New California Law May Help if You Need to Appeal an Arbitration Decision

photo-arbitration-record-300x200An arbitration is an alternate dispute method that’s becoming increasingly popular and controversial. Thanks in part to that controversy Governor Brown signed into law in October a bill allowing a party to have a certified shorthand reporter transcribe any related proceedings. This may help in case a party wants to challenge the arbitration decision in court.

An arbitration is essentially a private trial.

  • A single arbitrator or a panel of arbitrators normally sit as judge and jury in the case. They are normally practicing attorneys or retired judges.
  • While court proceedings are governed by rules of civil procedure, statutes and state or federal Constitutions arbitrations have far fewer limitations. The rules of an arbitration are agreed to by the parties.
  • The proceedings may be kept confidential and the ability of the parties to obtain evidence from each other can be limited.
  • An arbitration agreement can also require something that normally doesn’t happen in a trial, the losing party may be responsible for the winning party’s legal costs and fees.

Another twist for arbitrations is that a decision is very difficult to overturn in court.

  • Generally courts don’t want to be bothered unless there is evidence the arbitration agreement is unenforceable or something extremely improper occurred during the arbitration.
  • Having a record of proceedings could help a party show that due to mistakes during the proceedings the arbitration decision should be overturned.
  • A court might presume proceedings were done properly without a record being created while a record could show that they were not.

The shorthand reporter could transcribe any deposition, proceeding or hearing and create an official record. It was written by state Senator Bob Wieckowski who said that increasingly consumers are being bound by binding arbitration agreements simply by purchasing goods or services so this is a way for a party to at least get a record of what went on.

It’s not just consumers who are subject to arbitration agreements. By contracting with another business you may be bound to one too. One of the landmark U.S. Supreme Court decisions supporting the use of binding arbitration agreements involved a dispute between a restaurant and a credit card company. If you use contracts you might consider using an arbitration cause so in case of disputes between your customers, contractors or suppliers the issue would be addressed in arbitration which generally takes less time and is less expensive than litigation.

The new law requires a party wanting a certified shorthand reporter to make the request to the arbitrator and the party would have to pay for the costs, unless the person is considered indigent and involved in a consumer arbitration.

If that request is refused by the arbitrator the party can ask a court for an order to require the arbitrator to grant the party’s request so a transcription of any deposition, proceeding or hearing can be created and for an order to delay any deposition, proceeding or hearing until the court decides what to do with the request.

If your company wants to learn more about arbitration, whether it should be part of contracts your company enters into or you want representation in an upcoming arbitration, contact our office so we can talk about the situation and what we can do to help.