Survey shows most favor arbitration over litigation

Chris Rizo Apr. 3, 2008, 8:00pm

WASHINGTON - An overwhelming majority of voters say they prefer to resolve legal disputes through arbitration rather than seeking redress in the courts, a newly released poll indicates.

The survey by the U.S. Chamber of Commerce's Institute for Legal Reform (ILR) found that most likely voters say they favor arbitration as a method for resolving both consumer and employee disputes, with 82 percent of voters preferring arbitration over litigation as a means to settle a serious dispute with a company. The U.S. Chamber of Commerce owns LegalNewsLine.

The poll of 800 likely voters also found that 71 percent of respondents say they oppose efforts in Congress to remove binding arbitration agreements from consumer contracts.

The clauses are common in consumer contracts, such as for credit card companies, cellular phone service providers, and are in some employer contracts and in papers for home and car purchases, experts said.

Larry Akey, spokesman for the ILR, said Thursday that arbitration has proven to be a fair venue for consumers and businesses to resolve disputes.

The poll, conducted in December 2007, should "caution" federal lawmakers, who are considering legislation that would declare voluntary agreements to resolve differences through binding arbitration unenforceable, he told LNL.

"The downside obviously to eliminating arbitration is that because so many of these claims are small-dollar claims, claimants would find themselves in a situation where they would be hard pressed to find an attorney to take their case," Akey said.

The Arbitration Fairness Act, carried in proposals by Sen. Russ Feingold, D-Wis., and Rep. Hank Johnson, D-Ga., would nullify arbitration provisions in hundreds of millions of existing contracts, observers on both sides of the issue told LNL.

Akey said eliminating arbitration clauses would funnel hundreds of thousands of consumer and employment cases into already beleaguered state and federal court systems.

However, Taylor Lincoln, research director of Public Citizen's Congress Watch, said if enacted the legislation would give consumers back some of their legal rights.

Entering into arbitration, he said, is not the same as a consumer and a business going to a mediator to hammer out their differences.

"It's not like you're just going to a mediation to work things out before you go to court," Lincoln told LNL.

"If you sign for mandatory binding arbitration, that's it; it's the end of the road" in terms of a consumer's legal options.

He said the companies get to choose the arbitrator and they pay the arbitration company for their services.

"It would be like getting to pick the referee," he said.

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