New Disclosure Rules for Accounting and Related Services Arbitrations - Dispute Resolution Journal - Vol. 70, No. 1

Author(s): 

Barbara Mentz

Dan Kolb

Page Count: 

14 pages

Media Description: 

1 PDF Download

Published: 

March, 2015

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Description: 

Originally from Dispute Resolution Journal

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 I. INTRODUCTION

 

A significant concern of accounting and consulting firms and their

clients has been the increasing cost and delay that can result from

unbridled disclosure in arbitration. While arbitration should provide a

simpler, less expensive and more expeditious form of dispute

resolution than court proceedings, too often disclosure in arbitration

has been essentially the same as in court proceedings.

 

 

Recognizing that very legitimate concern, as part of its adoption of

new Rules for Accounting and Related Services Disputes the

American Arbitration Association (“AAA”) has adopted New

Disclosure Rules for the disclosure and production of information in

such disputes (“New Disclosure Rules”). The New Disclosure Rules

are designed to promote balanced, proportional, efficient and focused

management of the disclosure process.1 They hold the promise of

significantly greater efficiency in disclosure while safeguarding each

Party’s opportunity to fairly present its claims and defenses.

 

 

The New Disclosure Rules appear in full in the Appendix.

 

 

The New Disclosure Rules have been designed based on the

conviction that in disputes where professional accounting and related

services firms are Parties it is very often in the mutual interest of the

Parties to avoid steps in disclosure that can, if not controlled,

needlessly inflate the time and cost required to resolve the issues.

Based on that conviction, it is an overriding objective of the New

Disclosure Rules to make it clear that the Arbitrator or Panel of

Arbitrators (herein “the Panel”) has the authority, the responsibility

and the duty to manage the exchange of information among or

between the Parties so as to reduce cost and increase the focus on the

real issues in dispute. The Panel is to do so with due consideration

for proportionality both as to the scope of any request for information

in relation to the likely relevance and materiality of the requested

disclosure and the amount at stake in the arbitration. Expressly

rejected by the New Disclosure Rules is the dragnet approach, where

the objective is to sweep in anything and everything that can be

thought of as conceivably relevant.