Chapter Four: Arbitrator Fees and Expenses - CCA Guide to Best Practices in Commercial Arbitration - Fourth Edition
Editor A. Holt Gwyn is recognized in the United States and Latin America for his arbitration and mediation practice. His ADR practice complements his legal practice, which is concentrated in construction, environmental, and business contracts and disputes. Mr. Gwyn has coauthored several books and is the author of more than two dozen articles on construction and environmental topics and on resolution of disputes by arbitration and mediation.
Mr. Gwyn has served as Chair of the world’s largest organization of construction lawyers, the ABA’s Forum on Construction Law. In 2014, he received the Forum’s highest achievement “Cornerstone” award. He is a Fellow and in 2016–2017 served as President of the American College of Construction Lawyers. He is also a Fellow of the College of Commercial Arbitrators and a Chartered Arbitrator and Fellow of the Chartered Institute of Arbitrators, London, England.
Mr. Gwyn is a founding member of and former Chair of the Section of Construction Law, North Carolina Bar Association. He is a Charter Member of the N.C. Academy of Superior Court Mediators. He has served as arbitrator on many AAA, ICDR, ICC, and CPR administered arbitrations and also serves on the AAA’s Construction Mega Panel and Large, Complex Case Program Panel of Arbitrators and Neutrals; he is included on the CPR International Institute Distinguished Panels of Neutrals, including its Environmental and Construction Panels. For more than a decade, he has been regularly listed in Best Lawyers in America, Super Lawyers (Corporate Counsel Edition), and Who’s Who in American Law.
From 2007 to 2014, Mr. Gwyn was the Editor in Chief of the Journal of the American College of Construction Lawyers, published by Thomson-Reuters-West. From 1996 to 2004, Mr. Gwyn served as a Charter Trustee of North Carolina’s Clean Water Management Trust Fund.
He is a graduate of the University of North Carolina, Chapel Hill (BA 1971) and Wake Forest University School of Law (JD 1976).
Editor Laura A. Kaster comes to her work as a full-time arbitrator and mediator from a background first as a litigation partner at Jenner & Block and then as Chief Litigation Counsel for AT&T, where she also represented AT&T Labs and was responsible for all of AT&T’s arbitrations (including complex insurance matters), IP litigation, and all appeals in complex litigation and employment matters. Her work as a neutral is modeled on her admiration of the work of Judge Frank M. Coffin of the First Circuit Court of Appeals for whom she clerked following law school. From 2015 to 2017, she was the President of the Justice Marie L. Garibaldi ADR Inn of Court, the first ADR Inn in the country. She is also a past Chair of the NJSBA Dispute Resolution Section and a Co-Editor in Chief of the NYSBA’s journal, Dispute Resolution Lawyer. She is the 2014 recipient of the NJSBA’s Boskey Award for the ADR practitioner of the year. She has served as an arbitrator, including as chair, in complex commercial, telecom, biotech, patent and trademark licensing, partnership and development and family business disputes, and in matters involving the sales of businesses and securities claims. Ms. Kaster has served as a mediator in more than 200 matters, including matters involving hundreds of millions of dollars and long-running disputes. She was a founding member of the Executive Committee of the NJ Academy of Arbitrators and Mediators and is on the Roster of the National Academy of Distinguished Neutrals. She is on the Tech List of the Silicon Valley Arbitration and Mediation Center and is an arbitrator for the AAA; for the CPR on its Telecom Panel, E‑Discovery Panel, Technology Panel, New Jersey at Large ADR Panel, and Trademark Panel; and for FINRA. She is a hearing officer for National Arbitration and Mediation (NAM), a member of the Global Panel for the Center on Dispute Resolution (CEDR), and a mediator for the Global Mediation Exchange Center. She is CEDR accredited and an IMI Certified Mediator. She is a master mediator for the AAA. She has spoken and trained widely for the AAA/ICDR conferences, CCA, PLI, ABA Dispute Resolution Section annual meetings, NJSBA, NJAPM, NYSBA, and NJICLE. Ms. Kaster is listed as only one of three New Jersey mediators in Who’s Who Legal: Mediation (2016–2017). She is an Adjunct Professor of ADR at Seton Hall Law School and an organizer of the mediation program and training for the New Jersey Bankruptcy Courts. She mediates for the New Jersey and New York Commercial Courts and is a member of the New Jersey Supreme Court’s Committee on Complementary Dispute Resolution and its Advisory Committee on Mediator Standards. Ms. Kaster has published widely on both arbitration and mediation. She is a coauthor of the forthcoming chapter “Arbitrating Technology Cases: Considerations for Businesspeople and Advocates” in Harrie Samaras (Ed.), ADR Advocacy, Strategies, and Practices for Intellectual Property and Technology Cases (ABA 2017). She graduated from Tufts University with a BA and received her JD magna cum laude from Boston University Law School, where she received the Melville Bigelow award for “the greatest promise as a teacher and scholar of the law.” She is a member of the New York and New Jersey state bars and a proud Fellow of the College of Commercial Arbitrators.
John T. Blankenship, Franklin, Tennessee/Sparta, Tennessee
Louis Coffey, Philadelphia, Pennsylvania
Philip E. Cutler, Seattle, Washington
Neal M. Eiseman, New York, New York
Allison J. Snyder, Houston, Texas
Curtis E. von Kann, Washington, DC
Arbitrators should reach and memorialize clear agreements with all parties concerning payment for their professional services and expenses, invoice the parties in accordance therewith, and promptly inform the parties when fee estimates need to be revised.
I. ARBITRATOR FEES
A. The Importance of Clear Initial Agreements
It is important that the agreements and understandings between arbitrators and parties regarding billing rates, deposits for the payment of arbitrator fees and expenses, and disbursements from deposited funds be clear from the outset of the arbitral proceeding.
Issues concerning arbitrator compensation and reimbursement for expenses are inherent to the arbitration process and must be addressed by both the parties and the arbitrators. Many of the difficulties encountered in this area usually can be averted by employing due care and transparency from the very beginning of the arbitration process.
It is critically important for arbitrators and administering organizations to memorialize, in writing at the outset of the arbitration, the parties’ agreement to all terms and arrangements for professional services, including (1) the rate at which arbitrators will be paid for hearings and for work outside of hearings, (2) when invoices will be issued and when payment is due, (3) amounts that may be charged if the hearing is cancelled or postponed and how far in advance a hearing may be cancelled or postponed without incurring such charges, and (4) amounts to be charged by the arbitrators or an administering organization for case administration, including the initial allocation of all charges among the parties. In administered cases, these understandings normally will be reached in communications in which the administering institution serves as an intermediary between the arbitrators and the parties. In nonadministered cases, the communications will be directly between the arbitrators and the parties.