Do lawyers feel the heat from arbitration clauses?

blog Arbitration

Arbitration: A partial solution to runaway legal fees.

I just read an email from the cloud storage service I use. It said there was a change in their agreement with me, some minor things, but most important that from now on I would have to consent to binding arbitration in the event a dispute arises between they and myself. I wrote them back: “good move, I am pleased to agree."

Arbitration clauses, such as this one, are spreading more and more to the dismay of those greedy bastard lawyers, who want to blow up each and every dispute or misunderstanding into a major problem, to guarantee them a fat, cozy living. In another blog I estimate that 1/3 of our lawyers are greedy, insensitive bastards, who would first, encourage you to fight a case that is either unwinnable or can be easily settled, and second, try to soak you for whatever they could by inventing work and papers to file (after doing their “research”). These bums could care less at night when they go home about your unfortunate situation. You are merely a dollar sign to them and they could care less whether you win or lose. Beware of those who ask quickly for a retainer, and mention necessary research.

In arbitration, you and your adversary choose an arbitrator, from a list of qualified arbitrators. You have the opportunity to speak with, or interview, the person beforehand. You each then sit down with that arbitrator, and lay the facts and evidence out before him/her. He/She makes a decision, and both parties live with it. The advantages? You do not need a lawyer as your mouthpiece, saving you $200-400 and more an hour for his/her time. You sit before an impartial person you have had a hand in selecting, who owes nothing to any law firm that supported his selection or election. The arbitrator will generally not allow the submission of time-wasting documents. You are allowed to have an attorney in arbitration, but in small or simple matters you simply do not need one. You have to be able to organize your side of the story, and supporting evidence. If not, a qualified friend can do so, and accompany you to the hearing.

Why are so many companies, especially credit card companies, using arbitration? Because they too are tired of the multi-thousand dollar bills to resolve relatively simple matters. They can send their representative (not a lawyer) to the hearing. Most often the parties in an arbitration, being relieved of the ridiculous legal fees being charges, start a conversation beforehand and can settle things reasonably and simply before the hearing starts. I’ve done that twice.

Here’s an example of a greedy bastard lawyer who almost got his hooks into a friend of mine. My friend advertised a car in a national publication and sold it from New Jersey to a fellow in California. The buyer never came to see the car, but relied on a phone description and wired the money. He felt it was misrepresented when it arrived. He sued in California. My friend panicked, since he had no idea how to defend a case in California. He was never sued before. He went to a lawyer recommended to him. The bum pressed him repeatedly for a retainer of $5,000. He was “confident” he could move the case to New Jersey, but had to do substantial “research” to prepare the papers. Now I know California has a very strict law that disputes such as these cannot be moved out of the state. This lawyer should have, or probably did know that. His aim was to entrap my friend into a long and protracted struggle over the $40,000 car.

If he were decent he would have advised my friend, as I did when he came to me. I told him it was unwinnable, and that any court would eventually tell him to take the car back. I told him to do the same. He agreed. Within two days I had the matter settled, with each side agreeing to pay their respective shipping costs. A decent lawyer would have advised him the same, and maybe charged him $500 for the little work I did to help settle the case.

When a dispute arises, somehow, we are programmed to think “lawyer” immediately. Get that out of your head. Formulate a solution, give a little more than you want to, and call or have a friend call the opponent. You will be surprised how fast you can come to a quick solution. The other guy will normally appreciate your effort. He has the same fear of runaway legal fees that you do!