Abell's Kentucky Law Blog

Fairness of Consumer Arbitration Procedures Questioned

    Business Week reports in "Banks vs. Consumers (Guess Who Wins)" that National Arbitration Forum (NAF), one of the country's largest for-profit arbitration companies courts corporations against consumers by claiming that it will enable credit card companies to markedly increase their recovery rates over their existing collection methods.  Business Week also reports that NAF marketing materials brag that creditors may use NAF procedural maneuvers to tilt the process in their favor.  A Harvard Law School professor testified under oath that she found NAF processes so unfair and biased that she resigned as an NAF arbitrator, Business Week also reports.  Arbitration provisions are contained in many consumer agreements and many consumers unknowingly and unwittingly agree to submit a dispute to be decided by an arbitrator.  There are strong incentives for arbitration companies to favor the corporations that are their best customers.  Ask yourself: what if a judge solicited cases from big corporations by offering them a business-friendly venue to resolve their disputes with consumers and individuals?  Would that be fair? 

Robert L. Abell
www.RobertAbellLaw.com

It Is Presumed That You Have Given Up Your Constitutional Rights

As a general rule, before a court concludes that an individual has given up or waived an important right it must be demonstrated that the individual was fully and adequately informed of the existence of the right, that the individual understood what that right meant in practice, that the individual knew that whatever they were about to say or sign or do would cause them to give up that right and that the individual knowingly and voluntarily gave up the right.  There is, as a general rule, a presumption against the notion that an individual has given up an important right.

It says here that among our most important rights is trial by jury.  But don't take my word for it.  The Seventh Amendment to the United States Constitution preserves the right to trial by jury; Section 7 of the Kentucky Constitution states: "The ancient mode of trial by jury shall be held sacred, and the right thereof remain inviolate, subject to such modifications as may be authorized by this Constitution." 

Increasingly in recent years businesses and employers have sought to evade the very possibility that they will be held responsible by a jury for their misconduct by demanding that employees and consumers arbitrate any dispute of any kind that they may have with them.  Consumers that sign lengthy and complex form agreements find that in the teeny-tiny fine print that they have waived their right to trial by jury and agreed to arbitration.  Employees that are sent an e-mail stating that their employer has adopted a new policy of arbitrating any and all employment-related disputes including employment discrimination claims and show up for work the next day are deemed to have given up their right to trial by jury.  It is estimated by the National Employment Lawyers Association that up to one-fifth of workers (approximately 30 million people) are subject to arbitration agreements in their jobs.  Furthermore, courts rule that if there is a question or close call whether an individual has agreed to arbitration, the presumption is that they have.  In other words, it is presumed that you have given up your constitutional and sacred right to trial by jury.  Well.

Robert L. Abell
www.RobertAbellLaw.com