You know, you're right. I was imprecise. Let me restate:
Just so you know ahead of time: no company you do business with that has actual counsel is going to accept an arbitration clause affirming an agreement to use any specific arbitrator you've chosen; in all likelihood, most real companies will flatly refuse mandatory binding arbitration.
> in all likelihood, most real companies will flatly refuse mandatory binding arbitration
That's not correct, Thomas. All kinds of big and small companies include mandatory binding arbitration provisions in B2B and especially B2C contracts.
(In B2C contracts, a big part of the appeal of an arbitration provision is that the U.S. Supreme Court recently said, in AT&T Mobility v. Concepcion [1], that B2C contracts can essentially eliminate consumer class-action lawsuits by requiring individual arbitrations and jumping through a few minor hoops.)
I don't mean to dispute that B2B contracts often include arbitration clauses (though obviously I did just that; sorry). Clearly they do. I'm disputing that an (e.g.) freelancer has a chance in hell of getting arbitration into a real company's master agreement that didn't already include arbitration.
You're the expert: what do you think the odds are here? My experience is limited to watching the redlines ping-pong over simple choice of state law in our own contracts.
I think this is a cool idea for a business, by the way.
If I were representing the "real company" Thomas mentions, I would absolutely recommend that my client consider a suitably-designed arbitration provision for a freelance designer agreement.
Not least, I'd welcome the chance to put disputes into an informal, comparatively-inexpensive forum, where the risk of a runaway jury deciding the case mainly out of sympathy for the freelancer is essentially eliminated.
I would almost certainly object, though, to the ex aequo et bono standard that judge.me proclaims --- that standard, in essence, gives the arbitrator carte blanche to do whatever seems good in his or her eyes, regardless what the contract or the law says. That, coupled with the extremely-limited right of appeal of arbitration decisions, could definitely be a show-stopper.
For those interested, as part of the materials for a law-school course I teach, I've posted an extensively-annotated model arbitration provision [1].
[Disclosure: My wife is a full-time labor- and employment arbitrator.]
Also: in a professional services context? It's your experience that mutual binding arbitration is common in B2B professional services contexts? My thinking here: even a website redesign puts outside people into contact with confidential business information, poachable employees, company IP, and liability if the website e.g. includes IP from other companies.
> It's your experience that mutual binding arbitration is common in B2B professional services contexts?
It's certainly not uncommon.
> even a website redesign puts outside people into contact with confidential business information, poachable employees, company IP, and liability if the website e.g. includes IP from other companies.
All the more reason for arbitration, which by agreement can be made private and confidential, whereas confidentiality in litigation can be very dicey under open-court laws [1].
I've signed many contracts in my life that included an agreement to use a specific court in case of legal action. I'm in Europe, maybe that's unusual in the States?
Lawyers functioning as counsel for real companies will either (a) demand their own choice of law or (b) accept from a small list of known-acceptable choices of law.
It's hard to imagine any corporate counsel ever accepting binding arbitration using an arbitrator they hadn't hand-selected; with choice of arbitration rules comes concessions regarding discovery, regarding appeal, fees, rules of evidence, potentially regarding maximum awardable damages, the list goes on & on.
Choice of arbitration procedures is a much bigger wild card than choice of governing state law. An arbitration clause is more or less a binding promise not to sue, but instead resolve any dispute under an opaque and drastically simplified set of rules. Arbitration clauses are also, as far as I can tell, very much more enforceable when they occur in contracts between businesses.
This sounds like an obvious win when the dispute is over at most 5 figures of web site design; who would want to deal with years of court drama over that? The problem is, real lawyers won't be thinking of the 5 figure contractual amount; they'll instead be thinking of things like liability and IP protection, which are issues that can be denominated in sums that dwarf legal process costs.
Of course this is meant for cases where both parties do not have dedicated counsel; if they did, then they wouldn't shy away from international court in the first place, right? If judge.me doesn't screw up (which they easily could), I can envision them slowly growing, slowly spreading by word of mouth through the legal world, until they get on the "short list" of known-acceptable choices of law you mentioned.
I think it's a neat idea! More so the more I think about it, too. I'm just saying: if you stick it in your template master agreement, corp lawyers may bitch at you.
Just so you know ahead of time: no company you do business with that has actual counsel is going to accept an arbitration clause affirming an agreement to use any specific arbitrator you've chosen; in all likelihood, most real companies will flatly refuse mandatory binding arbitration.