Contracts and Arbitration

I began as a law teacher working in the field of commercial law.  I was instrumental in securing adoption of the Uniform Commercial Code by Wyoming, which was first western state to take that step.  In 1985, I was a founder of the Private Adjudication Center, an institution operated by Duke University and designed to provide dispute resolution services and conduct research and teaching in the field of ADR.  The Center provided services in resolving over 7,000 disputes, but it was closed in 2004. 

The Uniform Commercial Code (Wyoming Legal Research Bureau, 1960) also published in Vols 14 and 15 of the Wyoming Law Journal

Book Review, Honnold & Farnsworth: Cases and Materials on Commercial Law, 50 Minn. L. Rev. 601 (1966)

Civil Procedure and Alternative Dispute Resolution, 34 J. Leg. Ed. 298 (1984)

       republished in Civil Procedure Anthology (Levine, Doernberg & Nelken eds, 1998)

ADR and Future Adjudication: A Primer on Dispute Resolution, 15 Rev. of Litigation 1 (1996)

       republished  in 31 International Society of Barristers Quarterly 362 (1996)

Meanwhile, I had acquired a measure of skepticism about the uses to which ADR was being put.  Since 1996, I have published numerous articles in professional journals condemning judicial decisions that have permitted business to use arbitration clauses in printed standard form contracts to strip consumers, investors, patients and others of procedural rights needed to enforce their rights under state and federal laws. Self-Deregulation.  In further protest against the use of standard form contracts, I have written my own form that might be described as an anti-contract.  It is designed to be published on a website such as this.  Warranties in Contracts Made by PDC.  No claim of copyright is made, so viewers should feel free to post the instrument on their own website, substituting their names for mine.  If anyone reckons themselves indebted for this contribution to the public domain, they may make a contribution to the North Carolina Fair Bargain Committee.

I also wrote a law.  This legislation was drafted by me and Donald Clifford in 2000 to correct the problem of unconscionable arbitration clauses.  Our draft was soon enacted in New Mexico.  It has since been introduced in other states.  Its purpose is to correct the misuse of dispute resolution clauses. Our Model Fair Bargain Act was introduced in North Carolina in 2003, and may be ripe for consideration in 2008 here or elsewhere.  I have also suggested to the Business Law Section of the ABA that lawyers who propose and draft oppressive form contracts stripping consumers of their rights may be exposing themselves to personal tort liability, perhaps including punitive damages sufficient to deter such conduct.

Beginning in the 1980s, the Supreme Court by extravagant decisions, some of them overruling its own prior decisions, has re-written the 1925 Federal Arbitration Act so that it is an effective device for reducing the enforceability of federal and state law made to protect workers, investors, patients, consumers, and franchisees.  In 2002, I was paid by the National Automobile Dealers Association to make an argument for enactment of a federal law exempting automobile dealers from the Federal Arbitration Act.  Senator Hatch sponsored the bill ad it was enacted.  The Rural America Foundation sought similar legislation to protect poultry growers and other contract farmers from the oppressive practices of food processors who buy their produce.  Senator Grassley led the effort and I supplied him with a memorandum of support identical to that supplied to the automobile dealers. His proposal was enacted in 2008..

And I have provided support for lawyers representing clients beleaguered by overbearing business.  I even filed a grievance against a lawyer who tried to enforce an alleged contract by threatening to turn an impoverished defendant over to the federal Internal Revenue Service for failing to report income that she had not in fact received.  I wrote an amicus brief filed in the Supreme Court of Mississippi for RAFI in a case involving contracts between hog growers and a processor.  We lost.  I tried also to help lawyers arguing in the Supreme Court for the Florida courts' holding that contracts void because they are usurious are not enforceable in arbitration, but they lost, too.

In 2007, I published an op-ed piece in the National Law Journal commenting on the fact that automobile dealers are not bound by arbitration clauses in  the contracts they sign, but the buyers to whom they sell cars are bound.  And I continue to urge NC-AARP and NCATL to address the issue.  I am heartened that Senator Feingold and others have taken an interest in the problem.  Congress badly needs to overrule much of what the Court has done to the national law.

My other publications on this subject are: 

Contract and Jurisdiction, 1996 Supreme Court Review 331 (1997) (with Paul Haagen)

Regulating Dispute Resolution Provisions in Adhesion Contracts, 35 Harv. J. Legis. 227 (1998)

Virtual Arbitration, 15 Ohio State J. Disp. Res. 669 (2000)

The Dark Side of Contract Law, Trial Magazine (May 2000), reprinted in Jeffrey A. Parness, Civil Procedure in State and Federal Courts (2001)

Unconscionable Predispute Arbitration Provisions in Construction Contracts, Molds: A Mold Property and Personal Injury Magazine 51 (October 2002)(with Paul Y. Castle)

Unconscionable Lawyers,  19 Georgia St. L. Rev. 361 (2002)

Revocability of Contract Provisions Controlling Resolution of Future Disputes (with Paul Castle)67 L&CP 207 (2004)

Mandatory Arbitration Clauses: Time to Revise FAA,  National Law Journal, July 30, 2007 at 12.