THE COURT-ANNEXED ARBITRATION ACT OF 1978

FRIDAY, APRIL 14, 1978

U.S. SENATE,

SUBCOMMITTEE ON IMPROVEMENTS IN

JUDICIAL MACHINERY OF THE
COMMITTEE ON THE JUDICIARY,

Washington, D.C.

The subcommittee met, pursuant to notice, at 9:10 a.m., in room 2228, Dirksen Senate Office Building, Senator Dennis DeConcini (chairman of the subcommittee) presiding.

Staff present: Robert E. Feidler, counsel; Michael J. Altier, deputy counsel; Kathryn M. Coulter, chief clerk; Pamela Phillips, assistant chief clerk; Rosalie Cameron, professional staff member; and Karen Kennedy, professional staff member.

Senator DECONCINI. Good morning. The Subcommittee on Improvements in Judicial Machinery will come to order.

Today we will hold the first of three hearings on S. 2253, a legislative proposal which would establish a compulsory, nonbinding arbitration program for the district courts. Under the proposal, specified categories of civil actions would be referred to arbitration with the right to a full district court trial de novo preserved.

Compulsory, nonbinding arbitration, similar to that proposed under the bill, has been in use in several States. Ohio, Pennsylvania, New York, and California, are examples which have had positive results with compulsory nonbinding arbitration for relatively small claims. However, it is recognized that in adopting a Federal arbitration plan, Congress must proceed cautiously and address itself to the unique concerns of the Federal courts.

The bill sets forth procedures for compulsory, nonbinding arbitration. Under the proposal, five to eight districts shall be chosen by the Chief Justice to try compulsory, nonbinding arbitration on an experimental basis. Any district may also adopt this arbitration procedures on its own. This combination of voluntary use and the control group of five to eight districts is warranted in order to evaluate the advantages and disadvantages of its use in the Federal court system.

Under the bill, all cases of specified types filed with each district court adopting the scheme would be referred to arbitration soon after the pleadings are closed. In addition, any matter to which the parties consent to arbitrate would also be referred to arbitration. Cases will be referred to arbitration as soon as possible after the

44.589/2: C83/12

THE COURT-ANNEXED ARBITRATION ACT OF 1978

COMMITTEE ON THE JUDICIARY
UNITED STATES SENATE

NINETY-FIFTH CONGRESS

SECOND SESSION

ON

S. 2253

TO AMEND TITLE 28 OF THE UNITED STATES CODE TO
ENCOURAGE PROMPT, INFORMAL, AND INEXPENSIVE RESO-
LUTION OF CIVIL CASES BY USE OF ARBITRATION IN THE
UNITED STATES DISTRICT COURTS

COMMITTEE ON THE JUDICIARY

JAMES O. EASTLAND, Mississippi, Chairman

FRANCIS C. ROSENBERGER, Chief Counsel and Staff Director

SUBCOMMITTEE ON IMPROVEMENTS IN JUDICIAL MACHINERY DENNIS DECONCINI, Arizona, Chairman

ROMANO ROMANI, Staff Director
ROBERT E. FEIDLER, Counsel
MICHAEL J. ALTIER, Deputy Counsel

Opening statement: Hon. Dennis DeConcini, U.S. Senator from Arizona, chairman, Subcommittee on Improvements in Judicial Machinery. Witnesses:

Hon. Griffin B. Bell, Attorney General of the United States, accom-
panied by: Daniel J. Meador, Assistant Attorney General, Office
for Improvements in the Administration of Justice, and John M.
Beal, Attorney, Office for Improvements in the Administration of
Justice_

Robert Coulson, president, American Arbitration Association, New
York, N.Y.

Page

3

1

16

34

Hon. James R. Cavanaugh, judge, Court of Common Pleas, Philadelphia, Pa..-.

58

Lewis Jay Gordon, chairman, Compulsory Arbitration Committee,
Philadelphia Bar Association.......

85

Craig Spangenberg, chairman, congressional liaison, Association of
Trial Lawyers of America..

108

Charles M. Tatelbaum, chairman, Eastern District Commercial
Law League of America..

115

Alphabetical Listing of Witnesses:

Bell, Hon. Griffin B., Attorney General of the United States, accompanied by: Beal, John M., attorney, Office for Improvements in the Administration, of Justice, and Meador, Daniel J., Assistant Attorney General, Office for Improvements in the Administration of Justice.._.

Cavanaugh, Hon. James R., judge, Court of Common Pleas, Phila-
delphia, Pa..

Coulson, Robert, president, American Arbitration Association, New
York, N. Y...

Gordon, Lewis Jay, chairman, Compulsory Arbitration Committee,
Philadelphia Bar Association....

Spangenberg, Craig, chairman, congressional liaison, Association of
Trial Lawyers of America_-_-_-

Tatelbaum, Charles M., chairman, Eastern District Commercial
Law League of America..

APPENDIX

District court rules for pilot projects: District of Connecticut, Eastern
District of Pennsylvania, Northern District of California and Southern
District of New York..

Letter of March 3, 1978 from Richard A. Givens, chairman, Committee
on Federal Legislation, New York County Lawyers' Association,
accompanied by report submitted by the New York County Lawyers'
Association: "Disapproval of proposed legislation to Encourage Arbi-
tration of Civil Cases in the U.S. District Courts," February, 1978----
Letter from the Public Citizen Litigation Group, April 12, 1978.
Letter from Baltasar Corrada, Resident Commissioner, Puerto Rico,
April 24, 1978..........

16

58

34

85

108

115

121

131

133

134