法律英语：03 Arbitration Clauses

by Michael W. Flynn
 
First, a disclaimer: Although I am an attorney, the legal information in this podcast is not intended to be a substitute for seeking personalized legal advice from an attorney licensed¹ to practice in your jurisdiction². Further, I do not intend to create an attorney-client relationship with any listener.  
 
Today, I will discuss arbitration³ clauses. An anonymous⁴ caller asked,
 
How can cell phone companies and car rental⁵ places force someone to arbitrate? Don’t we have a right to a jury trial in America?
 
Mark from California wrote,
 
It seems every doctor I see asks me to sign a "physician-patient
arbitration agreement" which clearly states it's a "contract to have
any issue of medical malpractice decided⁶ by neutral arbitration and
you are giving up your right to a jury or court trail."
 
Obviously, doctors want to avoid being sued for malpractice. What is
your view of what patients have given up, and what might individual
patients do? Will arbitration adequately protect patients’ rights?
 
Thanks for the great questions. Most of us have signed contracts such as cell phone agreements that contain these arbitration clauses. Today, I will discuss what an arbitration clause is, when it is binding⁷, and briefly⁸ answer Mark’s questions. The short answers are that arbitration clauses effectively waive⁹ your right to a jury, and most arbitration clauses today are enforceable.      
 
An arbitration clause is simply a clause in a contract that binds¹⁰ both parties to arbitration should a dispute arise out of the contract. These clauses are generally enforceable as contract terms that you agreed to. Arbitration is a form of dispute resolution, agreed on by all parties, in which one or more neutral arbitrators hear evidence from the parties, and give an award based on that evidence. It is basically a substitute for going to court and presenting your evidence to a jury or judge. Most often, the arbitrator’s decision is final and cannot be appealed. Arbitration is often cheaper than going to trial, and many arbitration clauses require that any grievance¹¹ you have must remain confidential¹². By contrast, court proceedings¹³ are public.  
 
First, turning to our caller’s question about the right to a jury trial. The Seventh Amendment¹⁴ to the United States Constitution provides: “In Suits at common law, where the value in controversy¹⁵ shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury shall be otherwise re–examined in any Court of the United States, than according to the rules of the common law.” On its face, this text seems to say that you get a jury if you want it. That is true. However, the right to a jury trial is waiveable. When you sign an arbitration agreement, you are effectively waiving¹⁶ your constitutional right to a jury. So, if the arbitration clause is valid¹⁷, then you no longer have right to a jury trial in that case.
 
But, as Mark’s question suggests, these arbitration clauses do not seem fair because you do not always have a choice. Mark has basically asked, “When does an arbitration agreement become so unfair that it is not enforceable?”   
 
There are several reasons that a contract is not enforceable. The one that Mark has hit upon is called unconscionability, which basically means grossly unfair. While the law varies from state to state, a contract is unconscionable, and thus unenforceable, where there are both unfair procedural and unfair substantive¹⁸ elements. Procedural unconscionability exists when either inequality of bargaining power or surprise prevents real negotiation¹⁹ or assent²⁰. Substantive unconscionability exists when one-sided or oppressive terms have been imposed.
 
Applying this rubric to Mark’s situation, it is clear that there is an element of procedural unconscionability because the doctor has a superior bargaining position than the patient. When a patient comes into a doctor’s office, he is typically sick, and needs the services of that doctor. Also, the patient does not usually have the luxury of shopping around because most insurance carriers limit which doctors you may see. Last, the doctor simply hands you the contract with the arbitration clause in it, and you take it or leave it. If you do not agree to the arbitration clause, the doctor will not treat you. Take it or leave it contracts like this are sometimes referred to as “contracts of adhesion.” 
 
Turning to the question of substantive unconscionability, courts that are reviewing your arbitration agreement will generally inquire into the bilateral²¹ nature of the agreement. That is, the question is whether the arbitration clause contains the same benefits and burdens for both parties. So, arbitration clauses that give the doctor the right to choose the arbitrator at his discretion²², or allow the doctor to choose which law will apply, are substantively²³ unconscionable. Most companies are smart enough to write their arbitration clauses such that they grant the same rights under the clause to both parties. So, if the doctor’s arbitration clause provided that Florida law would apply, and that the arbitrator will be selected at random²⁴ from the American Arbitration Association, then that arbitration clause is fair to both of you. It might turn out that Florida law is less kind to patients, but the clause is considered fair because the same law applies to both parties.
 
In the end, most standard arbitration agreements are enforceable when you sign them, have notice of the terms, and the terms are the same for both parties.
 
Mark also asked what individual patients could do. Well, if the dispute arises out of one patient’s specific problems with the doctor, then the arbitration clause will likely be enforced. But, where a large class of patients has the same dispute with the same doctor, then those patients might consider a class action lawsuit²⁵. Several courts have held that an arbitration clause that bans class action lawsuits²⁶ is substantively unfair and oppressive. Some courts have held the opposite.

Last, Mark asked whether arbitration will protect patients’ rights. This is a very complex question that I do not have time to answer today. But, I will say this: most arbitrators are highly respected lawyers and retired²⁷ judges who are well trained, and uphold their duty to apply the law objectively. So long as you have a decent attorney and a decent arbitrator, you have a very good chance at receiving the award you would if you tried your case in court. The major downside is the confidentiality²⁸ clauses that many agreements contain. This confidentiality might stop you from telling your story to the world as a warning to others.

Thank you for listening to Legal Lad’s Quick and Dirty Tips for a More Lawful²⁹ Life. Be sure to check out all the excellent Quick and Dirty Tips podcasts at QuickAndDirtyTips.com.
 
You can send questions and comments to。。。or call them in to the voicemail line at 206-202-4LAW. Please note that doing so will not create an attorney-client relationship and will be used for the purposes of this podcast only.
 
Legal Lad's theme music is "No Good Layabout" by Kevin MacLeod.
 

1 licensed   

adj.得到许可的v.许可，颁发执照(license的过去式和过去分词)

参考例句：

• The new drug has not yet been licensed in the US. 这种新药尚未在美国获得许可。
• Is that gun licensed? 那支枪有持枪执照吗？

2 jurisdiction   

n.司法权，审判权，管辖权，控制权

参考例句：

• It doesn't lie within my jurisdiction to set you free.我无权将你释放。
• Changzhou is under the jurisdiction of Jiangsu Province.常州隶属江苏省。

3 arbitration   

n.调停，仲裁

参考例句：

• The wage disagreement is under arbitration.工资纠纷正在仲裁中。
• Both sides have agreed that the arbitration will be binding.双方都赞同仲裁具有约束力。

4 anonymous   

adj.无名的；匿名的；无特色的

参考例句：

• Sending anonymous letters is a cowardly act.寄匿名信是懦夫的行为。
• The author wishes to remain anonymous.作者希望姓名不公开。

5 rental   

n.租赁，出租，出租业

参考例句：

• The yearly rental of her house is 2400 yuan.她这房子年租金是2400元。
• We can organise car rental from Chicago O'Hare Airport.我们可以安排提供从芝加哥奥黑尔机场出发的租车服务。

6 decided   

adj.决定了的，坚决的；明显的，明确的

参考例句：

• This gave them a decided advantage over their opponents.这使他们比对手具有明显的优势。
• There is a decided difference between British and Chinese way of greeting.英国人和中国人打招呼的方式有很明显的区别。

7 binding   

有约束力的，有效的，应遵守的

参考例句：

• The contract was not signed and has no binding force. 合同没有签署因而没有约束力。
• Both sides have agreed that the arbitration will be binding. 双方都赞同仲裁具有约束力。

8 briefly   

adv.简单地，简短地

参考例句：

• I want to touch briefly on another aspect of the problem.我想简单地谈一下这个问题的另一方面。
• He was kidnapped and briefly detained by a terrorist group.他被一个恐怖组织绑架并短暂拘禁。

9 waive   

vt.放弃，不坚持(规定、要求、权力等)

参考例句：

• I'll record to our habitat office waive our claim immediately.我立即写信给咱们的总公司提出放弃索赔。
• In view of the unusual circumstances,they agree to waive their requirement.鉴于特殊情况，他们同意放弃他们的要求。

10 binds   

v.约束( bind的第三人称单数 )；装订；捆绑；（用长布条）缠绕

参考例句：

• Frost binds the soil. 霜使土壤凝结。 来自《简明英汉词典》
• Stones and cement binds strongly. 石头和水泥凝固得很牢。 来自《简明英汉词典》

11 grievance   

n.怨愤，气恼，委屈

参考例句：

• He will not easily forget his grievance.他不会轻易忘掉他的委屈。
• He had been nursing a grievance against his boss for months.几个月来他对老板一直心怀不满。

12 confidential   

adj.秘（机）密的，表示信任的，担任机密工作的

参考例句：

• He refused to allow his secretary to handle confidential letters.他不让秘书处理机密文件。
• We have a confidential exchange of views.我们推心置腹地交换意见。

13 proceedings   

n.进程，过程，议程；诉讼(程序)；公报

参考例句：

• He was released on bail pending committal proceedings. 他交保获释正在候审。
• to initiate legal proceedings against sb 对某人提起诉讼

14 amendment   

n.改正，修正，改善，修正案

参考例句：

• The amendment was rejected by 207 voters to 143.这项修正案以207票对143票被否决。
• The Opposition has tabled an amendment to the bill.反对党已经就该议案提交了一项修正条款。

15 controversy   

n.争论，辩论，争吵

参考例句：

• That is a fact beyond controversy.那是一个无可争论的事实。
• We ran the risk of becoming the butt of every controversy.我们要冒使自己在所有的纷争中都成为众矢之的的风险。

16 waiving   

v.宣布放弃( waive的现在分词 )；搁置；推迟；放弃（权利、要求等）

参考例句：

• Other steps suggested included waiving late payment charges, making quicker loan decisions and easing loan terms. 其他测试还包括免去滞纳金，尽快做出贷款决定和放宽贷款条件。 来自互联网
• Stuyvesant Town offers the same perk on some apartments, along waiving the broker's fee. StuyvesantTown对于他们出租的某些房子也提供同样的好处，顺带还省略了中介费。 来自互联网

17 valid   

adj.有确实根据的；有效的；正当的，合法的

参考例句：

• His claim to own the house is valid.他主张对此屋的所有权有效。
• Do you have valid reasons for your absence?你的缺席有正当理由吗？

18 substantive   

adj.表示实在的；本质的、实质性的；独立的；n.实词，实名词；独立存在的实体

参考例句：

• They plan to meet again in Rome very soon to begin substantive negotiations.他们计划不久在罗马再次会晤以开始实质性的谈判。
• A president needs substantive advice,but he also requires emotional succor. 一个总统需要实质性的建议，但也需要感情上的支持。

19 negotiation   

n.谈判，协商

参考例句：

• They closed the deal in sugar after a week of negotiation.经过一星期的谈判，他们的食糖生意成交了。
• The negotiation dragged on until July.谈判一直拖到7月份。

20 assent   

v.批准，认可；n.批准，认可

参考例句：

• I cannot assent to what you ask.我不能应允你的要求。
• The new bill passed by Parliament has received Royal Assent.议会所通过的新方案已获国王批准。

21 bilateral   

adj.双方的，两边的，两侧的

参考例句：

• They have been negotiating a bilateral trade deal.他们一直在商谈一项双边贸易协定。
• There was a wide gap between the views of the two statesmen on the bilateral cooperation.对双方合作的问题，两位政治家各自所持的看法差距甚大。

22 discretion   

n.谨慎；随意处理

参考例句：

• You must show discretion in choosing your friend.你择友时必须慎重。
• Please use your best discretion to handle the matter.请慎重处理此事。

23 substantively   

adv.真实地；实质上

参考例句：

• WTO-consistency had to be secured substantively as well. 与WTO的一致性还必须获得实质性的保证。 来自互联网
• What is called quantum information science is substantively to research information science encoding with quantum states. 量子信息学是近几年迅速发展起来的一门新兴交叉学科，它是量子力学和信息科学相结合的产物。 来自互联网

24 random   

adj.随机的；任意的；n.偶然的(或随便的)行动

参考例句：

• The list is arranged in a random order.名单排列不分先后。
• On random inspection the meat was found to be bad.经抽查，发现肉变质了。

25 lawsuit   

n.诉讼，控诉

参考例句：

• They threatened him with a lawsuit.他们以诉讼威逼他。
• He was perpetually involving himself in this long lawsuit.他使自己无休止地卷入这场长时间的诉讼。

26 lawsuits   

n.诉讼( lawsuit的名词复数 )

参考例句：

• Lawsuits involving property rights and farming and grazing rights increased markedly. 涉及财产权，耕作与放牧权的诉讼案件显著地增加。 来自辞典例句
• I've lost and won more lawsuits than any man in England. 全英国的人算我官司打得最多，赢的也多，输的也多。 来自辞典例句

27 retired   

adj.隐退的，退休的，退役的

参考例句：

• The old man retired to the country for rest.这位老人下乡休息去了。
• Many retired people take up gardening as a hobby.许多退休的人都以从事园艺为嗜好。

28 confidentiality   

n.秘而不宣，保密

参考例句：

• They signed a confidentiality agreement. 他们签署了一份保守机密的协议。
• Cryptography is the foundation of supporting authentication, integrality and confidentiality. 而密码学是支持认证、完整性和机密性机制的基础。

29 lawful   

adj.法律许可的，守法的，合法的

参考例句：

• It is not lawful to park in front of a hydrant.在消火栓前停车是不合法的。
• We don't recognised him to be the lawful heir.我们不承认他为合法继承人。