When entering into contractual agreements it is wise to specify an alternative dispute resolution process. The court systems of the state and federal systems are too inefficient and expensive to provide effective resolution of business disputes. Commercial arbitration has become as burdensome and expensive as the state and federal courts. Rarely is mediation an effective way to resolve business disputes. Here are the terms for a private arbitration dispute resolution process:
1. Any controversy or claim arising out of or relating to this agreement or the breach of this agreement not otherwise resolved shall be settled by private arbitration, pursuant to the following:
a. Should the parties be unable to agree upon an arbitrator and a procedure for accomplishing the arbitration, by written notice, one party may designate a qualified arbitrator and demand upon the other parties to the controversy to furnish the names of qualified arbitrators within ten days from the giving of such notice. A qualified arbitrator shall be a licensed professional with expertise in the area related to the disagreement of the parties and has agreed to act as arbitrator. In the event the other parties submit no name of a qualified arbitrator, then the qualified arbitrator designated by the demanding party shall be the arbitrator. In the event the other parties provide names of qualified arbitrators, the demanding party may name one of those persons arbitrator, or may name one of those persons as arbitrator to act with the arbitrator designated by the demanding arbitrator; in such a case either party may elect to have the named arbitrators designate a third qualified arbitrator. If there is more than one arbitrator appointed action taken by the arbitrators shall be by majority vote and any reference to arbitrator shall refer to the arbitrators acting together. If for any reason this process does not cause an arbitrator to be named within thirty days of the giving of the initial notice by the demanding party, then the demanding party, or any other party, by written notice may again designate a qualified arbitrator and demand upon the other parties to each provide the name of a qualified arbitrator. If this second process is not successful or an arbitrator is not named within sixty days of the giving of the initial notice by the demanding party, either party may petition a convenient court of local jurisdiction to appoint a qualified arbitrator.Immediately after a qualified arbitrator has been appointed pursuant to the above-described procedure, the arbitrator shall affix a date for the arbitration hearing, which date shall not be sooner than thirty nor later than ninety days from the date the arbitrator is appointed.
b. The rules for the procedure and conduct of the arbitration shall be those agreed upon by the parties, but in the event the parties cannot agree within ten days after the date the arbitrator is appointed, then the rules for the procedure and conduct for the arbitration shall be as determined by the arbitrator.
c. The fees and expenses of the arbitrator and the arbitration process shall be shared equally by the parties to the arbitration.
d. Not less than ten days prior to the arbitration hearing, each party shall submit to the arbitrator and exchange with each other their last best offers of settlement of the controversy. The arbitrator shall be limited to awarding one of the offers of settlement of the controversy.
e. The arbitrator's award shall be final and binding upon the parties to the arbitration.
