Alternative Dispute Resolution s2

ALTERNATIVE DISPUTE RESOLUTION

FINAL EXAMINATION

Fall 2000

(2 Hours)

1. (15 Points) Bob Bush instituted an arbitration proceeding with respect to a contract with Gary Gore. Assume the Federal Arbitration Act (FAA) applies. After a regularly-conducted arbitration proceeding, resulting in no award for Bush, Bush is unhappy with the result and retains you to advise him of the types of grounds upon which he might challenge the award. He asks you to describe those grounds, in general, and how you might go about such a challenge.

2. (20 Points) Your client, Bare Bryant, Jr., owns a termite service in the State of Alabama. He uses only Alabama-produced materials, conducts his business in such a way as to exempt it from any federal regulation, does business only with Alabama homeowners, and in fact will not allow his employees to read any trade literature unless it originates in Alabama. His sales contract includes an arbitration clause, but such clauses are not enforceable under Alabama law. Bare treats a house for Mr. and Mrs. Auburn who, six months later, sell the house to Peter Plaintiff and move to Montana. A few weeks after the sale, Peter's house is entirely consumed by termites, and Peter sues the Auburns in federal court in Montana. The Auburns file a third-party claim against Bare Bryant. Assume that the Montana court has jurisdiction and can get service on all necessary parties.

Bare asks you to get him out of this litigation, so you file a motion to stay the court proceeding against Bare and compel arbitration. How should the court rule?

3. (15 Points) Please recommend (and briefly explain) whether you believe an ADR procedure would be appropriate for the following cases, and if so what kind:

(a) A personal injury claim in which the parties have directly conflicting testimony concerning whether the traffic light was red or green.

(b) The wrongful death claim of the family of a murdered wife against the husband, who has been acquitted of the murder charge but is probably guilty.

4. (5 Points) The answer is that the most useful technique would be minitrial. What is the question?

5. (5 Points) In an AAA arbitration, the respondent is notified of the hearing date but delivers a letter to the arbitration panel indicating that he objects to the hearing and will not appear. He does not ask for a continuance. The claimant, anticipating that the respondent will not appear, comes to the hearing and asks immediately that an award be given based upon his complaint. How should the arbitrators rule?

6. (5 Points) In the course of an AAA arbitration, the respondent broker offers an affidavit from another brokerage house indicating that the claimant is not an inexperienced novice, but is rather a savvy and aggressive trader. This issue is crucial to the resolution of the claim.

· Should the affidavit be received into evidence?

· What weight should it be given?

· Are there additional facts which you, as chair of the panel, would wish to know regarding the affidavit?

7. (10 Points) Leonard Lieberman enters into an agreement with Clifford Cheney to sell Lieberman's worthless stock in Lieberman Enterprises, Inc. to Cheney for a very high price. Lieberman presents false financial statements and a fraudulent description of the business in the sales contract, which contract includes a broad arbitration clause.

· Should the enforceability of the arbitration clause be a question for the court or the arbitrator?

· Why?

· Does your answer differ depending upon whether interstate commerce is involved?

8. (15 Points) Your client, US Shipbuilding Corp., has a collective bargaining agreement (CBA) with the Shipworkers Union. The only relevant provision of the CBA regarding arbitration is one which simply states that "all matters arising under this contract" be submitted to binding arbitration. Alan Ahab, a Union member who works at the shipyard, believes he has been discriminated against based on his race and has brought a Title VII suit against US Shipbuilding in federal district court. He says the Union is also prepared to back him with a strike if US Shipbuilding doesn't settle with him. Your client has asked you if the arbitration clause means that this suit can be stayed pending arbitration. What advice do you give?

9. (10 Points) You are a writer who owns and works at a beautiful house in a part of town that is not yet extensively developed. Recently, you learned that the property next to yours has been purchased by a paramilitary group, the Montana Militia. Though they have not yet taken possession, your inquiries have turned up, among other things, the fact that their regular routine includes amplified bugle calls every 30 minutes. Since this will obviously interfere with your work, you list your house with a realtor. You are soon contacted by a couple, who tell you that they are interested in the house.

(a) Should you tell them about the Montana Militia?

(b) Suppose they say they both work nights and are interested primarily because of the quiet neighborhood. Does that change your answer?