AT&T Mobility and the Future of Small Claims Arbitration
Pace Law School
June 1, 2012
Southwestern University Law Review, Vol. 41, 2012
Small claims arbitration has not received much attention from dispute system designers and scholars. Several coalescing developments require a reassessment of the small claims arbitration process: (1) the Supreme Court’s strong endorsement of the Federal Arbitration Act and arbitration as a favored dispute resolution mechanism, (2) the proliferation of pre-dispute arbitration clauses in consumer products and services agreements, (3) the judicialization of arbitration, and (4) most recently, the Court’s condemnation, in AT&T Mobility v. Concepcion, which held that the FAA preempts a California rule that declared class arbitration waivers in consumer contracts unconscionable, of class arbitration as a procedural device to resolve aggregable yet arbitrable low dollar value claims. The article describes the primary features of the two options remaining for the Concepcions – small claims court and small claims arbitration, as well as their perceived advantages and disadvantages. The article also examines whether simplified arbitration is a fair method of resolving small arbitration claims, and explores other dispute resolution models for resolving small dollar value commercial disputes, including on-line dispute resolution, telephonic arbitration and a small claims arbitrator. The article concludes by urging dispute system designers to consider changing the default mechanism of arbitrating small claims cases from paper or “desk” arbitration to a live hearing before a small claims arbitrator.
Number of Pages in PDF File: 39
Keywords: arbitration, small claims, dispute resolution, dispute system design
JEL Classification: K40Accepted Paper Series
Date posted: July 19, 2012 ; Last revised: December 12, 2012
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