ISRI established an arbitration service as a means to enable members to use arbitration to resolve disputes.
ISRI arbitration is a voluntary procedure and must be agreed upon by both parties in the dispute. It is not required that both parties to the dispute be ISRI members.
The complete procedure for arbitration is set forth in ISRI’s “Rules for Arbitration,” which are available from Association headquarters in Washington, D.C. The rules contain the necessary form that must be completed to initiate arbitration. ISRI treats all filings, awards, and proceedings as confidential.
The rules are highlighted below:
1. Anyone may propose arbitration in a dispute, though at least one party must be a member of the association. Both parties must agree to the arbitration by signing a “Submission to Arbitrate” form and agreeing to abide by the applicable Arbitration Rules.
2. A panel of arbitrators has been established by the association. The arbitrators serve without compensation, except for reasonable expenses. The arbitration parties must draw their arbitrators from the panel. A maximum of three arbitrators can be issued in any proceeding; the parties are encouraged to use a single arbitrator.
3. There is a specific schedule of fees listed in the “Rules for Arbitration.” Each party must deposit with the association in advance $500 plus $500 for each arbitrator. The total deposit for each party thus is either $1,000 or $2,000, depending on whether one arbitrator is to be used or three. A portion of the fee is refundable if not required to defray arbitrators’ costs. The arbitrators may require the losing party to reimburse the prevailing party for its share of these costs.
4. The arbitration procedure usually includes a hearing, at which time the parties involved are required to appear, present their respective cases, and be available for questioning by the arbitrator(s). All physical evidence (contracts, correspondence, relevant comments, etc.) may be required to be submitted in advance to the arbitrators. A party in the arbitration may be accompanied by counsel but must inform the other party in advance and receive permission from the arbitrators. Witnesses may also be called to an arbitration hearing. There is also an optional procedure for conducting the arbitration without an oral hearing.
5. An award by the arbitrator(s) will be made promptly, within 20 days after hearings have been completed or final briefs submitted. The award is made in writing.
6. The rules state that the parties to the dispute shall be deemed to have consented that a judgment upon the award be entered in any court having jurisdiction over an action to enforce the award.
Members who wish to provide an automatic basis for the settlement of any disputes arising from a transaction are encouraged to provide in their contracts that the ISRI Arbitration Procedure shall prevail in the event of any ensuing controversy and that each party will take all necessary steps to initiate such arbitration. Members are urged to obtain and carefully read the “Rules for Arbitration” before proceeding.
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