Beruflich Dokumente
Kultur Dokumente
SCHOOL OF L. WORKING
No. 3, 2001,
available at <http://www.bu.edu/law/faculty/papers/HyltonK040601abstract.html> (Provides an economic analysis
of motivating factors for franchising parties to include arbitration clauses in their agreements. Presents empirical data
supporting premise that contracting parties choose forum for
PAPER SERIES, L. AND ECON., WORKING PAPER
128
Fall 2002
J. TORONTO
dispute resolution that maximizes difference between deterrence benefits-defined as avoided harms net of avoidance
costs-and dispute resolution costs. Concludes that: (1) view
that arbitration generally involves coercive forfeiture of legal
rights is weak in franchise context, where both parties are
businesses represented by counsel and both have incentive to
choose dispute resolution forum that offers the greatest deterrence benefit per dollar invested; and (2) certain laws that
make arbitration less attractive, such as state franchisee protection statutes, may have substantial wealth effects.).
Edward Wood Dunham, Flatter, Will Get You Nowhere,
20 FRANCHISE L.J. 103 (Winter 2001) (Editorial comments
identify reasons for the enforcement of arbitration clauses in
franchise agreements, including the following: (1) franchisees are businesspeople-not vulnerable, helpless consumers-pursuing entrepreneurial opportunity; (2)
franchisees receive detailed presale disclosure regarding a
franchisor's dispute resolution history and mandated procedures; (3) franchisees' failure to read plain contractual provisions, where applicable, should not relieve franchisees; and
(4) franchisees can choose from competing franchise systems-many of which do not mandate arbitration. Argues
that arbitration is beneficial to franchisees based on: (a) lack
of meaningful discovery, dispositive motions, rules of evidence, and appellate review; (b) certain arbitrators' disdain
of big business; and (c) arbitrators' focus on equity (including compromise awards), rather than the law.).
Jean R. Sternlight, Protecting Franchiseesfrom Abusive
Arbitration Clauses, 20 FRANCHISE L.J. 45 (Fall 2000) (Criticizes use of arbitration clauses by franchisors as means of
securing unfair advantages with respect to franchisees. Disagrees with Professor Drahozal's conclusion that arbitration
clauses, even so-called unfair clauses, may in fact secure
advantages to franchisees as well as franchisors, as franchisors pass certain gains to franchisees. Suggests that franchisees lack the "perfect information" requisite to make the
market function efficiently, and thus that franchisors will not
necessarily share their gains with franchisees. Invites legislators to take action by enacting protective legislation.). (See
also Jean R. Sternlight, Fighting Arbitration Clauses in
FranchisorContracts,TRIAL, Oct. 2000, at 65.)
Ted P. Pearce, Ronald K. Gardner, and Robert L. Zisk, A
Critical Look at Alternative Dispute Resolution, 1 INT'L
FRANCHISE ASSOC. LEGAL SYMP., at Tab 7 (2000) (Provides
overview of mediation and arbitration through the eyes of
franchisee lawyers, franchisor lawyers, and in-house counsel.
Discusses: (1) how arbitration differs from litigation; (2)
advantages and disadvantages of arbitration; (3) drafting suggestions for arbitration clauses; and (4) how franchisors and
franchisees view arbitration.).
Barry M. Heller and Allan P. Hillman, Essentials of Dispute Resolution for Business Lawyers, 1 ABA FORUM ON
Fall 2002
129
513 U.S. 265, 115 S. Ct. 834 (1995), in which Court held
that the FAA governs all arbitration agreements affecting or
involving commerce. Concludes that the Court's decision
"guarantees that if a contract involves or affects interstate
commerce, the pro-arbitration standards contained in the
FAA will govern the enforcement of an arbitration provision
in the contract" and that the "[p]arties submitting to arbitration will no longer face the legislative barriers of differing
state standards or the judicial hostility against the enforcement of arbitration clauses.").
Megan P. Davis, Comment, From ProceduralLaw to Preemption: The Supreme Court's Transformationof the Federal
Arbitration Act, I HARV. NEGOTIATION L. REV. 169 (1996)
(Criticizes Allied-Bruce and the Court's affirmation of supposedly flawed cases leading up to it. Discusses historic evolution of FAAs preemptive power over state law.). (See also
Lauri Washington Sawyer, Allied-Bruce Terminix Companies v. Dobson: The Implementation of the Purposes of the
FederalArbitrationAct or an Unjustified Intrusion Into State
Sovereignty?, 47 MERCER L. REV. 645 (1996).)
Donald E. Johnson, Recent Decision, Has Allied-Bruce
Terminix Cos. v. Dobson ExterminatedAlabama's Anti-Arbitration Rule?, 47 ALA. L. REV. 577 (1996) (Examines relevance of Allied-Bruce and its potential impact on state
arbitration law. Considers how expansion of FAA may
impact consumer protectionism. Concludes that Allied-Bruce
"effectively signals the end of presumptive unenforceability
of predispute arbitration agreements in Alabama.").
Joseph T. Mclaughlin, Arbitrability: Current Trends in the
United States, 59 ALB. L. REV. 905 (1996) (Traces U.S.
Supreme Court decisions over past twenty years that found
that "arbitration agreements covering claims arising under
congressional statutes are enforceable in accordance with the
terms of the FAA." Considers arbitrability of punitive damage claims, and preemption of FAA over state law in this
regard. Summarizes recent trends regarding arbitrability of
employment, consumer, family, tort, antitrust, bankruptcy,
and intellectual property law claims.).
Scott R. Swier, Note, The Tenuous Tale of the Terrible
Termites: The FederalArbitrationAct and the Court's Decision to Interpret Section Two in the Broadest Possible Manner: Allied-Bruce Terminix Cos., Inc. v. Dobson, 41 S.D. L.
REV. 131 (1995-1996) (Reviews the various tests used by
state and federal courts to determine whether certain activities involve interstate commerce to a degree sufficient to trigger the FAA. Criticizes Allied-Bruce for its unduly broad
construction of the interstate commerce requirement.).
Drafting Arbitration Agreements
Neal Blacker, Drafting the Arbitration/ADR Clause, 13 No. I
PRAC. LITIGATOR 51 (2002) (Examines legal issues related to
the incorporation of institutional arbitration rules into agreements. Outlines strategic, and practical, considerations in
framing the actual arbitration agreement. Provides extensive
checklist of items to be included in the arbitration agreement.).
Lucy E Reed, Drafting Arbitration Clauses, 670 P.L.I./LIT.
553 (Mar. 2002) (Outlines key issues to be addressed in nego130
FaIl 2002
tiating and drafting arbitration clauses in international contracts. Considers "scope and content of the clause, the seat of
arbitration, choosing the arbitrators and choosing the arbitration rules." Also provides model clauses.).
Erika Van Ausdall, Confirmation of Arbitral Awards:The
Confusion Surrounding Section 9 of the FederalArbitration
Act, 49 DRAKE L. REV. 41 (2000) (Discusses split among the
U.S. Courts of Appeals regarding the interpretation of section 9 of the FAA. In particular, considers the contractual
language required in order to authorize judicial enforcement
of an arbitration award. For example, while some courts hold
that "section 9 requires a clear statement by the parties in
their arbitration agreement that judgment be entered upon
issuance of the arbitration award," others hold that "while
some indicia of the parties' intent to be bound by arbitration
is necessary, explicit language providing for judicial confirmation is not mandated by the FAA. Concludes that "a court
should have the authority to confirm an arbitration award if
there is sufficient evidence that the parties intended the arbitration award to be final and binding.").
Jean R. Sternlight, Drafting a "Bulletproof" Consumer
ArbitrationAgreement: Is It Possible?, 1102 P.L.I./CoRP. 763
(Feb. 1999) (Considers whether it is possible to draft failsafe
arbitration agreement in consumer context. Categorizes types
of clauses and ranks clauses by likelihood of enforceability.
Concludes that the most enforceable clause is one that
secures benefits of speed, low cost, and expertise for both
sides, rather than to the drafter alone.).
Enforcement of Forum Selection
and Choice-of-Law Clauses
Note, An Unnecessary Choice of Law: Volt, Mastrobuono,
and FederalArbitration Act Preemption, 115 HARV. L. REV.
2250 (2002) (Addresses FAA preemption with respect to
generic choice-of-law clauses. Concludes that U.S. Supreme
Court has crafted line between protecting federal interest in
arbitration and preserving local autonomy in an area traditionally reserved to states. Discusses confusion of lower
courts in walking this line and offers suggestions with
respect to the proper resolution of this confusion.).
Nathan E. Ross, Note, Federalism versus the Greater
Good ...Should Powerful Franchisorsbe Allowed to Contract for the Home Court Advantage Through Forum Selection Clauses?, 2000 J. DIsP. RESOL. 199 (Discusses whether
FAA preempts state laws that otherwise invalidate forum
selection clauses contained in franchise agreements. In particular, considers the case of KKW Enters., Inc. v. Gloria
Jean's Gourmet Coffees FranchisingCorp., 184 F.3d 42 (1st
Cir. 1999), and concludes: "The FAA should preempt contrary state laws regarding the enforceability of forum selection clauses contained in arbitration provisions.").
Edward Wood Dunham, William A. Darrin, Jr., and Benjamin A. Levin, FranchisorAttempts to Control the Dispute
Resolution Forum: Why the FederalArbitration Act Trumps
the New Jersey Supreme Court's Decision in Kubis, 29 RUTGERS L.J. 237 (1998) (Reviews: (1) state and federal legal
standards applied to judicial forum selection clauses; (2) the
131
Fall 2002
133
FaIl 2002
(1988) (Contemplates circumstances, in the commercial arbitration context, in which collateral estoppel and res judicata
should bar litigation of previously decided issues or claims.
Concludes that "courts should be free to apply preclusion in
any case in which contractual intention supports it, regardless
of the traditional boundaries of res judicata and collateral
estoppel. The basis of arbitration is contract, and the preclusive effects of an arbitration award may legitimately extend
as far as the contractual agreement to arbitrate warrants.").
Privatization of Law Through Arbitration
Stephen J. Ware, Default Rules from Mandatory Rules: Privatizing Law Through Arbitration, 83 MINN. L. REV. 703
(1999) (Considers the extensive privatization of law through
the medium of arbitration. In particular, considers the impact
of current arbitration law on the privatization of other areas
of law. Suggests that what conventional wisdom may deem
to be mandatory laws, or laws providing for rights or duties
that cannot be avoided by contract, may in fact be alterable
by contract-by means of an arbitration agreement.).
Waiver of Contractual Arbitration Rights
Matthew Forsythe, The Treatment of Arbitration Waivers
Under Federal Law, DISp. RESOL. J., May 2000, at 8 (Analyzes recent federal cases addressing waiver of contractual
arbitration rights. Identifies key factual considerations and
standards applied by U.S. Courts of Appeals in arbitration
waiver cases. Concludes that although federal cases may
seem unrelated, each case generally "involves a review of the
amount of delay involved, some speculation concerning the
parties' intent to arbitrate, and, to varying degrees, whether
the party opposing arbitration has suffered prejudice." Further
finds that "[federal courts remain reluctant to allow litigants
to invoke arbitration at a late date, after they have deliberately
elected to participate in expensive and protracted litigation.").
Ethics and Arbitration
Stephen K. Huber, The Role of Arbitrator: Conflicts of Interest, 28 FORDHAM URB. L.J. 915 (2001) (Considers unique
role of arbitrators, who may have greater power than civil
judges due to standards of review under the FAA and UAA.
Discusses factors influencing the neutrality of arbitrators.
Argues that arbitration raises important ethical issues that
should receive greater emphasis in legal education.).
Matthew J. Clark, The Legal and Ethical Implications of
Pre-Dispute Agreements Between Attorneys and Clients to
Arbitrate Fee Disputes, 84 IOWA L. REV. 827 (1999) (Considers legal and ethical consequences of predispute agreements
between clients and attorneys to resolve fee disputes by arbitration. Discusses the treatment of such agreements by bar
associations, state courts, and commentators. Concludes that
predispute fee arbitration agreements are most appropriate if
executed postdispute, in that these agreements "limit the voluntary nature of a client's decision to arbitrate and inhibit the
client from being able to consider fully the facts and circumstances surrounding a dispute before deciding on the appropriate forum for its resolution.").
Fall 2002
135