Constructions of Arbitration's Informalism: Autonomy, Efficiency, and Justice

31 Pages Posted: 30 May 2018

Date Written: May 29, 2018

Abstract

The leading critique of U.S. arbitration, especially in the consumer and employment space, is that it is unjust because of its informalism—for example, because arbitrators are not bound by the rules of evidence or because there is no substantive merits review. Rather than attempt to rebut the charge of injustice head-on, arbitration’s supporters are typically quick to concede it. They focus instead on arbitration’s virtues of autonomy and efficiency—for example, the freedom to design a process tailored to the particular needs of a dispute or the fact that arbitration is generally faster and cheaper than litigation in courts of law.

In this paper, I suggest that arbitration’s informalism is not in itself a reason to conclude that it is unable or unlikely to provide procedural or substantive justice. First, as a philosophical matter, there is no necessary connection between informalism and private ordering on the one hand, and formalism and justice on the other. Second, around the time the Federal Arbitration Act was passed in 1925, arbitration was actually conceived and promoted as a more just alternative to litigation—not despite but rather because of its informalism. Third, I suggest that a common critique of arbitration, that it lacks pretrial discovery, rules of evidence, and appellate review, is not necessarily accurate and does not necessarily establish a deficiency of justice. These procedural accoutrements of public adjudication can enable injustice just as much as they can correct it.

I argue that a conception of arbitration that includes a commitment not just to autonomy and efficiency, but also to justice, will become important as more and more disputes become subject to arbitration. In the age of mass contracting, arbitration supporters will increasingly be called upon to justify how the institution can address concerns about procedural fairness and legitimacy as much as, or perhaps more so than, freedom of choice and the bottom line.

Suggested Citation

Aragaki, Hiro N., Constructions of Arbitration's Informalism: Autonomy, Efficiency, and Justice (May 29, 2018). Journal of Dispute Resolution 141 (2016), Loyola Law School, Los Angeles Legal Studies Research Paper No. 2018-21, Available at SSRN: https://ssrn.com/abstract=3186847

Hiro N. Aragaki (Contact Author)

UC Law, San Francisco ( email )

200 McAllister Street
San Francisco, CA 94102
United States

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