Hot Topics for Arbitrators and Best Practices

Arbitrator and best practices for hearings

On February 4, 2021, Kyle-Beth Hilfer spoke on a panel for the New York State Bar Association discussing hot topics for arbitrators and best practices. The hot topics came from the NYSBA Resolution Roundtable blog. Below are some of the hot topics for arbitrators and best practices that Ms. Hilfer discussed on this panel.

Arbitrator Questions and Research:

In the past, arbitrators tended to be more inscrutable. In recent years, the trend has been to arbitrators asking questions to witnesses.

Best Practices: An experienced arbitrator will not interrupt the flow of testimony. She will reserve the bulk of her questions until after counsel has completed direct and cross examination. When considering what questions to ask, the arbitrator should exercise caution in introducing a new line of questioning or a new legal theory. It is the parties’ case, and their attorneys may have chosen to avoid certain topics for strategic reasons. Nonetheless, the arbitrator should ensure that she is serving the parties’ interests. She needs to ensure she fully understands the testimony being presented and the parties’ arguments.

To this end, many arbitrators debate whether to conduct independent research if they know it will help them reach a decision. While arbitrators and best practices vary here, the prevailing belief is not to do independent research. Again, it is the parties’ case. They may have had strategic reasons for not raising a defense or a case. At the same time, the arbitrator cannot “unknow” what she knows. If the arbitrator happens to know of a relevant case on point,  it may be acceptable to ask both parties to brief the case. The arbitrator should consider the case’s relevance and saliency before raising it with the parties’ counsel. She should also consider if it introduces new lines of defense to the case at hand before bringing it up to counsel.

Bifurcation of Cases:

Rule R-32B of the American Arbitration Association Commercial Rules allows arbitrators to bifurcate a case in their discretion to promote expedited resolution of the matter at hand. Cases may be ripe for bifurcation if there are separate determinations to be made on jurisdiction, unrelated claims with the possibility of early disposition, multiple defendants, or complex damages evidence.

Best Practices: Arbitration panels should consider whether bifurcation will result in a material reduction or elimination of proceedings. If a jurisdiction determination would result in a change of claims or cessation of hearings, the matter may be a good candidate for bifurcation. If a determination on liability on one claim would eliminate several other claims and lengthy new testimony, the panel might also consider bifurcation. It also may be useful to bifurcate the hearings around liability and damages if the evidence related to both is not intertwined. In evaluating these issues, the arbitration panel should also consider how bifurcation might affect discovery, expert reports and testimony, and overall costs and timetables for the parties.

At the same time, the arbitration panel should consider the parties’ wishes regarding bifurcation. In most instances, at least one party will not favor bifurcation. The panel should listen carefully to that party’s objections and act with caution in ordering a bifurcation over reasonably legitimate concerns.

Attorneys’ Fees:

Arbitrators and best practices also vary when it comes to considering awarding attorneys’ fees. On the one hand, if a party is not found to be a prevailing party, the arbitrator may not need to receive that party’s fee information. On the other hand, waiting to hear evidence on attorneys’ fees may prolong the case.

Best Practices: At the first preliminary hearing, the arbitrator might discuss the issue of attorneys’ fees and whether they would be available to a party in the instant case. If so, the arbitrator could instruct the parties’ counsel that they should be prepared to submit their attorneys’ fees within several days of the closing of the hearing. In this manner, the parties should be prepared to make this submission without facing undue hardship.

At the same time, as the case progresses, arbitrators should consider whether the case merits full briefs on the issue of attorneys’ fees. If so, the arbitrator may issue an interim award on liability before accepting such briefs.

Social Media Disclosures:

While certain arbitrators may completely steer clear of social media, there are many arbitrators who are active for professional purposes. They need to consider carefully how to run conflicts checks when accepting a case and make disclosures.

Best Practices: Before accepting a case, an arbitrator who is active on social media should conduct searches on the relevant social media platforms to determine if she is connected with any of the parties or witnesses or counsel in a case. She should fashion a disclosure explaining her activity and her connections, regardless of what her search finds. She should also remember that the obligation to disclose any connection is ongoing throughout the pendency of the matter.

In addition, it is important to note that disclosure is a two-way street. The parties also have a continuing obligation to inform the arbitrator at any point in the case should they discover any connection to the arbitrator. The arbitrator should remind parties’ counsel of this obligation throughout the case so as to protect the ultimate award from challenge.

Video Hearings and Technology:

Video hearings are becoming commonplace during the Covid-19 pandemic. Arbitrators have the authority to order video hearings pursuant to the American Arbitration Association rules. Courts have even issued opinions upholding the legitimacy of video hearings.

Best Practices: If a party is objecting to a video hearing, the arbitration panel should consider whether there are any legitimate due process concerns. In their absence, it may be justifiable to order a video hearing over objection to serve efficiency.

Once the pandemic ends, it is likely that arbitration will still use technology for hybrid hearings or fully virtual hearings. Arbitrators have an obligation to ensure they stay current with technology and are prepared to use it to its fullest advantage. They also have an obligation to understand how to use technology to preserve confidentiality, security, and efficiency. At the same time, the panel should have contingency plans in place for technology failures that have been discussed ahead of time with the parties.

It is also worth noting that advocates have similar obligations with regard to technology. Counsel should not object to the use of technology that enhances efficiency without sacrificing the ability to obtain a fair and unbiased hearing.

Arbitrators and best practices may vary depending on style and philosophy. Kyle-Beth Hilfer is well-known as an arbitrator who implements these best practices. She is available to serve as an experienced arbitrator or mediator in your dispute. You can read more about her dispute resolution practice here.