The American Arbitration Association's (AAA) newly updated Construction Industry Arbitration Rules went into effect July 1, 2015. The updated rules include more than a dozen changed or new provisions intended to produce a more streamlined, cost-effective and tightly managed process.
Basically, the AAA rules provide three tracks for arbitration pursuit, based on the value of the disputed amount. A fourth track allows for a decision regardless of amount, but to be submitted for a ruling by a single arbitrator based upon the the submission of relevant documents and written argument (i.e., no hearing). The importance of mediation has always been recognized by the AAA, but in the past, mediation was a perquisite to arbitration, which could result in delays to arbitration. One of the important changes in the new rule is that mediation is no longer a perquisite, but shall be conducted concurrently with arbitration.
Most of the other changes implemented serve the purpose of expediting processes such as document production and giving the arbitrator(s) more control in making decisions that can reduce delays as well as reduce cost burdens on the parties, including:
- Consolidation and joinder time frames and filing requirements to streamline these increasingly involved issues in construction arbitrations.
- New preliminary hearing rules to provide more structure and organization to get the arbitration process on the right track from the beginning.
- Information exchange measures to give arbitrators a greater degree of control to limit the exchange of information, including electronic documents.
- Availability of emergency measures of protection in contracts that have been entered into on or after July 1, 2015.
- Enforcement power of the arbitrator to issue orders to parties that refuse to comply with the Rules or the arbitrator’s orders.
- Permissibility of dispositive motions to dispose of all or part of a claim or to narrow the issue in a claim.
To download a copy of the revised Rules, click here. For further review and analysis, we recommend Dan Douglass's article at the Stites & Harbison site.