Hiro Aragaki, ‘Arbitration: Creature of Contract, Pillar of Procedure’

It is difficult to quarrel with the refrain that ‘Arbitration is a creature of contract’. Unlike the default of public litigation, arbitration is a private process that requires voluntary choice to get off the ground. But while arbitration may originate in a contract, it lives out its life as a procedure. All the arbitration agreements in the world would not give us a living, breathing institution of arbitration if none of them resulted in an actual proceeding.

In this paper, I call for re-framing the way we think about US arbitration – from a ‘creature of contract’ to something that is also a ‘pillar of procedure’. Just a simple change in the stock phrase we use to speak about arbitration, I argue, will help us refocus our attention on an important raison d’être of arbitration. In the domestic sphere, that raison d’être has long been to serve as something of a model or ‘pillar’ of good procedure – that is, to provide a process that at least equals or rivals what public courts can offer, not just in the sense of being faster and cheaper but also in the sense of delivering a superior adjudicative process. In part due to the centrality of freedom of contract in the US Supreme Court’s arbitration jurisprudence, we have lost a good deal of this focus. Rather than procedural integrity or excellence, arbitration has come to stand for the untrammeled pursuit of private ordering, often to the detriment of weaker parties for whom fair, accessible procedure is vital. My point is not that we must choose between contract and procedure; instead, it is that we risk overlooking at least half of the equation when we persist in referring to arbitration as a ‘creature of contract’.

Aragaki, Hiro N, Arbitration: Creature of Contract, Pillar of Procedure (May 3, 2018). 8 Year Book of Arbitration and Mediation 2 (2016); Loyola Law School, Los Angeles Legal Studies Research Paper No 2018-14.

First posted 2018-05-30 15:51:32

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