Arbitration is often promoted as faster, cheaper, more predictable, and more controllable than litigation. But to many, arbitration’s promise comes up short on delivery. Why? A prime reason is that many parties do not make use of their ability to shape a proceeding that fulfills those promises, and end up with an arbitration that is more time consuming, more expensive, and less predictable than it could have been.

Arbitration is actually the ultimate Choose Your Own Adventure story. Each arbitral proceeding is potentially unique because the parties get to prescribe their procedures in their arbitration agreement. A well-designed arbitration clause can give the parties substantial control over procedures and costs, as well as over who decides which issues and when. All too often, however, parties make agreements that leave the decisions on most of their options to others or to chance.

Indeed, many arbitration administrative bodies — e.g., AAA, ICC, and LCIA — actively promote the use of generic arbitration clauses, which suffice to compel arbitration but rarely compel the arbitration you want. A five minute online search for “sample arbitration clauses” verifies the point, revealing clauses like the following:

“All disputes arising out of or in connection with the present contract shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce by one or more arbitrators appointed in accordance with the said Rules.” (iccwbo.org/dispute-resolution-services/arbitration/arbitration-clause/)

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