The AAA’s New Discovery Best Practices
The American Arbitration Association (“AAA”) released recommendations for AAA Construction Advocates and Arbitrators with regard to best discovery practices and tips for Construction Arbitration (“Best Practices”). The 7-page guideline provides a bullet point, practical summary of information exchange in arbitration. It is a helpful resource to counsel, clients, and arbitrators to understand the ground rules in an arbitration proceeding.
Generally, parties are entitled to examine an opposing partie’s documents; however, “the scope of documents should be narrowly tailored and proportionate to the disputes at hand.” To achieve this goal, parties should each submit detailed statement of claims and defenses as early as possible to narrow the issues, identify critical documents, and limit or avoid any disputes over document production. The parties should be encouraged to exchange such information candidly. Additionally, a scheduling order should establish deadlines for exchanging documents and can and should be strictly enforced absent good cause to deviate.
While site inspections can be beneficial in a construction dispute, arbitrators should consider whether the current condition of the project is such that an inspection would help understand and resolve the issues in the dispute. If a site visit is necessary, the practice tips for arbitrators include reviewing project photographs to familiarize with the issues and having the parties conduct the tour without attorney argument or commentary.
Due to “the growing use and sheer volume of email, CAD drawings and scheduling information in construction projects,” documents that are maintained and stored electronically should be provided in the same manner they are maintained, and be crafted to make searching the electronic data as economical and expeditious as possible.
As depositions are generally time consuming and costly, their use in arbitration should typically only be used when “clear and compelling grounds are demonstrated that depositions will promote (and not compromise) the speed and efficiency of the arbitration.” The practice tips provided for arbitrators include considering whether imposing a time limit on depositions and limiting the depositions to the primary fact-witnesses each party intends to call.
In order to avoid unnecessary correspondence, briefing, and time, the Best Practices provides that arbitrators should make clear at the pre-hearing conference that parties are to engage in good-faith discussions to resolve discovery disputes before bringing them to the attention of the arbitrator. In the event that such a dispute does arise, the dispute should be resolved by telephonic conference at or near the time of dispute.
Arbitrators are vested with the authority to order sanctions; however, in doing so, they should order them judiciously and avoid “drastic” sanctions whenever possible.
Generally, the AAA rules do not contemplate third-party document discovery. The best practices advises that arbitrators “should be aware that this area is constantly evolving.” The practice tips note that the arbitrator should give consideration to the cost and burden on the third-party and that any subpoena should be narrowly tailored.
The Best Practices publication provides a helpful tool for practitioners and arbitrators to ensure that arbitration is more focused and efficient than court proceedings.