NCJ Number
96695
Journal
National Resource Lawyer Volume: 15 Issue: 2 Dated: (Spring 1982) Pages: 449-456
Date Published
1982
Length
8 pages
Annotation
When considered from the standpoints of time, cost, and results, arbitration is an appropriate mechanism for resolving many disputes in natural resources industries.
Abstract
In 1981, arbitration was used to resolve a dispute between timber owners. The seller agreed to refund the buyer for any shortfall in the warranted amount of merchantable timber involved in the land sale which generated the dispute. The agreement also contained provisions for the method of determining the volume of merchantable timber on the property. The buyer and seller disagreed on the volume and invoked the arbitration provisions of the sales agreement. The hearing continued over 2 months, with 29 days in actual hearings. A month later the arbitrators rendered their decision regarding the volume of timber, resulting in a refund from the seller to the buyer and an end to the dispute. Even though the parties incurred substantial expenses, the cost of arbitration was less than would have been the case under litigation. The time factor greatly favored arbitration, as the major dispute was resolved in about 6 months. The result was desirable, because the case was settled by people who were experts in their field. Although drawing general conclusions from a single case is difficult, this case shows that businesses which have a legitimate factual dispute should use arbitration rather than litigation. The arbitration panel should have expertise in the area under dispute. Lawyers should provide for arbitration in the contracts they draft for their business clients and should consider arbitration rather than court proceedings. Lawyers should also not fear mandatory arbitration. Footnotes are included.