By: Leslie W. Langbein, Esq.
LANGBEIN ADR SERVICES
Most attorneys approach an employment arbitration hearing as if it was a bench trial. That mindset is quite helpful in preparing the case; however its presentation requires adjustments in strategy and style. This article explores why practitioners ought to reconsider how they present testimony and evidence at an arbitration hearing to best advance their clients’ interests.
Arbitration is valued because of its privacy, the ability to select a truly neutral trier of fact with subject matter expertise, and the efficiency and finality of the process. Unlike litigation, the parties have significant input into how their case will be administered and tried. Of course, there are drawbacks as well. Arbitrators are granted enormous latitude in the manner in which they conduct hearings and decide discovery disputes. Review by courts is limited: an award will be upheld if it “draws its essence” from the contract and/or the law. And, because the burden of meeting a statutory ground for vacatur is high, arbitration awards generally are deemed final and binding. Thus, a practitioner’s primary goal during an arbitration proceeding should be to influence the arbitrator to exercise that broad discretion in his/her client’s favor.
Many aspects of an arbitrator’s handling of an arbitration proceeding are influenced by the administering tribunal. For example, the mantra of every American Arbitration Association (“AAA”) arbitrator is “speed, efficiency, and cost containment.” The AAA periodically evaluates its arbitrators for their ability to achieve these goals. It, therefore, stands to reason that arbitrators expect parties who appear before them to cooperate in fulfilling these obligations to the process. Litigators who consciously employ delay and other obstructive tactics to undermine these objectives do little to help their client’s case and allow arbitrators to the opportunity to draw adverse inferences. This is not to say that practitioners cannot and should not vigorously represent their clients’ interests when there is a reasonable basis for doing so. Zealous practitioners who are guided by principles of fairness and professionalism generally fare well in arbitration.
Practitioners also should be mindful that most tribunals strive to create and maintain a “sterile” environment for arbitration. Tribunal rules and codes of ethics require arbitrators to provide a full disclosure of all actual or potential conflicts of interest with parties, their attorneys and witnesses in a case. One of the worst “sins” an arbitrator can commit is to conceal or simply fail to disclose a prior relationship that may actually compromise neutrality or create the “appearance” of non-neutrality. Ex-parte communications between a party and an arbitrator are verboten. Therefore, attempts to curry favor with an arbitrator or to create an impression of a special relationship with the arbitrator for the benefit of the opposing party are as much unappreciated as a lack of respect.
Keep in mind that arbitrators also function as the “courtroom deputy” at hearing. They must track exhibits, the identity and order of witnesses, evidentiary objections, the dates and times of each session and their rulings all the while listening to testimony or considering evidence. This record-keeping function can easily divert an arbitrator’s attention from the case in chief in complex cases especially where reams of exhibits are presented in bulky, hard-to-handle notebooks. To make sure that an arbitrator has not missed important testimony, consider providing a court reporter to keep the official record of the hearing if the economics of the case permit it.
An effective practitioner also will consider preparing and filing a pre-hearing exhibit catalog that contains columns where the arbitrator can simply check off an exhibit’s admission into evidence, note the opposing party objections and record the arbitrator’s ruling. (The same catalog assists the practitioner to keep track of whether exhibits have been introduced into evidence). A similar list should be presented for witnesses. The date and time that has been arranged for each witness who will testify from a remote location should be designated on the practitioner’s witness list.
For the arbitrator, the only thing worse than having one bulky exhibit notebook is having two. If the arbitrator has not directed counsel to confer regarding the possibility of marking joint exhibits, by all means take the initiative. This saves time, cost and confusion at hearing, a benefit to both sides and the arbitrator. Remember to bring enough copies of all exhibits to furnish to the arbitrator, the witness, opposing counsel and the court reporter. Also keep a list of contact numbers for all witnesses so that if one witness cannot (or does not) appear at an appointed time, another is available to fill in. Avoid “down time” at all costs.
Unlike juries or judges with large dockets, arbitrators usually have a fairly good grasp of the factual and legal disputes they will decide before a hearing begins. Nevertheless, it is good practice to reinforce what an arbitrator already may think he/she knows in an opening statement.
Given that most pre-hearing interaction in arbitration is conducted via telephone or teleconference, an arbitrator may have no clue who the people are congregated in the hearing room. Opening statement should identify counsel, their clients and any witnesses present in the room. A good tool to use in opening statement is an organizational chart that ties the identity of participants in the hearing with their role in the case. As the practitioner calls each witness, he/she can be asked to identify themself on the organizational chart to strengthen the arbitrator’s association between their face and testimony. This will prove valuable later should there be a delay between the hearing and the preparation of an opinion and award.
Also consider preparing a timeline for use as a demonstrative exhibit in opening statement. It succinctly highlights the important events in a case and can be referred to by witnesses during their testimony. A secondary purpose of a timeline is that it reduces confusion when a practitioner must call some of his/her witnesses out of order. Scaled copies of the demonstrative exhibits should be provided to the arbitrator so the arbitrator can refer to them in preparing his/her opinion and award.
While a practitioner may wish to use a PowerPoint presentation as a cost-efficient means to illustrate points in opening statement, consideration should be given to their “staying power”: it is generally viewed only once. Tangible documents that an arbitrator can review over and over again during (and after) the hearing are better means of reinforcement. Of course, reliance on electronic devices during arbitration dictates that a practitioner ensure the availability of extension cords and the location of power plugs prior to hearing.
Two other thoughts: An opening statement certainly should pinpoint the present claims and defenses that will be heard by the arbitrator given these may have been amended or eliminated during case administration. And, second, as might be expected, dramatic opening statements with denigrating comments about the opposing party or its witnesses are inappropriate in arbitration. The goal of opening statement should be to provide the arbitrator with a legal basis and a good reason to rule in a party’s favor.
While the rules of evidence do not govern the admissibility of evidence in arbitration, that does not mean a practitioner can simply ignore basics like the need to establish a foundation for documents that will be introduced at hearing. If a chart or summary will be used in your case, ensure the opposing party has an opportunity to review the underlying data pre-hearing. Arbitrators are not keen on losing valuable and costly hearing time to verify the accuracy or authenticity of documents.
Rule 28 of the AAA’s Rules governing Employment Arbitration[1] allows that:
“The parties shall bear the same burdens of proof and burdens of producing evidence as would apply if their claims and counterclaims had been brought in court.” Thus, while there is no change in a claimant’s burden to prove his/her claim by a preponderance of evidence, the quality and forms of evidence that may be introduced before an arbitrator will vary dramatically from the rigid standards used in a courtroom.
The standard used by AAA arbitrators in accepting or excluding evidence is described in Rule 30 of the tribunal’s Employment Rules:
“The parties may offer such evidence as is relevant and material to the dispute and shall produce such evidence as the arbitrator deems necessary to an understanding and determination of the dispute……..
……The arbitrator shall be the judge of the relevance and materiality of the evidence offered, and conformity to legal rules of evidence shall not be necessary. The arbitrator may in his or her discretion direct the order of proof, bifurcate proceedings, exclude cumulative or irrelevant testimony or other evidence, and direct the parties to focus their presentations on issues the decision of which could dispose of all or part of the case. All evidence shall be taken in the presence of all of the arbitrators and all of the parties, except where any party is absent, in default, or has waived the right to be present.”
Two principles generally influence an arbitrator’s ruling to admit otherwise inadmissible or less reliable evidence. One is fairness and the other is the fear that his/her award will be vacated for “refusal to hear pertinent and material evidence.” Arbitrators balance these considerations by accepting less reliable evidence “for what it is worth.” On the other hand, practitioners should not presume that an arbitrator’s latitude in accepting less reliable evidence or testimony will overcome his/her client’s burden of proof.
A. Use of Affidavits
Arbitrators prefer live testimony. It is difficult to judge the credibility of witnesses from transcripts of depositions. Likewise, arbitrators rarely accord much weight to affidavits of witnesses because the party is not subject to cross-examination. This is the type of evidence that may be accepted by an arbitrator for “what it’s worth.” To the extent possible, affidavits should be limited to providing corroborative evidence.
One exception to this rule is the presentation of a party affidavit in place of direct examination. It is utilized in the following manner: Before the hearing, the practitioner prepares an affidavit that contains all the information to which his/her client would testify at the hearing to prove the case in chief. The affidavit is submitted into evidence at the hearing. The opposing party then may cross-examine the client or witness whose affidavit has been tendered. The advantages of using an affidavit in this fashion are twofold: 1) it dramatically reduces the time needed for hearing and 2) the practitioner does not have to fear having overlooked an area of inquiry under the pressure of hearing. One cautionary note on the use of affidavits in lieu of live testimony: avoid canned statements or those that are tailored to match the testimony of other witnesses. Arbitrators give very little weight to obviously scripted testimony.
B. Make Sure Evidence Does not “Weigh” Down the Hearing
The “weight” attributed to a particular piece of evidence or testimony does not increase in proportion to the number of times it is presented at hearing. One, not three corroborating witnesses, ordinarily is all that is needed to establish that a particular event or conversation took place. Restraint also should be exercised in introducing every document that was created during and through the course of an event, unless of course, they all have some greater evidentiary value such as proof of a sequence of events. The key to presentation of evidence in arbitration is quality, not quantity. If a practitioner hears an arbitrator state, “you’ve proven your point, now let’s move on” consider excusing other witnesses who will merely repeat the same testimony.
Arbitrators accord greater weight to testimony that is focused and specific. Witnesses should be familiar with the documents that will be introduced through their testimony prior to hearing. A practitioner should also anticipate that a witness’ recollection may need to be refreshed to obtain the specificity that increases his/her credibility. The timeline used in opening statement is good for this purpose. Every practitioner should always have available a calendar from the year in which relevant events took place to encourage accuracy and detail in a witness’ presentation.
C. The Use and Treatment of Objections in Arbitration
Experienced arbitrators understand that certain forms of testimony and evidence are less reliable than others. Although a practitioner may feel the need to object for the record, save hearsay objections for only it’s most rank forms, such as hearsay upon hearsay. Use standing objections to hearsay when appropriate. Likewise procedural objections such as testimony being “beyond the scope of direct” or “not the best evidence” are not favored. On the other hand, there is nothing wrong with posing objections to leading questions or a witness’ competency to answer.
One evidentiary matter that is always taken seriously by an arbitrator is the sudden production and presentation of evidence at hearing that previously was not disclosed. Like courts, arbitrators have the power to sanction a party who has concealed documents or information by refusing to admit it and drawing adverse inferences from the concealment of evidence. A wise practitioner will weigh the tactic of “surprise” against the risk of exclusion.
D. Evidence Not Available At Hearing
Occasions arise when parties or witnesses do not (or cannot) appear at the hearing or essential subpoenaed documents have not been received. The practitioner should bring such matters to the attention of the arbitrator pre-hearing or as soon as known. Arbitrators are loathe to grant postponements on the day of hearing and may, indeed, refuse to grant a postponement on this basis. In Florida, the standard for review of an arbitrator’s refusal to grant a continuance is whether the arbitrator abused his/her discretion. See, e.g. Flavio Development Corp. v Laguna East Club Condominium Ass’n, Inc, 756 So. 2d 186 (Fla. 3rd DCA 2000). To obtain such relief, the practitioner generally will be required to show that the circumstances that occasioned the need for a continuance were beyond his/her client’s control.
If such circumstances arise, better practice is to move forward with the hearing but request the arbitrator to adjourn and continue the hearing to allow for admission of the missing evidence or testimony. This may be done without the necessity of re-convening a hearing. The arbitrator may allow the parties a certain period post-hearing to tender any other relevant evidence and thereafter provide each party an opportunity to submit rebuttal evidence. Once the additional evidence is received, the evidentiary portion of the hearing is closed unless the arbitrator wishes to hear closing arguments or receive post-hearing briefs.
E. Direct and Cross Examination Combined
Given that efficiency is a hallmark of arbitration, practitioners should expect that an arbitrator will require them to ask all questions of a witness while that person is on the stand. Recalling of witnesses is frowned upon unless for pure rebuttal purposes.
F. Rebuttal Presentations
Rebuttal presentations are not an opportunity for the claimant to re-state everything to which he/she previously has testified. The arbitrator may dispense with rebuttal presentations altogether unless a witness has something extremely important to add to his/her understanding of the case.
If given a choice between providing a closing statement or a post-hearing brief, which is best? The advantage of making a closing statement is that it provides an opportunity for immediate reinforcement of a party’s position. The disadvantage is that if done at the close of a lengthy hearing, the parties and the arbitrator may be too tired to properly focus on the salient points. For this reason, post-hearing briefs allow for more cogent marshaling of the evidence and presentation of supporting case law. On the other hand, arbitrators recognized that post-hearing briefs are costly to prepare. Procedurally, they will prolong closing the hearing and also the issuance of an award. Another alternative to briefs is to ask the arbitrator to schedule a telephonic conference for post-hearing summation.
A first-time practitioner in arbitration may feel like he/she has fallen down a rabbit’s hole: there are no hard and fast rules of procedure or evidence and the arbitrator has the same degree of discretion as the Queen of Hearts. Be assured the process is one aimed at fairness and efficiency. The practitioner who understands these goals and assists the arbitrator in meeting them will increase the chances of a successful result.
