Philadelphia Compulsory Arbitration: A View From Behind the Desk

The Philadelphia Compulsory Arbitration program is a great way to resolve smaller litigation matters if the parties take it seriously. In my opinion, taking the arbitration seriously can be a good way to move a case along towards settlement. The lawyers get to see how their clients testify under pressure. Maybe the insurance adjuster will realize the case has some merit, or maybe the plaintiff’s attorney will realize the witness will not come off very well at trial. Compulsory arbitration is a great and inexpensive way to figure it out.

Compulsory arbitration is also a good place for young lawyers to either serve on a panel or get some trial experience without serious risk of harm to a client.

I’ve had the pleasure of both litigating cases at the arbitration center, and as of late, sitting on several arbitration panels. Sitting on panels has been one of my most meaningful litigation experiences – just seeing what works, what doesn’t, and what the panel is looking for.

Below are some tips and observations.

First off, what is compulsory arbitration?

All civil actions filed in the Court of Common Pleas of Philadelphia County with an amount in  controversy of $50,000 or less, excluding equitable actions and claims to real estate, must first proceed to a compulsory arbitration hearing before a panel of three attorneys who have been   court certified to serve as arbitrators.

In plain language, this means a smaller case will be tried before three lawyers instead of a judge or jury. It won’t be heard in a courtroom, but instead in a conference room with three lawyers sitting behind a desk. While the Rules of Evidence are still applicable, they are relaxed.

The panel will usually be made up of a lawyer designated as “defense”, “plaintiff”, and “neutral” based on their background. An experienced attorney will be designated as the lead chairperson, and they will ultimately decide things like evidentiary rulings.

The big difference is in arbitrations is this: Pa.R.C.P. 1305 allows parties to submit medical records, expert reports, and other documents instead of live testimony. Otherwise, small claims would be cost prohibitive to try because of paying doctors and expert witnesses for their time. Imagine having to pay a doctor or expert witness thousands of dollars to testify in court when the amount in controversy isn’t that much. You don’t have to drag doctors or experts into arbitration – the panel will simply review their reports.

Compulsory arbitration also has self-executing discovery rules, which also help to keep costs down.

Finally, if you don’t like the result of a compulsory arbitration, it can be appealed as of right de novo by either party in most circumstances. This means either party can request a full blown trial before a judge or jury.

Ten Pointers from the View From Behind the Desk

In my experience, the best litigants make it easy for the panel to identify important documents, they focus on the important stuff, and avoid belaboring the ancillary stuff. They also have copies of what the panel thinks is important. Less effective litigants belabor ancillary points, their papers are hard to identify, and they don’t draw out testimony on issues that the panel thinks are important. When a good litigator handles an arbitration, the panel rarely says “I wish there was more testimony about ABC” or “I wish we had that medical report” or “A copy of that statute would sure be helpful.”

Think about it like this when preparing your outline: if you were sitting on a panel, what would you be looking for when determining liability and damages?

Young lawyers, here are some practical tips if you’re arbitrating your first case in Philadelphia, because lists are awful…

1.  Being prepared and organized is paramount. Everything else flows from this, really. Consider making an arbitration packet with a table of contents summarizing the evidence you intend to submit. You’re trying to make it as easy as possible for the panel to follow what you’re talking about, and to find the documents they think are important quickly. If your documents are hard to identify, the panel will spend a lot of time looking for papers, and it could detract from the point you’re trying to make. If they’re shuffling papers, they’re not listening. Make sure to bring 5 copies (or more if there are additional parties).

2. Consider bringing 5 copies (or more) of case law, relevant statutes, and the pleadings. (One copy of each panel member, one for yourself, and one for opposing counsel.) If there are multiple defendants, bring more. In addition to the evidence you intend to submit, I’d suggest bringing the following at a minimum:

  • Complaint
  • Answer / New Matter / Counterclaim
  • Any other pleadings (Joinders, etc.)
  • Any statutes you intend to argue
  • Case law and a memo if you are arguing something as a matter of law
  • Copies of any portions of a deposition transcript you’re using, interrogatory answers you intend to impeach with, etc. If you’re going to impeach a witness, it helps if the panel can evaluate their testimony while reading whatever it is you say contradicts it
  • DVDs, videos, or anything else. These can be used at arbitration. And don’t rely on the computers at the arbitration center – consider bringing your own laptop or a DVD viewer if you intend to use video evidence. (obviously, you don’t need 5 copies of media). One good copy of relevant pictures will usually also suffice.
Keep this in mind – if you don’t have it with you, how can the panel consider it? Statutes or case law is especially important, because the panel may not be familiar with law you believe applies. Hence, if you want the panel to consider it, bring it with you. If you want to argue the law, put the law before the panel. If you want to argue a doctor’s report, make sure the panel has it. If you want to call the witness a filthy liar because of testimony that contradicts something said in a deposition, bring copies of that portion of the deposition.

3. Prepare an outline with this in mind: “What would I be looking for if I were sitting on the panel?”. Thus, know your proofs and how to elicit testimony establish them. For example, if part of the claim involves loss of life’s pleasures, make sure you elicit testimony to that effect. How did this injury affect your client’s life? Could they no longer play the violin? Work out in the gym? If your claim involves breach of a contract, did you elicit testimony that your client was entitled to payment, did the work, and was not paid? Did your client perform the work reflected in the invoices? It’s important to bring these issues out, because the panel will most likely be focused on the evidence that was presented to establish proof of the allegations. Make sure it’s there.

I’ve sat on a few panels where it went down like this: “They put on a lot of testimony and submitted a lot of evidence about what the weather was like that day. I almost told them to cut it off – they made their point. It’s pretty clear it was rainy that day. However, there wasn’t any testimony about how the injury actually affected the plaintiff’s life. I mean, how can we find any damages for pain and suffering? I wish we had a little bit more on that, because the defendant is obviously in the wrong here, but the award is going to have to be small. If they gave us more to work with, we might find for a bigger award, but they didn’t.”

4. Know your audience – it’s three lawyers, not a jury. For instance, in my opinion, impeaching the credibility of an unsophisticated witness is kind of “meh” unless you have something to suggest fraud or deceit. Now, if you have something that paints a litigant as a liar, it can be a great way to diminish the credibility of everything else they say. However, if you find deposition testimony where a witness said they eat Cheerios everyday, but then on cross-examination find they had eggs for breakfast this morning, in my opinion it does you more harm than good. Your case is being determined by a panel of lawyers who are familiar with the system. Chances are, if the witness is unsophisticated, they are nervous, this might be their first time in court, and they may make mistakes when it comes to trivial details. This makes them a human being, not a liar, especially to a group of lawyers. It makes you look more like a bully.

5. Consider preparing a concise statement of facts and any legal issues. The panel does not read your memorandum before the arbitration. However, in my experience, they will certainly consider your memorandum when deliberating. A good, concise memorandum will reinforce the points you are trying to make. If the statement is too long, however, it becomes difficult for the panel to find the information they are looking for. Remember, you’re not trying to win on summary judgment at an arbitration – just to make your point understandable to the panel.

6. Read the state rules and local Philadelphia Rules on arbitration. For instance, Phila. Civ. R. *1305 (often called the “20 Day Rule”) states that:

(1) General Rule. In addition to the evidence permitted by Pa.R.C.P. 1305(b), expert witness reports, description of expert qualifications, attorney’s certifications as to time and hourly rates in claims where counsel fees are involved, bills, and records of business which ordinarily would be admissible if authenticated by a custodian of records shall be received in evidence without further proof provided that at least 20 days’ written notice of the intention to offer such documents in evidence was given to any adverse party accompanied by a copy of the item to be introduced. Provided, however, that if the documents were previously produed, they need only to be identified within the above time period.

It would be kind of a bummer if you didn’t send out a 20 Day Notice, the other side objected on authentication grounds, and you didn’t have a witness with you to authenticate the documents.

7. Don’t belabor obvious points for too long –instead, focus on important stuff. For instance, if you need to prove that a person’s hair was red on the day of an incident, a photograph or two, along with testimony, will probably suffice. You probably don’t need 20 photographs, testimony from three independent witnesses, and a forensic expert. (unless the issue is heavily disputed). While that might be important at a jury or bench trial due to the record, or it might have been a big issue on summary judgment, for the purpose of arbitration you’re just trying to make the point. This is especially important if you spend too much time belaboring a non-issue, it will often detract from the more important issues, like damages and liability. The case is being determined by experienced lawyers. In my opinion, litigants tend to underplay damages, particularly when it concerns pain, suffering, and loss of life’s pleasures. In a personal case, the panel probably wants to know how the accident happened, what the defendant did wrong, what type of treatment the plaintiff received, and how the injury affected the plaintiff’s life personally. Focus on that stuff.

8. Arbitrations can be transcribed. If you think a witness will give good testimony, consider hiring a court reporter. Granted, a panel will probably  not allow you to use an arbitration as a second deposition. However, it might be worth transcribing the testimony, especially if you feel the case won’t resolve. You don’t have to transcribe the entire arbitration either – just the witnesses you want.

9. Get feedback. If you think a result was out of wack, or you want feedback on your case, you can call the arbitrators the next day. There is no prohibition from contacting the arbitrators after they’ve entered an award. Give them a call and get their impressions of the case once the arbitration has finished. Chances are, they’ll enjoy talking about the case with you. If you’re a young lawyer, you’ll usually get some good feedback and make some contacts.

10. Chill, son. If you’re worried, you can relax if you did all the stuff above. Chances are, if you’re prepared, you’re not the worst thing the panel has seen – even if you’re green. Plus, if the result is terrible for your client, it can be appealed de novo to the trial court in most circumstances. Just make sure you calendar the appeal deadlines and you’re familiar with the local rules.

How Do I Become An Arbitrator in Philadelphia?

You take the Philadelphia Compulsory Arbitration CLE course if you meet the requirements. Do a search for “arbitration” on PBI’s website. Phila. Civ. R. *1301(b) outlines the minimum criteria.

You currently get paid $225.00 to sit a full day. However, if you’re a young lawyer, the experience is more important than the check.

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