Intratribunal Relations - Chapter 13 - College of Commercial Arbitrators Guide to Best Practices in Commercial Arbitration - 3rd Edition

The goal of arbitrators who are members of a multiarbitrator tribunal is to conduct their interactions so as to best ensure a fair, expeditious, and cost-effective proceeding and secure for the parties the benefits they sought to obtain when they elected to have their dispute determined by more than one arbitrator.

I. INTRODUCTION

Commercial arbitrators often serve with other arbitrators on multiarbitrator panels, typically composed of three arbitrators. Achieving effective performance of tripartite arbitration panels is not easy, due in part to the tremendous diversity that often attends their use and composition. Such panels are used in a wide variety of arbitrations, including some very large cases and some relatively small cases. Many tripartite arbitrations involve claims involving tens of millions, if not hundreds of millions, of dollars. For a variety of reasons, however, tripartite arbitrations also can involve relatively small sums of money. For example, Rule L-2(a) of the AAA LCC Rules generally provides that when the parties’ contract incorporates the AAA Rules, claims for $1,000,000 or more will be resolved by a panel of three arbitrators unless the parties agree otherwise. This may sound like a substantial sum in the abstract but, in context, not if one considers how quickly costs accrue when three experienced arbitrators and a minimum of two experienced lawyers acting as counsel, along with paralegals and legal assistants, are charging their hourly rates. Moreover, many commercial contracts provide for tripartite arbitration of any dispute arising under the contract, with the result that tripartite arbitrations sometimes involve claims of significantly less than $1,000,000. Indeed, the default under the both the CPR Ad Hoc and Administered Rules is for a tripartite panel, regardless of the size of the claim. See CPR Ad Hoc Rule 5.1; CPR Administered Rule 5.1. In addition, disputes that appear from the original pleadings to involve very large claims might actually involve less for a variety of reasons, including the propensity of some advocates to inflate their assertions of damage. In short, tripartite arbitration may occur in a big case, a small case, or everthing in between.