What excatly you are requesting and why.
3. Your contact information.

As stated earlier, whether you are in the US or outside, you have 60 days to settle the claim informally before proceeding into litigation or arbitration.

Chances for winning disputes against Upwork and is it worth it?

The chances of winning a dispute against Upwork in the US are much higher than if you are out of the US. This is because you have more control over the costs which are estimated to be $250 or less in contrary to those out of the US.

Choosing between legal action or arbitration against Upwork

If you are in the US, you have the option of opting out of arbitration into litigation. However, keep in mind that you have to issue a notice on this subject within 30 days of your registration.

Most probably, you did not think of such notice or even considered looking for it while registering. Unless you are a seasoned lawyer with experience in these issues, you will most likely have to go for arbitration

If you are out of the US, you do not have the option of arbitration.

Is the dispute with Upwork worth my time and money?

If you are located in the United States and have a good amount of money “locked” because of a dispute with Upwork, then it is worth the time and money.

You may attempt to resolve it informally within the 60 days period from your notice, however, if you sense the situation going south, do not hesitate to contact a lawyer or arbitrator on this subject.

If you are out of the United States, it is not worth it if the disputed amount is small. For large sums of money, work on your presence in the United States and contact a lawyer BEFORE issuing a notice so that the lawyer can guide you early on.

The post Upwork Resentment and disputes between you and Upwork. How to win a dispute against Upwork appeared first on ODR Guide.

In recent years a trend toward expansion of arbitration has been noticed. Arbitration is considered to be an attractive alternative to traditional court proceedings due to its features such as privacy, cost-saving, party autonomy, choice of arbitrator, and avoidance of adversarial proceedings.

It is considered a general principle that arbitration may be used to resolve almost any type of claim or dispute concerning legal rights. This has been referred to as a ‘presumption’ of arbitrability.

So, what is arbitrability? Arbitrability refers to disputes that can be settled by arbitration.

However, it is precisely because arbitration is a private proceeding with public consequences that some types of disputes are reserved exclusively for national courts. These proceedings are commonly related to public policy concerns.

The rationale for this is that certain matters are considered to be so important to the operation of justice or the running of the business that they are reserved exclusively to the control of the courts.

If a dispute is not arbitrable, the arbitral tribunal is limited in its jurisdiction and the claim must instead be submitted to domestic courts.

When discussing arbitrability, the most common questions that arise are:

What exactly is arbitrable and non-arbitrable? Who decides on arbitrability? Must the party raise the question of arbitrability or will the arbitrator raise it himself?

These are some of the questions that this blog post will seek to answer. But before dwelling on these substantive questions, you may read more about arbitration in Alternative dispute resolution (ADR) and it’s advantages and disadvantages and What is Binding Arbitration? Is it better than Court?.

I. The concept of Arbitrability

The concept of arbitrability is recognized in the provisions of the New York Convention and the UNCITRAL Model Law. Even though these instruments do not define arbitrability in precise terms nor do they refer to the term as such, they mention disputes capable of settlement by arbitration, which has been interpreted as referring to arbitrability.

In the general sense, arbitrability involves the question of whether a specific category of disputes can be barred from arbitration or whether it belongs exclusively to the domain of state courts.

Arbitrability is related to the law governing the recognition and enforcement of the arbitration agreement.

II. Limits on Arbitrability

Possible restrictions may arise in two different ways: subjective and objective arbitrability restrictions.

(a) Subjective Arbitrability

Subjective arbitrability refers to the personal legal capacity of the parties to enter into arbitration proceedings, including the power to conclude an arbitration agreement.

Certain entities, such as States or State bodies, due to policy considerations involved, may not be allowed to enter into arbitration agreements or may require special authorization to do so.

In the absence of a contractual capacity to enter into an arbitration agreement or be part of arbitration proceedings, the arbitration agreement is invalid, which makes the dispute overall non-arbitrable.

The question of the state’s capacity to enter an arbitration agreement is a matter of public policy”. To put it in opposite terms, subjective non-arbitrability concerns deficiencies in the contractual capacity of a party and it affects the overall validity of the arbitration agreement.

(b) Objective Arbitrability

Objective arbitrability, on the other hand, is related to the subject matter of the dispute.

For an arbitration agreement to be enforceable, the subject matter has to be arbitrable, i.e. it has to be a subject that the state considers appropriate to be arbitrated.

Some states allow any matter to be arbitrated which the parties may freely dispose of.

This is the solution in Belgium, Italy, the Netherlands, and Sweden.

However, since arbitration is a private proceeding with public consequences, some countries impose limitations and restrictions regarding the type of disputes that are suitable for arbitration proceedings.

These disputes are, by reason of their very character, non-arbitrable.

For example, in the United States, the 2017 Arbitration Fairness Act invalidates any pre-dispute resolution clause in relation to employment, consumer, antitrust, or civil rights disputes on the grounds that the weaker parties have little or no meaningful choice as to whether to select arbitration.

In general, non-arbitrable disputes are related to the criminal legal system of a country, such disputes related to bribery, fraud or corruption, but also to paramount national interests, such as natural resources.

Additionally, there is a set of economic-related disputes that some national arbitration practices recognize as non-arbitrable disputes, as follows:

• Patents and trademarks
  • Antitrust and competition laws
  • Insolvency
  • Corporate governance disputes

Each of these categories will be considered separately below:

(i) Patents and trademarks

Patents and trademarks are monopoly rights that only States can grant. For this reason, any dispute related to their grant or validity is outside the domain of arbitration.

However, the owner of a patent or trademark frequently issues licenses to one or more corporations or individuals in order to exploit the patent or trademark; these disputes between the licensor and the licensee may be referred to arbitration.

(ii) Antitrust and competition laws

In general, anti-trust and competition law-related issues are non-arbitrable when the arbitrator is asked to make a decision over which the public authorities have sole jurisdiction under applicable rules.

However, throughout time, the arbitral case law has consistently confirmed the arbitrability of disputes involving antitrust claims.⁷

(iii) Insolvency

Issues of arbitrability arise in respect of insolvency law as a result of the conflict between the private nature of arbitration and the public-policy-driven collective procedures provided for under insolvency laws.

In general, insolvency proceedings are usually in the exclusive jurisdiction of the national courts, and arbitration proceedings should be suspended once these proceedings are opened against one of the parties.

This is in line with the legislation of the European Union, but also with the national systems of English and Argentinian law.

In the U.S., national bankruptcy courts were traditionally reluctant to defer their jurisdiction to arbitrators.

However, this approach has changed over time and courts now look at the type of dispute before them and determine whether there are any core insolvency issues that may deprive an arbitral tribunal of jurisdiction.

(iv) Corporate Governance issues

In some jurisdictions, parties are free to submit corporate governance issues to arbitration.

But this is not the case everywhere. For example, Russian courts decide on the arbitrability of corporate disputes under Russian law.

III. The Law Governing the Issue of Arbitrability

The question of what law governs arbitrability is a complex one, and that the answer to it may depend upon the stage at which it is raised.

If the issue of arbitrability arises, it is necessary to have regard to the relevant laws of the different states that are, or maybe, concerned.

These are likely to include: the law governing the party involved, where the agreement is with a State or State entity; the law governing the arbitration agreement; the law of the seat of arbitration; and the law of the ultimate place of enforcement of the award.

Most commonly, the law of the seat of arbitration will be considered. That is because if the dispute is not arbitrable according to the law of the place of arbitration, the award will be open to setting aside procedures in that country and its enforcement may be excluded in another country.

However, there are exceptions. For example, under the 2017 Arbitration Fairness Act, the validity and enforceability of an agreement to arbitrate is determined by a court, under federal law, rather than an arbitrator, irrespective of whether the party resisting arbitration challenges the arbitration agreement specifically, or in conjunction with other terms of the contract containing such agreement.

The question of arbitrability may be raised at two different stages of the dispute resolution process: the commencement of the proceedings and the recognition enforcement stage, including any proceedings to set aside the award.

Although in the majority of the disputes the arbitrability of the case is raised by one of the parties, the predominant view is that arbitrators have the duty to analyze the arbitrability of disputes and deny jurisdiction if the matter is not arbitrable.

(a) Commencement of the proceedings

The first stage is at the commencement of the process.

A national court may be asked to stay curial proceedings, instituted in apparent contravention of an arbitration agreement.

A stay may be refused on the ground that, according to the relevant national legal system, the dispute is not susceptible to determination by arbitration.

Alternatively, at that point, a national court may be asked to affirm, by some appropriate declaration, or order, the enforceability of an arbitration clause.

Alternatively, the question may be asked before an arbitral tribunal, which needs to determine, based on the principle of Kompetenz-Kompetenz, whether it has jurisdiction over the dispute.

According to the principle of Kompetenz-Kompetenz, an arbitral tribunal is vested with the authority to decide upon its jurisdiction with respect to any given dispute.

In making such a decision, it will inevitably include an assessment as to whether the dispute at hand is arbitrable should such a question arise. In general, when faced with a question of arbitrability, most Tribunals will apply the law of the seat of arbitration.

ln the case Company M v. M SA”, the tribunal considered that if the issue of arbitrability arises at the pre-award stage, the applicable law is that of that governing the arbitration agreement.

(b) Enforcement and Recognition stage

The other point where the question may arise is at the enforcement stage.

Then, the question may arise in one, or more, countries where the award may be sought to be enforced, whether recognition should be refused on the ground that the subject matter of the dispute was not capable of settlement by arbitration under the law of that country.

Article II and V of the New York Convention lay down a uniform rule addressing issues of arbitrability that may arise at the stage of recognition and enforcement of the award.

Under these provisions, issues of arbitrability must be dealt with under the lex loci.

In other words, the party resisting recognition and enforcement of the arbitral award must demonstrate that the subject matter of the dispute is not arbitrable in the place where recognition and enforcement are sought.

UNCITRAL Model Law, in Article 36, mirrors this approach and provides for issues of arbitrability to be determined by the laws of the state where recognition is sought.

In conclusion

Arbitrable disputes are those that can be settled by arbitration and will be ratified by courts if necessary. Non-arbitrable disputes can be only resolved by national courts due to law requirements, public order, and national interest.

Hint: Our worldwide map for arbitration costs can assist you in estimating your arbitration fees.

The post Arbitrability Concept, Restrictions, and the Applicable Law appeared first on ODR Guide.

Cancellation of sports events such as marathons and triathlons is very upsetting to participants as they have been planning and practicing for the event and also, risk the loss of registration fees and other related costs.

The big question on everyone’s mind is, what happens when a marathon or triathlon such as IRONMAN is canceled.

Can I get back my race event registration fees? The chances of recovering all the race registration fees are low. The best option is accepting a postponed entry in an upcoming event. If you do not have that option, minimize losses by accepting the partial refund offered by the race event organizer.

The next thing that will pop into your mind is most likely, that is unfair, what can I do with corporate organizers such as World Triathlon Corporation (Organizer of the IRONMAN triathlon) who canceled my race?.

Can I sue the race organizer? Individually suing the race organizer for canceling the race is not worth your money or time. However, Joining a class action lawsuit is your best and most economic option.

How can I avoid losing money due to race cancellation by organizers in the future? To avoid the risks of race cancellation, buy race cancelation insurance which costs on average $50 – $165, depending on the race fees and category. You will have to claim it separately, but you would recover most of your costs.

Depending on your insurance plan, you will most probably end up with:

1. Full refund, might be subject to some admin charges.
2. Redund of entry fee, less 15% excess. Example; nirvanaeurope insruance terms and conditions.
3. Receive a 75% credit (% depends on plan) to future races of your choosing. Example, Platinum Racing refund insurance option for purchase to cover events cancelled due to Covid-19.

Please keep in mind that most insurers require the event to be at least 15 days from the date of purchase.

For local events with the majority of local participants, you may opt for legal action in small claims court as the governing rules are the local rules which most participants are aware of and share the same risks.

You can read more about the small claims courts processes if you have a similar issue but with local organizers and smaller fees in Small Claims Court in the USA: Facts You Need To Know Before Filing.

You might also consider checking other informative posts for disputes with big corporations such as Upwork at Upwork Resentment and disputes between you and Upwork. How to win a dispute against Upwork.

Sports events basic terms and conditions

If you register for any events such as the IRONMAN race you will have unique terms and conditions that you will have to agree to in order to successfully register for the race. These terms and conditions might vary slightly across different regions, but will most likely consist of the following waivers in favor of the race organizer:

• The race orgainizer has the right to delay, cancel or modify the event – At their will.
• The race orgainizer has the right to delay, cancel or modify the event due to safety concerns.
• The race orgainizer has the right to delay, cancel or modify the event due to acts of god or public disasters.

Is suing the marathon or triathalon race organizer an option?

Suing the race organization, such as World Triathlon Corporation, by yourself is not an option. It is expensive and time-consuming to individually sue a race organizer corporation by yourself.

The costs and fees outweigh the benefits, and most lawyers will not accept the case as its value is probably less than the cost threshold they can accept.

However, you can join in class action lawsuits. More about class action lawsuits below.

My race is cancelled ? what shall i do next?

Depending on your situation, the following scenarios apply:

The marathon or triathalon event is potponed

It is not recommended to initiate a dispute or legal action in this case. While accepting the postponement of your entry, express your concerns and voice all your complaints in writing.

You might be able to extract some more concessions out of the organizers. Usually, first responders are able to extract more from the organizers than those who settle later.

If you can not accept the proposed date, request changing your entry to any similar race. Unfortunately, the terms and conditions of the race give the organizers the right of postponing the race as stated above.

Therefore, your best option is to negotiate any kind of race entry to avoid losing all your money.

I do not have a race cancellation insurance and my race got cancelled

Request and initiate complaints against the race organizers to obtain whatever concessions possible. You will get the most if you voice your complaint as early as possible.

The more the settlement process takes time, the fewer chances you can recover any losses amicably.

I have cancellation insurance, How can I claim my money back?

You will have to contact your insurance agency and fill the necessary forms along with evidence of cancellation, such as E-mails to obtain a payout.

Depending on your insurance plan, you will most probably end up with:

1. Full refund, might be subject to some admin charges.
2. Redund of entry fee, less 15% excess. Example; nirvanaeurope insruance terms and conditions.
3. Receive a 75% credit (% depends on plan) to future races of your choosing. Example, Platinum Racing refund insurance option for purchase to cover events cancelled due to Covid-19.

Class action lawsuit against marathon and race organizers (like IRONMAN)

What is a Class Action lawsuit?

A class action lawsuit is a legal procedure that allows one or more plaintiffs to file a “combined” lawsuit on behalf of a large group of people.

By doing that, the economic barrier and cost preventing a single member of the group who was affected by the actions of the defendant are removed.

In the case of marathon and triathlon race cancellations by the organizer, many of those affected can join in a class-action lawsuit to recover some of the losses they suffered, or at least, force the organization to change the future race policies.

Is the Class action lawsuit worth my time?

Joining a class action lawsuit is worth one’s time as you will not be doing any legal work or follow up by yourself.

You will register your name and information which be subsequently added to the list along with the others making part of the lawsuit.

If the class action lawsuit is won, you will receive the money, less the attorney fees, divided upon all the participants in the list, bearing in mind that lead plaintiffs receive the most money.

How much money will I get from the Class action law suit?

On average, a handful of dollars. Do not expect to recover all your losses or huge sums of money if you win the class action lawsuit against the marathon or triathlon race organizers.

However, you will be able to punish the companies (in case you win the case) and pursue them to change their course.

In the case of the IRONMAN class action lawsuit, it seems that the case is lost in terms of money, but, it has been made very clear to the IRONMAN cooperation that they will have to change their behavior in the future in order to retain participants.

How much will a class action law suit cost me?

In usual situations, the class action lawsuit will not cost you anything. The lawyer firm initiating and filing the class action lawsuit will be paid by getting a bulk share of the money received in case a settlement is reached.

A class-action lawsuit will usually cost you nothing. The lawyer who is filing the class action lawsuit will get his share of the final settlement. They just put your name on the list amongst others and the money is divided up accordingly.

In cases where the event is limited and on a local level, a lawsuit can be initiated in the small courts. More about the Courts systems in USA’s Virtual Courts: Here’s What You Need to Know and in case you are in the European Union and think you have a dispute with an organization, consider raising it as explained in the EU ODR Platform: The Ultimate Guide for Successful Dispute Resolutions.

The silver linning

Due to the strict terms and conditions, it is hard to win a lawsuit against marathon organizers and Triathalon cooperations such as IRONMAN. On a personal level, your best option is to negotiate to postpone your race entry or accepting a partial refund.

Also, in times of uncertainty on travel rules and restrictions, opt for race cancelation insurance. It might cost you up to $50 – $150 more, but you will be able to recover a big portion of your fees.

Please keep in mind that other costs such as plane tickets or hotels might not be covered, therefore, make sure to include them in the insurance policy.

If you can, try adding as much contingency as possible, such as booking in free cancellation hotels or arranging other kinds of insurance.

On a “Class” level, a class action lawsuit will most likely be lost due to the strict terms and conditions but will definitely make an impact on the race organizers.

The post Triathlons and marathons race cancellations, refunds options, and disputes. How to get your money back appeared first on ODR Guide.

The secret to writing a proper construction notice of dispute lies within the details.

Disputes are a part of the construction business. In the unfortunate case, a construction claim is not resolved and escalates into a dispute, this is the article for you.

How to initiate a construction dispute? Usually, an official notice of dispute is issued by the authorized person to the official address of the other party. The stipulations of the contract must be strictly followed to avoid wasting time and resources and to avoid legal nuisance.

You may also refer to our review on Document Crunch, the AI platform, for reviewing contracts with the intent of reducing risks and disputes.

To learn more about arbitration and alternative dispute resolution, please read on Alternative dispute resolution (ADR) and it’s advantages and disadvantages and What is Binding Arbitration? Is it better than Court?

Each project is unique

Each project contract and particulars are unique, therefore, before initiating a dispute, the contract clauses must be reviewed vigorously and strictly followed. For the sake of this article, it will be assumed that the project contract is a typical EPC contract for projects designed by the employer and executed by the contractor.

Also, it will be assumed that the parties are unable to resolve their claims amicably and a dispute is inevitable.

Thus, the FIDIC Redbook will be the point of reference for this article. Please leave a comment or drop us an e-mail if you have a specific question or request on disputes arising out of other forms of contract such as the FIDIC Full spectrum of conditions of contract (Yellow, White, silver,,etc), NEC, and bespoke contracts.

We emphasize the fact that each project is unique and one should be careful when handling a dispute process.

Below is a link for free notice of dispute in editable word format. Do not worry, we do not spam.

As an experienced Claims and disputes consultant, I strongly recommend using proper contractual correspondence and understanding how to present your case. One of the best guides (Amazon Link) on claims effective writing and response, provides excellent support, even if you are not experienced in the topic.

Writing the construction notice of dispute

The first rule of arbitration is not to go into arbitration! Only if all amicable resolution attempts have failed, then escalating the claim/ conflict into a dispute becomes feasible.

A construction notice of dispute must consist of the following, as applicable:

1. Addressing the letter as per the contract.
2. Clear subject line.
3. All attachments (if any, must be numbered and referenced).
4. Letter body and contractual reference.
5. Moving forward.

Directing the notice of dispute

The notice of dispute must be addressed to the other party as per the official address and person specified in the contract.

Most contracts include the address of each party and notice requirements. These might include; sending them by fax or courier, stamping and returning..etc.

From personal experience, many companies fall into the trap of sending the notice of the dispute to the person whom they have been dealing with the most instead of that specified in the contract.

Letterhead and subject

The following basic items must be included (see the free example provided in the link above):

• Date
• Total number of pages
• The total number of attachments.
• Unique reference number.
• Address of the other party exactly as per the contract. Usually consists of the legal company name (no abbreviations!), registered telephone number, P.OBOX, and area location.

TIP

Disputes usually run for some time after the original people invloved in it leave the company or are relocated to other projects. To avoid date confusions, always, use month name format. Example: 13-Nov-2020 .

The full project name as per the signed contract must be added to the letterhead. In addition, the person to whom it’s directed must be added. Example: Attention: Eng. John Smith.

Afterward, the subject must clearly state that this letter serves as notice. Example:

Subject: Notice of Dispute – Contract Agreement Clause 20.1 (Disputes and Arbitration).

Letter body for the construction notice of dispute – Introduction

Start the letter with “Dear Sir” or “Dear Madam”. You may change this as you wish.

Start the letter by referencing the contract agreement along with the contract reference number and signature date. If you have no contract signed, refer to the official document binding the parties together such as a Letter of Award (LOA) or Service work order.

Afterward, refer to the claims officially submitted by you and several discussions or settlement attempts carried out by the parties.

Examples of items to be referenced in the introduction:

• Signed contract agreement.
• Signed LOA or Work Order (If no contract agreement exists)
• Previous letters, E-mails, or even discussions (if no other evidence exists) related to the subject of the dispute. The reference must include the unique reference number of each piece of evidence along with the date, in chronological order.
• Previous meetings regarding the dispute.
• The attempts to previously resolve this dispute amicably.

Letter body for the construction notice of dispute – First Paragraph

Always assume that the person reading the letter is new to the subject and has no idea what’s going on. This will give you the upper hand later on as all your documents will be clearly structured with consistency in the details.

Presenting the case clearly is a big part of the job.

In this section, you will briefly reiterate the contents of the above-referenced items. The purpose of this paragraph is to show how the dispute started, the several letters exchanged on the subject, and what was their purpose.

Letter body for the construction notice of dispute – Second Paragraph

In this paragraph, you should clearly state your demands. Make sure to refer to the letters or e-mails previously issued on this subject. For example:

The party (Which is you), requests the other party (name/ description of the other party) to reimburse the first party as follows:

1. Release of withheld retention money, totaling $1,000,000.
2. Cost compensation as per the below table:

Letter body for the construction notice of dispute – Third Paragraph

In this section, you will briefly sum up the items described above and reiterate your request for the other party to comply with their contractual obligations. Afterward, refer to the contractual grounds to which the dispute is raised in full.

Example (It is a bit tedious but necessary):

Clause 21.6 [Arbitration]

Unless settled amicably, and subject to Sub-Clause 3.7.5 [Dissatisfaction with Engineer’s determination], Sub-Clause 21.4.4 [Dissatisfaction with DAAB’s decision], Sub-Clause 21.7 [Failure to Comply with DAAB’s Decision] and Sub-Clause 21.8 [No DAAB In Place], any Dispute in respect of which the DAAB’s decision (if any) has not become final and binding shall be finally settled by international arbitration. Unless otherwise agreed by both Parties:

(a) the Dispute shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce;
(b) the Dispute shall be settled by one or three arbitrators appointed in accordance with these Rules; and (c) the arbitration shall be conducted in the ruling language defined in Sub-Clause 1.4 [Law and Language].

The arbitrator(s) shall have full power to open up, review and revise any certificate, determination (other than a final and binding determination), instruction, opinion or valuation of the Engineer, and any decision of the
DAAB (other than a final and binding decision) relevant to the Dispute.
Nothing shall disqualify the Engineer from being called as a witness and giving evidence before the arbitrator(s) on any matter whatsoever relevant to the Dispute.
In any award dealing with costs of the arbitration, the arbitrator(s) may take account of the extent (if any) to which a Party failed to cooperate with the other Party in constituting a DAAB under Sub-Clause 21.1 [Constitution of the DAAB] and/or Sub-Clause 21.2 [Failure to Appoint DAAB Member(s)].
Neither Party shall be limited in the proceedings before the arbitrator(s) to the evidence or arguments previously put before the DAAB to obtain its decision, or to the reasons for dissatisfaction given in the Party’s NOD under
Sub-Clause 21.4 [Obtaining DAAB’s Decision]. Any decision of the DAAB
shall be admissible in evidence in the arbitration.
Arbitration may be commenced before or after completion of the Works. The obligations of the Parties, the Engineer and the DAAB shall not be altered by reason of any arbitration being conducted during the progress of the Works.
If an award requires a payment of an amount by one Party to the other Party, this amount shall be immediately due and payable without any further certification or Notice.

Letter body for the construction notice of dispute – The Conclusion

The conclusion consists of TWO parts.

In the first part, state that you intend to carry on with the dispute as per the stipulation referred above if it remains unsolved. This is by stating the body to which the dispute will be referred in accordance with the contract such as DIFC or The American Arbitration Association.

In the second part, give the other party one more chance to settle the dispute.

This is by stating that you are willing, in the interim period, to meet up with the other party to discuss the release or payment of the money claimed by you. It is important to make it clear that you are proceeding with the dispute but will be willing to listen to the other party as you proceed.

Done with the letter, now what?

Contact the experts and make sure all your documentation is in place and readily available in soft and hard copy format. We always advise taking an expert opinion on the merits of your case before issuing a notice of dispute.

All the best!

The post Writing a Construction Notice of Dispute. Free Sample Letter appeared first on ODR Guide.

In the event of a car accident that your company refuses to settle, you basically have two effective options to follow: Litigation or Arbitration.

Taking your car insurance dispute to the courtrooms can be an exhausting experience. It can take up to one year to resolve, if not longer. Moreover, you have the litigation fees, the lawyer’s fee, and other expenses to pay. Together, these expenses might easily take out 50% of the money you recover, if successful.

Arbitration keeps your dispute outside the court and has been proven to cost less money and time compared to the previous option.  

According to Ed Anderson from National Arbitration Forum, “Arbitration can save parties 70-80% of the cost of litigating these cases.”

In arbitration, the dispute is usually solved within 90 days, and the cost of such procedure is inexpensive and usually includes,

“an administrative fee of $150 per party for appointment of a neutral and scheduling of an arbitration hearing or a mediation conference, plus a suggested compensation fee of $300 per day for the neutral arbitrator or mediator, to be paid equally by the parties ($150 per party). The exact compensation rate for the neutral will be agreed by the parties in each case, with the assistance of the AAA.”

(American Arbitration Association, 1989)

You may refer to our car accidents insurances Dos and Donts. For self-driving cars, refer to Everything Tesla: Right to Repair, Car Insurance, and Accident Disputes

What Is Arbitration

Arbitration is a time and cost-effective alternative dispute resolution with which you can settle a disagreement or a dispute outside of courtrooms.

Arbitration brings in a neutral and unbiased third party that can be either an individual or a panel with the purpose of reaching a fair resolution based on the facts that each side provides.

This decision-making third party is called the arbitrator and the decision they issue is known as the award.

The outcome of arbitration, or the award, can be either binding, cannot be appealed or overturned by the court for any reason, and under no circumstance, or nonbinding where you can either walk away with nothing or file a lawsuit.

This is something you should discuss with your insurer before signing an insurance contract or before initiating arbitration. In the case of a car insurance dispute, you should opt for binding arbitration.

Otherwise, the opposing party can easily overturn the award issued by the arbitrator or file an appeal. To learn more about arbitration, read our articles on online and offline arbitration, binding arbitration, arbitration agreement, and the impact of Coronavirus on arbitration.

The Process of Arbitration in Car Insurance Disputes: How Does It Work?

When you suffer a car accident, you expect your, or the at-fault driver’s, insurance company to pay a fair amount of money in compensation for your damages. However, sometimes, this may not be the case and a dispute will arise. Things might even escalate more if the car was defective, therefore, educate yourself more about Lemon Law to take an informed decision at the right time.

In this case, you and the insurer can choose to solve this disagreement through arbitration. This can be mentioned in the insurance contract or requested by either party.

Here’s the step-by-step process:

1- Filing:

The arbitration process officially begins when one party of the dispute files a Statement of Claim via a credible dispute resolution service such as the AAA in the United States. This process can be undertaken online, via the service’s website or email, or offline by email or their local office.

If the insurance contract includes an arbitration clause referring to AAA or ICDRP, the parties should provide this as part of their arbitration initiation process. The clause is usually located

If no such contract or clause is available, a party can initiate the process by approaching the AAA and filling in a Submission Agreement (SA), and the AAA, in turn, will contact the other involved party to obtain their agreement. Likewise, you can contact the other party and fill in a joint SA.

The SA can be found on the AAA’s website.

This SA must include:

• Signatures of the party/parties or their representatives
• names, addresses, and telephone numbers of all parties to the case, along with the insurance-company file or claim number and any court docket number;
• The dispute resolution procedure selected by the parties (in this case it would be arbitration)
• The nature and the amount of the claim (a brief description of the claim and the response of the insurer);
• Limitations, if any, on the neutral’s authority;
• The preferred place of hearing (any AAA regional office or another appropriate location); and
• An administrative fee of $150 per party.

2- Selection and Appointment of the Neutral:

The AAA, or the relevant ADR provider, will appoint an arbitrator based on the area of the dispute, which is car insurance.

The arbitrator is either an attorney or a retired judge who has no financial or personal interest in the controversy’s outcome.

The arbitrator fees are paid prior to the hearing, and they are to be determined by the AAA and the arbitrator himself.

As such, the arbitrator must meet a set of qualifications,

“Prior to accepting appointment, a person being considered for such appointment shall disclose any circumstance likely to prevent a prompt hearing or to create a presumption of bias. Upon receipt of such information, the AAA will either replace that person or communicate the information to the parties for comments. After reviewing any comments received from the parties, the AAA may disqualify that person.”

The AAA and other ADR providers allow more than one arbitrator to hear and decide the case with different options of use. In this case, you and your insurer will each appoint an arbitrator and the AAA will appoint a third who will function as the chairperson.

While the use of more than one arbitrator can enormously increase your expenses, it is advised as a way of making arbitration work for you more efficiently and safely.

Unless the agreement states otherwise, the arbitrator will set the date, time, and place of the arbitration hearing. The AAA will notify the parties at least 10 days before the hearing date.

3- Exchange of Information

Under the arbitrator’s authority, the involved parties can produce documents and identify any witnesses to be called in the hearing. The parties are required to exchange copies of all the documents and information they intend to exhibit at the hearing.

Should a dispute arise concerning or during the information exchange, the arbitrator is authorized to intervene and resolve it.

4- The Arbitration Hearing

The arbitration hearing is usually completed within a day. Parties, representatives, and any person who has an interest in the hearing can attend. The arbitrator directs and conducts the hearing in a fair manner to both parties, and it usually goes as follows, unless stated otherwise:

1. The claimant presents the supporting evidence of his claim.
2. The respondent presents his evidence of his defense.
3. Each party’s witnesses will answer the adverse party’s and the arbitrator’s questions.
4. The arbitrator will decide the relevance of the evidence provided and the materiality of it.
5. The arbitrator then inquires if the parties have anything to add, evidence or testimony.  When everything is concluded, the arbitrator announces the closing of the arbitration hearing.
6. The time limit within which the award will be made is either stated in the insurance contract or agreed upon during the arbitration. This time limit, no more than 30 days, starts immediately after the hearing’s closure.

For a valid and a good cause, the hearing can be postponed by any party, including the arbitrator. The requesting party will be charged a postponement fee of $100.

If a party believes that a rule or a requirement has not been respected or complied with has the right to object.

5- The Award

The award will be written and signed by the arbitrator in compliance with the law. It should include the following:

• The remedy or relief the arbitrator sees appropriate and from such date.
• The attorney’s fees, if authorized by law or requested by the parties.
• Other than the final award, the arbitrator can add decisions such assessment of fees, expenses, and compensations.

In the event of a settlement award, when the parties settle their dispute during the arbitration process, the arbitrator will set the terms of the settlement in what is known as a “consent award”.  Similar to the arbitrator’s award, the consent award must include the fees of arbitration and the arbitrator.

The award, or a true copy of the award, will be placed in each party’s mail. It may also be delivered in any manner that is authorized by law.

This guide summarizes the steps of insurance arbitration. For more details on your rights and duties in an insurance arbitration, check the AAA’s guide, Insurance Claims Dispute Resolution Procedures.

Enhancing Your Insurance Arbitration Experience

The contract you sign with your insurer is crucial to the arbitration experience. The contract must include an arbitration clause where details on the arbitrator and his qualifications are clearly stated.

Furthermore, having agreed to arbitrate any disputes in advance and before a dispute arises, known as pre-dispute arbitration, your costs can be much lower than a post-dispute agreement.

Any other details you consider important such as time limits, fees, and compensation should be discussed or included in the contract.

The importance of the arbitrator cannot be overstated, thus, in the arbitrator appointment phase, make sure you do your research on his background.

When determining the value of your claim, you should consider:

• The present expenses resulting from the accident such as your car’s value loss and repair costs
• Hospital bills
• The lost income or ability to produce income, and
• Your pain and suffering

How to estimate your insurance claims?

Your car’s value loss is the difference between your car’s market value before the accident and its current value after the accident.

Conversely, your pain and suffering are not easily determined as it’s not tangible. To calculate this, you can use the “Per Diem” method where you are compensated a said amount of money for every day or week you suffer from your injuries after the accident.

To calculate the total claim’s value, lawyers and insurers usually multiply the total of your damages (value loss, maintenance, income loss, and hospital bill) by a figure between 1.5 and 6. The generated amount will cover your pain and suffering.

It is important to know that the severity of your damages determines this multiplier. If your negligence or behavior was a leading factor in the accident, this decreases the multiplier too.

In a nutshell, the insurer will always attempt to minimize your damages and pay the minimum possible. Therefore, the stronger your evidence is, the better the money you will recover.

Conclusion

When you go through a dispute with your car insurance company or the at-fault driver’s, you should consider your options carefully. Depending on the circumstances of the incident, you should be able to decide whether to take whatever the insurer is offering, bring your case to court, or arbitrate it.

Overall, arbitration will cost you anything between $750 to $3,500 depending on the number of arbitrators and the whole process, which is 70-80% less than litigation costs. With this procedure, you are able to recover your money within 90 days.

The post Resolving Car Insurance Disputes: The Guide to Successful Insurance Arbitration appeared first on ODR Guide.

What is an Arbitration Agreement? An arbitration agreement is an agreement between the parties to refer a present or a future dispute arising out of a contract to arbitration.

Details about arbitration and ADR methods are extensively discussed in What are the Main Types of Alternative Dispute Resolution – ADR and What is Binding Arbitration? Is it better than Court?

Types of Arbitration Agreement

There can be 2 types of Arbitration Agreements:

1. Arbitration clause in normal contracts: This means that when in the normal contract or agreement for any business or a bank and customer agreement there is an arbitration clause which means that in case of any dispute in future between the parties to the agreement, they should refer it to arbitration.
2. Submission Agreement: This is the type when there is no agreement between the parties and after the dispute arises the parties decides that the dispute should be settled by arbitration.

Purpose of Arbitration Agreement

The purpose of an arbitration agreement is that the disputes should be settled without going to courts and in a timely manner.

Overall, the parties spend less, takes less time and the procedure is more simple in comparison to court litigations. However, It is not without disadvantages. Let us see the pros and cons of an Arbitration Agreement.

Pros of Arbitration Agreement

• Saves precious time of the parties.
• Usually more cost effective than court litigation.
• Flexible for the parties.
• Less complicated than litigaiton.
• Provides confiecntiality and privacy as the proceedings are not open to public.

 Cons of Arbitration Agreement

• Sometimes it becomes expensive than litigation when the dispute is complicated.
• Closes the door for all the other forms of dispute mechanisms.
• Parties often unknowingly sign and becomes bound by the arbitration clause.
• Generally, it is binding and hence the parties have no option but to accept the decision.

More about Arbitration Agreement here and Arbitration costs here.

What an Arbitration Agreement should contain?

The Arbitration Agreement has to be necessarily in writing whether as a clause in an agreement for arbitration or as a separate agreement for settling a dispute via arbitration. The arbitration clause or agreement can never be oral.

A valid arbitration agreement should be in a form of a valid contract and fulfill all the requirements of a contract. It should specify the disputes which would be referred to as arbitration and the dispute should be related to the agreement to which the arbitration clause is the part.

It also specifies whether arbitration would be binding on the parties and how many arbitrators would be there (the number should be odd). The clause also mentions the governing law and jurisdiction.

A simple Arbitration Clause should at least specify the following:

1. Nature of dispute.
2. Number of Arbitrators.
3. Place of Arbitration.
4. Language of Arbitration.
5. Governing Law.

An Arbitration clause can also specify the method of appointment of arbitrator/s, qualification of the arbitrator/s, time taken for deciding the dispute, etc.

An example of a simple arbitration clause:

“Any dispute, controversy, or claim arising under, out of, or relating to this contract shall be referred to and finally determined by arbitration. The arbitral tribunal shall consist of a sole arbitrator, the place of arbitration shall be “name of the place”, the language to be used in the arbitration proceedings shall be “name of language” and the dispute shall be decided in accordance with the “jurisdiction”.

Process of Arbitration

1. The first step is sending a notice by the Claimant to the Opposite side. A notice for initiating arbitration proceedings is sent to the other party by the claimant generally. The notice should include the details of the dispute, the choice of the arbitrator/s if it is be decided mutually and if certain rules have to be followed then the mention of the said rules. The other party should reply to the notice within a certain time and mention of their choice or arbitrator and confirmation to start the arbitration.
2. After the appointment of arbitral tribunal, the nature of dispute is discussed with the tribunal by the parties and the timeline is set for deciding the dispute.
3. The claimant gives his/her claim in writing and this would be followed by a reply from the Defendant, giving of evidence by the parties, cross examination of the witnesses and experts and finally argument by the lawyers of the parties. The time taken for arbitration hearing depends on complexity of the issue and the claim involved.
4. After this the arbitral tribunal decides the matter and gives it verdict which is called the Arbitral Award. The award can or cannot be challenged depending on the nature of the arbitration. If it is a binding arbitration agreement the parties can only go to court and challenge the award on the ground of fraud or cheating by the tribunal.

A Contract with an Arbitration Clause

Any contract which we sign today has an arbitration clause. Before entering into any contract, one should look for the arbitration clause.

Many times people sign the contract without seeing all the clauses and only after signing do they discover that they are bound by the arbitration clauses. In any contract, one should find that how any dispute will be resolved in case it arises in the future.

The advantages and disadvantages of an Arbitration Clause

The benefits depend on the type of contract.

For example, an Employment Contract generally has an arbitration clause which is beneficial for the employers as the employees give away their rights to go to the court and it is found by surveys that the arbitrator generally decides in favor of the employer.

Advantages of an Arbitration Clause

• Fast – Arbitration reduces the time taken to decide a dispute between the parties as compared to litigation which can take indefinite time. The process of arbitration is also simple which also saves time.
• Appointment of Arbitrator/s – If a dispute requires an expert or a specialist from any field, an arbitrator with special knowledge or with experience can be appointed.
• Flexible – The process of arbitration is more flexible than litigation as the parties have more say in the process of arbitration. The parties have more control on the arbitration proceedings.
• Less Expensive – The process of arbitration can be less expensive as it is less complicated and less time taking. The parties can end up spending more in litigation as it requires expert witness and discovery which is expensive.
• Privacy / Confidentiality – Some disputes may involve sensitive topics which the parties will want it to be not leaked in public. The arbitration process involves the disputes to be heard at a private place or an office and only the parties in dispute are present.

Disadvantages of an Arbitration Clause

• Unawareness – Generally the other party signing the contract is not aware of the arbitration clause and becomes bound by it unintentionally. If the clause is binding, it means giving up the right to go to litigation and also the arbitration award cannot be appealed.
• Too expensive – Sometimes the dispute is complicated and the money involved is less, so the arbitration process becomes expensive.
• Biased – Generally the employment contract or the consumer contract is biased and is favorable for the Company.
• Informal Evidence – The procedure of evidence is informal in arbitration proceedings which may result in injustice.

The Common Pitfalls with arbitration clause

• Not all contracts are meant for arbitration – There are many contracts the disputes of which cannot be decided through arbitration. In case of a complex dispute where expert witness is required for deciding a claim, arbitration is not the method to settle the dispute. Therefore, it is advisable to consult a lawyer before signing the contract.
• Arbitration proves costly for the parties sometimes – Parties agreed to an arbitration clause by signing a general contract which has an arbitration clause. The parties should consult a lawyer before entering into a contract in order to know whether all the clauses are as per the subject matter of contract.
• The clause is vague at times – The arbitration clause should be clearly worded which should not cause any confusion in future. The contract should clearly mention in case of dispute in future, the same shall be referred to arbitration and not stating for arbitration as well as litigation. Therefore, the parties should thoroughly read each and every clause of the contract, because this is the only way by which the ambiguities in future can be avoided.

The jist

The Arbitration Agreement has to be necessarily in writing and with clear stipulations and procedures. The nature and location of arbitration along with the number of arbitrators and governing law must be at least clear.

It is always advisable to consult a lawyer and discuss the clauses in the contract or in order to avoid future confusion or misinterpretations.

The post What is an Arbitration Agreement? What is its purpose? appeared first on ODR Guide.