Roselle L. Wissler is Research Director of the LodestarDispute Resolution Program, and Bob Dauber is ClinicalProfessor of Law, at the Sandra Day O’Connor College ofLaw at Arizona State University.

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In 2004, the Supreme Court of Arizona commissioned astudy of court-connected arbitration in Superior Court to examine its effi-ciency and effectiveness, as well as user satisfaction with the process.1 Latein 2005, after the study’s completion, the Supreme Court appointed theCommittee on Compulsory Arbitration in the Superior Court (“the com-mittee”) to review the study’s findings and other relevant material and“make recommendations on ways in which the compulsory arbitrationsystem in Arizona could be made more effective and efficient in the han-dling of claims.”2

The 14-member committee—composed of judges, court administra-tors and other court personnel, as well as plaintiff and defense lawyers—discussed a number of issues and developed a set of proposed changes toboth the Arbitration Rules and the authorizing statute. During the sum-mer and fall of 2006, the committee’s initial recommendations were pre-sented for comment to the bar during a session at the State BarConvention, to the Committee on Superior Court, to the Superior CourtClerks Association, and to the Superior Court Administrators. These

BY ROSELLE L. WISSLERAND BOB DAUBER

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groups suggested a few changes, most ofwhich the committee incorporated into itsfinal recommendations, which the ArizonaJudicial Council subsequently approved.

The committee’s recommendations cul-minated in a Rule Change Petition filed withthe Arizona Supreme Court in October2006.3

This article summarizes the committee’sdiscussions and the recommendations thatform the basis of the Rule Change Petition.4

Considerations and RecommendationsStatus of ArbitrationThe committee’s first recommendation wasthat compulsory arbitration be continued inArizona’s Superior Courts. The consensuswas that the elimination of arbitration wouldlikely increase the courts’ workload, litigants’costs, and delays, and that these would havea negative impact on litigants’ access to thecourts. The committee declined to considerwhether the courts should provide othermandatory ADR processes, in addition toarbitration, from which the parties couldchoose, viewing that issue as outside itscharge.

Dollar Limits and AppealsThe committee recommended increasingthe maximum jurisdictional limit for arbitra-tion cases from $50,000 to $75,000 toadjust for inflation. Although the committeewas aware that lawyers representing busi-nesses are interested in more cases being eli-gible for arbitration, the committee did notincrease the jurisdictional limit to its fullinflation-adjusted value of $91,000. It wasconcerned that the appeals might be morelikely in higher-value cases and that the timeand cost involved in litigating those casesmight be at odds with arbitration’s goals ofresolving cases faster and less expensively.

The committee considered changes invarious components of the disincentive forrequesting a trial de novo, wanting to keepthe rate of appeal in check without impedinglitigants’ right to trial. The committee alsodiscussed whether the standard of reviewshould be changed to address the problemof lawyers subverting the disincentive bypresenting more complete evidence at thetrial de novo than at the hearing. Ultimately,the committee recommended keeping boththe current appeal disincentive and standardof review.

Mandatory or Voluntary ServiceThe committee addressed the central issueof whether arbitrator service should bemandatory or voluntary and ultimately rec-ommended that arbitrator service bemandatory across the state. The committeerecognized that the prevailing view amonglawyers is that arbitrator service should bevoluntary. Committee members also notedthat voluntary service could potentiallyimprove the quality of arbitration by havingonly arbitrators who wanted to serve and bypermitting requirements, such as arbitrationtraining, as a condition of service. Themajor consideration in opposition to volun-tary service was that it would reduce thepool of arbitrators, which could result in aheavier caseload for arbitrators, increasedhearing delays for litigants, and more con-flicts arising from arbitrators repeatedlyhearing cases involving the same lawyers.

CompensationThe committee agreed that the current rateof arbitrator compensation is inadequate andrecommended increasing it to $150 perhearing day to adjust for inflation. The com-mittee also supported awarding CLE creditas an alternative form of compensation, leav-ing the number of credit hours to be deter-mined by the Supreme Court, with inputfrom the State Bar Board of Governors.Because changing the rate of arbitrator com-pensation is dictated by statute and, thus,would require legislative action, the com-mittee offered two recommendations, in thealternative: That arbitrators receive bothmonetary compensation and CLE credit ifthe legislature does not change the rate ofcompensation, but that arbitrators wouldhave to choose either monetary compensa-tion or CLE credit if the legislature increas-es the fee.5

Arbitrator Qualifications & AssignmentThe committee considered possible changesin the eligibility requirements for arbitratorservice, including raising the number ofyears of State Bar membership and requiringcivil litigation experience, but ultimately rec-ommended retaining the current require-ments. The consensus was that althoughthese changes would increase arbitrators’level of experience, they also would reducethe arbitrator pool in some counties andincrease the number of arbitrators who

would have conflicts or be stricken by theparties due to perceived bias. Althoughmembers did not see civil litigation experi-ence as necessary for deciding cases, theyacknowledged that non-civil litigators mighthave difficulty deciding discovery or dispos-itive motions and ruling on procedural orevidentiary issues.

The committee noted that arbitrationtraining is important and could be particu-larly helpful for lawyers who did not havecivil litigation experience, but felt that train-ing could not be made mandatory given thatarbitrator service is compulsory. The com-mittee strongly recommended providingmore training and support resources forarbitrators and proposed the creation of anarbitration training curriculum and writtenreference materials that could be accessedonline as well as in a more traditional CLEcontext.

The committee considered, but ultimate-ly recommended against, arbitrators beingassigned to cases on the basis of subject mat-ter. The committee raised concerns that thiswould reduce the pool of available arbitra-tors and increase the number of arbitratorswho would have conflicts or be stricken bythe parties due to perceived bias. In addi-tion, some members felt that substantiveexpertise was not needed because lawyers forthe parties should provide the necessary law;others felt that expertise could even be a dis-advantage by making arbitrators less open tocertain arguments and evidence.

MotionsThe committee noted that having arbitratorsdecide dispositive motions in cases not intheir area of expertise might be counterpro-ductive and inefficient if it resulted in incon-sistent rulings between arbitrators andjudges, leading parties to appeal and file thesame motion for summary judgment with ajudge. Some members, however, were con-cerned that referring motions to the judgewould increase delay. The committee ulti-mately recommended that wholly dispositivemotions be decided by the trial judge insteadof the arbitrator. In addition, the committeerecommended that motions for summaryjudgment be filed with the trial judge at least20 days before the scheduled arbitrationhearing and that the filing of the motion tollthe time for conducting an arbitration hear-ing, but that the court shall impose sanctions

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if it finds the motion was filed for the pur-pose of delay or harassment.

With regard to discovery motions, thecommittee adopted verbatim a rule changeproposed by the Arizona State Bar CivilPractice & Procedure Committee thatallows a party to appeal an arbitrator’s rulingrequiring the disclosure of information theparty claims is privileged, confidential orotherwise protected from discovery. Andwith regard to other motions, the commit-tee recommended that arbitrators no longerhear motions to withdraw as counsel.

Evidence RulesThe committee discussed whether the cur-rent requirement that the Arizona Rules ofEvidence apply in arbitration hearingsshould be kept or whether admissible evi-dence should be expanded. Some membersfelt the Rules of Evidence were needed sothat counsel would have grounds for object-ing to evidence presented. Others felt thatadmitting all previously disclosed evidenceand letting the arbitrator decide what weightto give it would benefit arbitrators, especial-ly those whose practice does not involve civillitigation or those hearing cases involvingpro per litigants, by reducing the need to ruleon technical objections. The committee rec-ommended that the Rules of Evidence serveonly as a guide and that the arbitrator havediscretion to admit other relevant and previ-ously disclosed evidence.

Proposals Regarding Efficiency IssuesThe committee considered a number of pos-sible changes to enhance arbitration’s effi-ciency, starting with the timing of assign-ment of cases to arbitration. The committeerecognized that, in counties that presentlydo not appoint arbitrators until after themotion to set is filed, the early assignment ofcases to arbitration would increase the num-ber of cases assigned to arbitrators. Therewas general agreement that cases should beassigned to arbitration shortly after thepleadings in order to reduce the time to dis-position, but members were reluctant toimpose specific deadlines that might adverse-ly affect courts that use early case-manage-ment procedures to address arbitrability.Accordingly, the committee recommendedthat counties assign cases to arbitration assoon after the answer as is feasible, but in noevent later than 120 days after the answer.

The committee also discussed changingvarious deadlines, limiting discovery andcontinuances, and increasing court involve-ment in scheduling and enforcement ofdeadlines. Committee members with experi-ence in personal injury litigation pointed outthat the arbitration deadlines could not beshortened effectively unless the exchange ofbasic case information and the provision ofmedical releases for obtaining documentsfrom third parties were accelerated.Members felt that plaintiffs typically wouldhave much of the information needed toprosecute the case at the time of filing and,thus, could provide disclosure materials ear-lier than presently required. This, in turn,would enable the defense to evaluate theplaintiff’s claims and to disclose informationearlier, which ultimately would expedite thefinal resolution of the case.

Accordingly, the committee recommend-ed the creation of new disclosure require-ments and deadlines. Within 10 days of serv-ice of an answer, the plaintiff would have toprovide a disclosure statement and answersto applicable uniform interrogatories and, inpersonal injury cases, additional medicalrecords, names of health care providers andexecuted HIPAA-compliant medical releas-es. Within 30 days of filing an answer, thedefendant would have to provide a disclo-sure statement, answers to applicable uni-form interrogatories and a non-party at faultstatement.

In an effort to streamline the post-hearingprocess, as well as to address an apparentproblem of cases lingering on court docketslong after they have concluded, the commit-tee recommended a new process involvingthe notice of decision, award, entry of judg-ment, and court dismissal of the case. Thearbitrator would have to file the notice ofdecision with the court within 10 days afterthe hearing. If no further action were taken(e.g., no request for an award of fees), thenotice of decision would automaticallybecome the award. However, the awardwould not be converted into a judgmentunless a party applied to have judgmententered on the award. If no application forjudgment were filed and no appeal werepending, the court would dismiss the case120 days after the notice of decision. In addi-tion, the committee recommended that par-ties in cases that settle file an appropriate stip-ulation and order with the trial judge.

Committee members felt this process, inmost cases, would involve less paperwork onthe part of both arbitrators and parties, avoidhaving judgments unnecessarily entered ondefendants’ records, and provide a mecha-nism for the dismissal of cases that were infor-mally resolved after the arbitration hearing.

MonitoringIn light of the recommended changes to thearbitration system, the committee also sug-gested that the Administrative Office of theCourts determine whether and how it wouldbe feasible to monitor the efficacy of thechanges.

Opportunity To CommentThe comment period for the Rule ChangePetition runs through May 21, 2007. Thepetition is available on the Supreme Court’sWeb site, and comments may be postedthere as well.6 In September 2007, theArizona Supreme Court will decide whetherto adopt the proposed changes, whichwould become effective in January 2008.

1. The findings of the study were summarizedin Lawyer Views on Mandatory Arbitration,ARIZ. ATT’Y, July/August 2005, at 32, andMandatory Arbitration in Arizona:Structure and Performance, ARIZ. ATT’Y,Oct. 2005, at 15. The full report is avail-able at www.law.asu.edu/LodestarDisputeResolution/ArbitrationStudy2005

2. Supreme Court of Arizona, AdministrativeOrder No. 2005-79, Establishment of theCommittee on Compulsory Arbitration inthe Superior Court of Arizona (Nov. 2,2005).

3. R-06-0021, Petition to Amend the Rulesof Civil Procedure, Section IX.Compulsory Arbitration Rules 72-76,available at www.supreme.state.az.us/rules.

4. This information is based on the authors’observations of the discussions, motionsand votes that took place during the com-mittee’s meetings. See also Final Report ofthe Committee on Compulsory Arbitrationin the Superior Court in Arizona, June2006, available atwww.supreme.state.az.us/courtserv/Arbitration/Committee_on_Compulsory_Arbitration_Final_Report.pdf

5. The proposed statutory changes to increasearbitrator compensation as well as the juris-dictional limit have been included in theArizona Judicial Council’s 2007 LegislativeProposals. See www.supreme.state.az.us/ajc/updatedappprop.pdf

6. www.supreme.state.az.us/rules.

endnotes

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