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Arbitration a Creature of Statute More than Contract?

One of the justifications traditionally advanced in favor of arbitration is that it gives the parties to a potential dispute the freedom to select the manner in which such a dispute would be resolved. Thus, parties can choose the forum for arbitration, and can limit the issues they submit to arbitration. One of the fears that is sometimes expressed about arbitration, however, is that the parties are almost completely at the mercy of the arbitrator they have chosen. They have very limited ability to obtain review of an arbitration decision that is unsupported by the law or the evidence. So the question has arisen whether parties can creatively design a system that combines some of the features of arbitration (e.g., limited discovery and simplified procedures) with some features of the judicial process (a genuine right to appeal an arbitrator’s decision that cannot be supported on the law or the facts).

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