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Consumer Arbitration Agreements: R-53. Interpretation and Application of Rules

The arbitrator shall interpret and apply these Rules as they relate to the arbitrator’s powers and duties. When there is more than one arbitrator and a difference arises among them concerning the meaning or application of these Rules, it shall be decided by a majority vote. If that is not possible, either an arbitrator or a party may refer the question to the AAA for final decision. All other Rules shall be interpreted and applied by the AAA.

Consumer Arbitration Agreements: R-54. Remedies for Nonpayment

(a) If arbitrator compensation or administrative charges have not been paid in full, the AAA may inform the parties so that one of them may forward the required payment.

(b) Once the AAA informs the parties that payments have not been received, a party may request an order from the arbitrator directing what measures might be taken in light of a party’s nonpayment.

Consumer Arbitration Agreements: R-55. Declining or Ceasing Arbitration

The AAA in its sole discretion may decline to accept a Demand for Arbitration or stop the administration of an ongoing arbitration due to a party’s improper conduct, including threatening or harassing behavior towards any AAA staff, an arbitrator, or a party or party’s representative.

Consumer Arbitration Agreements: Costs of Arbitration

Where the AAA determines that a business’s failure to pay their portion of arbitration costs is a violation of the Consumer Arbitration Rules, the AAA may decline to administer future consumer arbitrations with that business.

Consumer Arbitration Agreements: D-1. Applicability

(a) In any case, regardless of claim size, the parties may agree to waive in-person/telephonic hearings and resolve the dispute through submission of documents to one arbitrator. Such agreement should be confirmed in writing no later than the deadline for the filing of an answer.

(b) Where no disclosed claims or counterclaims exceed $25,000, the dispute shall be resolved by these Procedures, unless a party asks for a hearing or the arbitrator decides that a hearing is necessary.

Consumer Arbitration Agreements: D-2. Preliminary Management Hearing

Within 14 calendar days of confirmation of the arbitrator’s appointment, the arbitrator shall convene a preliminary management hearing, via conference call, video conference, or internet, to establish a fair and equitable procedure for the submission of documents, and, if the arbitrator deems appropriate, a schedule for one or more telephonic or electronic conferences.

Consumer Arbitration Agreements: D-4. Time of Award

(a) The arbitrator shall establish the date for either final written submissions or a final telephonic or electronic conference. Such date shall operate to close the hearing, and the time for the rendering of the award shall commence on that day as well.

(b) The arbitrator shall render the award within 14 calendar days from the date the hearing is closed.

(c) The award is subject to all other provisions of these Rules that pertain to awards.

Consumer Arbitration Agreements: Table of Contents

Statement of Principles of the National Consumer Disputes Advisory Committee

Statement of Principles

Introduction: Genesis of the Advisory Committee

Scope of the Consumer Due Process Protocol

Glossary of Terms

Major Standards and Sources

Principle 1. Fundamentally-Fair Process

Principle 2. Access to Information Regarding ADR Program

Principle 3. Independent and Impartial Neutral; Independent Administration

Principle 4. Quality and Competence of Neutrals

Principle 5. Small Claims

Consumer Arbitration Agreements: Statement of Principles

PRINCIPLE 1. FUNDAMENTALLY-FAIR PROCESS

All parties are entitled to a fundamentally-fair ADR process. As embodiments of fundamental fairness, these Principles should be observed in structuring ADR Programs.

PRINCIPLE 2. ACCESS TO INFORMATION REGARDING ADR PROGRAM

Consumer Arbitration Agreements: Introduction: Genesis of the Advisory Committee

Recent years have seen a pronounced trend toward incorporation of out-of-court conflict resolution processes in standardized agreements presented to consumers of goods and services. Some of these processes (such as mediation and non-binding evaluation) involve third party intervention in settlement negotiations; others involve adjudication (binding arbitration). Such processes have the potential to be of significant value in making dispute resolution quicker, less costly, and more satisfying.6

Consumer Arbitration Agreements: Scope of the Consumer Due Process Protocol

The Consumer Due Process Protocol (Protocol) was developed to address the wide range of consumer transactions—those involving the purchase or lease of goods or services for personal, family or household use. These include, among other things, transactions involving: banking, credit cards, home loans and other financial services; health care services; brokerage services; home construction and improvements; insurance; communications; and the purchase and lease of motor vehicles and other personal property.

Consumer Arbitration Agreements: Glossary of Terms

Consumer

Consumer refers to an individual who purchases or leases goods or services, or contracts to purchase or lease goods or services, intended primarily for personal, family or household use.

Provider

Provider refers to a seller or lessor of goods or services to Consumers for personal, family or household use.

ADR Process

Consumer Arbitration Agreements: Major Standards and Sources

The Reporter’s Comments accompanying these Principles cite a number of existing standards and sources relied upon by the Advisory Committee. The more frequently cited standards and sources are set forth below by their full title as well as the abbreviated title that appears in the Comments.

American Arbitration Association, Commercial Arbitration Rules, July 1, 1996 (AAA Commercial Rules)

American Arbitration Association, Construction Industry Dispute Resolution Procedures, Oct. 15, 1997 (AAA Construction Procedures)

Consumer Arbitration Agreements: Principles 1—15

PRINCIPLE 1. FUNDAMENTALLY-FAIR PROCESS

All parties are entitled to a fundamentally-fair ADR process. As embodiments of fundamental fairness, these Principles should be observed in structuring ADR Programs.

Reporter’s Comments

Consumer Arbitration Agreements: Signatories

A DUE PROCESS PROTOCOL FOR MEDIATION AND ARBITRATION OF CONSUMER DISPUTES

Dated: April 17, 1998

Some of the signatories to this Protocol were designated by their respective organizations, but the Protocol reflects their personal views and should not be construed as representing the policy of the designating organizations.

The Honorable Winslow Christian

Co-chair

Justice (Retired)

California Court of Appeal

William N. Miller

Consumer Arbitration Agreements: C.4 Consumer Debt Collection Arbitrations

Notice on Consumer Debt Collection Arbitrations

On October 19, 2010, the National Task Force on the Arbitration of Consumer Debt Collection Disputes released the Consumer Debt Collection Due Process Protocol Statement of Principles. That Protocol sets forth a number of important principles that need to be addressed and incorporated into consumer debt collection arbitration programs to help ensure that a fair and adequate arbitration process is made available to the parties.

Consumer Class Actions: Attorneys’ Fees

The California Supreme Court recently reaffirmed the propriety of calculating fees as a percentage of the common fund made available to the class. Laffitte v. Robert Half Int’l Inc. (2016) 1 Cal. 5th 480, 485. The court affirmed the fee award of one-third of the common fund, holding that trial courts have further discretion to conduct a lodestar cross-check or forgo the lodestar analysis and use other means to evaluate the reasonableness of the requested fee percentage. Id. at 506. The mandate from Serrano v.

Consumer Class Actions: Standing to Appeal a Class Settlement Requires Intervention

In Hernandez v. Restoration Hardware, Inc., 4 Cal. 5th 260, 270 (2018), the California Supreme Court held that class members who object to a settlement need to intervene in the action to have standing to appeal any aspect of the settlement.

In contrast, the United States Supreme Court recently resolved a split of federal authority and unequivocally rejected intervention as a prerequisite for class member appeal and, instead, held that any class member who appears and objects before the trial court has standing to appeal:

Consumer Class Actions: Exception for stayed PAGA claims

However, dismissal of class claims is not appealable where the plaintiff continues to pursue a PAGA claim and individual arbitration, because there is no de facto final judgment for absent plaintiffs and thus no death knell effect. Young v. Remx, Inc. (2016) 2 Cal. App. 5th 630, 633. See also Nguyen v. Applied Med. Res. Corp. (2016) 4 Cal. App. 5th 232, 240.

Consumer Class Actions: Pre-Certification Discovery

California courts recognize the parties’ right to conduct appropriate pre-certification discovery. (Best Buy Stores, L.P. v. Superior Court (2006) 137 Cal. App. 4th 772 [40 Cal. Rptr. 3d 578]; Bartold v. Glendale Federal Bank (2000) 81 Cal. App. 4th 816, 827 [97 Cal. Rptr. 2d 226] (“[D]ue process requires ‘an opportunity to conduct discovery on class action issues before . . . documents in support of or in opposition to the motion must be filed . . .’ ”) quoting Carabini v. Superior Court (1994) 26 Cal. App. 4th 239, 243-244) [31 Cal. Rptr.