2004 Code of Ethics for Commercial Arbitrators Explained - Chapter 22 - AAA Handbook on Arbitration Practice
Bruce Meyerson, a mediator and arbitrator in Phoenix, Ariz., is a former judge of the Arizona Court of Appeals and a past chair of the ABA Section of Dispute Resolution. He participated as a member of the ABA delegation on the 2004 revision of the 1977 AAA-ABA Code of Ethics. He is an adjunct professor at the Arizona State University College of Law where he teaches ADR courses, including the course on Arbitration.
John M. Townsend is a Washington, D.C., partner of Hughes Hubbard & Reed LLP, where he chairs the Arbitration and ADR Group. He is currently the Chairman of the AAA’s Board of Directors. He served as a member of the AAA delegation during the 2004 revision of the 1997 ABA-AAA Code of Ethics.
More than a quarter century ago, a small group of arbitrators and practitioners, representatives of the American Bar Association and American Arbitration Association, met over a long weekend, under the leadership of Judge Howard Holtzmann, to draft an important statement defining ethical duties for arbitrators in commercial disputes. Their effort became the 1977 AAA-ABA Code of Ethics for Arbitrators in Commercial Disputes (the 1977 Ethics Code). It has proved to be an invaluable ethical framework for arbitrators and others involved in the dispute resolution field.
Many federal and state courts have cited the 1977 Ethics Code with approval as providing the preeminent definition of standards of conduct in the field. The Seventh Circuit was careful to note, however, that the Code does not have the force of law: “Although we have great respect for the Commercial Arbitration Rules [of the AAA] and the Code of Ethics for Arbitrators, they are not the proper starting point for an inquiry into an award's validity .... The arbitration rules and code do not have the force of law."3
Becasue the practice of arbitration has developed significantly since 1977, committees of the ABA and representatives of the AAA began to review whether changes in the laws governing arbitration, in increasing globalization of commercial transactions, and changes in the public perception and expectations of arbitration required revisions to the 1977 Ethics Code. The ABA efforts were aided by representatives of the International Institute for Conflict Prevention and Resolution (CPR), the College of Commercial Arbitration, and the National Arbitration Forum.
After several years of study and negotiations, agreement was reached by a joint ABA-AAA working group on a proposed revision (the 2004 Revision).4 The Executive Committee of the AAA Board of Directors approved the 2004 Revision as its September 2003 meeting, and the ABA House of Delegates approved the revisions at the ABA Mid-Year Meeting in February 2004.5 The 2004 Revision preserves the style and format, and much of the language, of the 1977 Ethics Code. It is called a revision, rather than a new document, to signal its continuity with the many unchanged provisions of the 1977 Ethics Code and respect for the degree of judicial acceptance that it has achieved. All provisions of the 2004 Revision are subject to any contrary principles that may be found in governing law or applicable arbitration rules and also to the right of the parties to any arbitration to reach agreement on different rules and standards.