AAA Commercial Rules

AAA commercial rules are governed by the AAA, also referred to as the American Arbitration Association. The AAA is a nonprofit organization that provides rules and guidelines regarding alternative dispute resolution (ADR). The organization also provides services to companies who want to resolve conflicts out of court. There are several rules in place that must be followed when entering alternative dispute resolution. Some of the well-known rules include those addressing preliminary hearings, the role of the arbitrator, the discovery phase during the ADR process, and enforcement orders.

Rule R-21

Rule R-21 addresses how a preliminary hearing is held. The rule itself states that the parties should attend such hearings with legal counsel to address the underlying issue in dispute. The rule further states that a preliminary hearing can help enhance the communication between the parties, and might even be an attempt to prevent ADR altogether.

R-21(b) references procedures for issues to be discussed in the preliminary hearing. This will be used as a checklist during the hearing to ensure that all appropriate items are discussed before conclusion of the hearing. This will also help both sides, including legal counsel and the AAA arbitrator to properly identify the issue(s) at hand and decide what can be done to mitigate the problem and prevent additional ADR.

Rule R-22

This rule allows the arbitrator great flexibility in what documents will need to be exchanged during the dispute resolution process. The arbitrator will also determine when the documents will be due. This rule will help organize the process, as the process of ADR is meant to be more efficient than litigation. This rule also places certain limitations on discovery, including documents that are relevant and material to the outcome of the dispute. This standard is narrower than that of the sister rule for litigation procedures (Federal Rules of Civil Procedure 26(b)).

Rule 22 also reduces any unknowns on what type of documentation will be produced at the hearing due to the fact that it requires both parties to disclose to the other party what documents will be used during the hearing.

The rule also specifies that the arbitrator must manage the discovery process so to promote equality of treatment amongst the parties involved and allow both parties to fairly represent their argument and defenses.

Rule R-23

Rule R-23 provides language stating that arbitrators will have enforcement authority and the ability to issue orders that are necessary for a fair outcome. Such powers include the following:

  • The arbitrator can issue orders requesting confidential information of one or more of the parties
  • The arbitrator can impose search parameters for electronic and non-electronic documents
  • The arbitrator can charge fees for document production requests
  • The arbitrator can bring an action against a party for willful non-compliance with an order that he or she previously issued
  • The arbitrator can issue an enforcement order if appropriate

Dispositive Motions

Under rule R-33, the arbitrator can make rulings and motions, including dispositive motions. The AAA rules were previously silent regarding such motions; however, as dispositive motions have become more common in the ADR realm, this new rule provides for greater authority on the part of the arbitrator in issuing these motions.

While this new rule allows the issuance of dispositive motions, the AAA also tries to limit its use to situations when the motion would help resolve the dispute or reduce the issues at hand. An example of this would be a motion that identified an issue of law, i.e. statute of limitations. A dispositive motion would be appropriate in this situation. However, a motion regarding an issue of fact, i.e. indicating that the other party is lying, would not be an appropriate use of this motion.

This rule also states that the arbitrator can make additional rulings if he or she determines that the moving party has proven that the motion will succeed by either resolving the case or narrowing the issues of the case. Therefore, this appears to be a two-step process in which the arbitrator must first identify whether or not the motion will resolve the dispute altogether, and if not, whether or not the motion will reduce the number of issues in dispute.

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