Arbitration: An Effective Means to an End during COVID-19

Butler Weihmuller Katz Craig LLP
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Butler Weihmuller Katz Craig LLP

These critical times of isolation and social distancing have proved to be difficult on many areas of the economy. The legal industry is certainly no different. Those in litigation can be hit the hardest by delay and the inability to pursue a quick and efficient resolution. This is especially true of subrogation matters. No longer are hearings easily coordinated and set, allowing the parties to have a short matter discussed and resolved by in person appearances of counsel. The Courts are dealing with a log jam of issues (and in some cases the judges are being ordered to stay away from their own courts), and certain matters like subrogation can simply be pushed aside.

Coordinating a hearing is not necessarily done with ease and efficiency as the judges’ dockets can be overwhelming, especially after they are allowed to re-open. Jury Trials? Forget it. In many areas of Florida and other parts of the country, civil trials may not be set until 2021 (and possibly farther out). As a subrogation attorney, we are sometimes confronted by the notion that we are not litigating “critical matters”, such as those based on constitutional, criminal or civil rights issues. If you have a judge who handles some of these critical matters (as many of them do), dispositive motions and jury trials in subrogation cases may simply get pushed aside indefinitely. This is where the decision to go to arbitration may be an effective means of an end resolution in subrogation.

Depending on the case and contract that is subject of the dispute, arbitration may be a requirement. Of course, those parties to the contract can ultimately waive that requirement or come up with some variant of their mutual choosing. Conversely, in matters absent an arbitration provision in a contract, the parties can voluntarily agree to go to arbitration. Although it can be initially expensive depending on which option you choose, it may assist in advancing civil cases towards a resolution during these times where jury trials are non-existent. Many arbitration provisions in a contract will award the reasonable attorneys’ fees and costs to the prevailing party, alleviating some of the concerns regarding these costs, while also promoting a resolution between the parties. This can certainly be effective when the argument between the parties is based on damages, and not liability.  

Arbitrations consist of one to three arbitrators who act as the judge and the trier of fact. The arbitrator(s) assists the parties in a quick resolution in a number of ways, but most notably by limiting the scope of discovery. This can occur by limiting the written discovery, as well as limiting the number of depositions that are allowed. Arbitrators have many of the same enforcement powers of a trial judge, but often with the benefit of more flexibility.

For the most part, arbitrators do not have caseloads as large as most civil judges, and therefore, can assist in setting periodic status conferences or resolving disputes that arise before the Final Hearing. These disputes can often be resolved within a few days of notice to the arbitrator (sometimes by a quick email). This is certainly more effective and efficient than setting a hearing with the Court during these times—which could take several weeks, and in some cases longer.

Before the pandemic, most of the status conferences and disputes heard by an arbitrator already occurred through telephone conference or other remote means of communication. These current times have not changed the narrative. Lastly, and perhaps most conveniently, many arbitrators are willing to conduct Final Hearings during these times, and some are even permitting the Final Hearings be done via video conferencing—depending on the parties’ wishes. This can certainly be convenient for all those involved.

In short, the decision, or even obligation, to arbitrate a case may save the parties valuable time and costs. Now more than ever it may be a more effective and efficient means to reach the ultimate goal: resolution of the issues between the parties.  All subrogating parties may want to at least consider raising this option with the defense before filing a normal civil lawsuit.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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