Conflict Resolution

AAA Offers Online Clause-Drafting Tool

It has long been broadly agreed that the most effective target for education and training in ADR is the lawyers who draft the deals.  Drafting a dispute resolution clause as an elegant risk allocation is surely the Holy Grail of commercial deals.  Model clauses are promulgated by many ADR organizations, but inept and hoary arbitration and forum selection provisions continue to be cut-and-pasted, to the dismay of litigators and the chagrin of their clients, who realize too late, once the train has hit them, what a mess their inattention caused.

The American Arbitration Association has done us all a great service in launching  This tool presents the contract drafter with the same considerations that ADR professionals have urged for years, but in an electronic environment that results in an easy-to-use, easy-to-draft dispute resolution provisions.

After presenting the standard AAA arbitration clause, the web site takes the user through all the essential choices, soliciting responses that fit the particular deal being papered and modifying the clause as we go.  These questions include:  Mediation before arbitration?  Confidentiality?  Number of arbitrators?  Qualifications for neutrals?  Governing law?  Limits on discovery?  Hearings or documents-only? Place of hearing?  Assessment of fees?  Appeal?  Consequences of failure to make payments when due?

And at the end we have a neat and tidy stepped dispute management clause that the parties have agreed addresses the deal at issue in a manner that allocates the risks of the consequences of breach.

When I joined CPR in 1998 the cool thing was to send out to our members floppy disks (remember them?) containing model clauses that could be imported into documents.  The AAA is to be congratulated for this elegant product, brilliantly set forth, quite simple, and urgently needed.  Bring this to the attention of your transactional brethren and you will be adding value to all concerned.

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