Frequently
Asked
Questions

What is meant by binding arbitration? Is net-ARB's arbitration binding?

Used in a legal sense, something that is "binding" imposes an obligation. A binding contract is one where both sides are committed to doing what the contract requires of them. In binding arbitration, both sides must do what the arbitrator (the neutral third party assigned by net-ARB) decides they should do. Our »Arbitration Agreement which both sides sign upon registering is itself a binding contract wherein both sides agree the arbitrator's decision will be binding on them.

All net-ARB decisions are binding unless otherwise mutually agreed by the parties prior to the hearing.

What is mandatory arbitration? What happens when one party refuses to participate in mandatory arbitration?

An arbitration is mandatory when a written agreement specifies that all disputes (or certain specified disputes) must be resolved by arbitration. If one party refuses mandatory arbitration, one of two things may occur. If the written agreement specifies that the failure of either party to arbitrate constitues a default, then net-ARB can issue a default award in favor of the consenting party. If the written agreement fails to include a default clause, an ex parte hearing will apply. Both default awards and ex parte hearing are described immediately below.

What is a default award?

When a written agreement includes a mandatory arbitration clause (see above, What is mandatory arbitration?) and also includes a provision that in the event either party refuses to arbitrate the consenting party is entitled to win by default, net-ARB may issue a default award in favor of the consenting party that is binding on both parties.

What is an ex parte hearing?

When a written agreement includes a mandatory arbitration clause (see above, What is mandatory arbitration?) but no provision for a default award (see above, What is a default award?) and either party refuses to arbitrate, the consenting party may request an ex parte hearing in which only the consenting party is heard. The consenting party must show that it is entitled to the relief (damages) being sought. Any award issued is binding on both parties and enforceable just like an ordinary arbitration award. Fees for holding an ex parte hearing are explained in the »Arbitration Option and Fee Schedule.

Who are net-ARB's arbitrators?

net-ARB offers a diverse selection of arbitrators for our clients, some of whom are attorneys, while others are subject matter experts. There is no legal requirement that an arbitrator be an attorney. Our non-attorneys are selected based upon their expertise in a particular field or profession ranging from web technology, software architecture and programming, human resources, construction, home maintenance, and even dentistry. Having a subject matter expert hear your case is a significant advantage of arbitration over the court system.

All net-ARB arbitrators must complete an internship program prior to independently conducting an arbitration, which includes successfully demonstrating competencies in basic contract law and other basic legal principles as well as arbitration techniques and procedures.

Who chooses the arbitrator for my hearing?

net-ARB chooses your arbitrator. This decision is based upon the nuances of your individual case. This is a tremendous advantage over the traditional court system where you are assigned a judge who in all probability has done nothing but legal work their entire professional life, and has no first-hand business experience and no experience with the goods or services being disputed.

Some arbitration firms will offer the parties a choice from among a short list of arbitrators. Each party selects 2 or 3 arbitrators from the list in order of preference and the arbitration firm compares both lists to see if there is a mutual choice. If not, the arbitration firm selects the arbitrator. There are a few reasons we do not provide this method for selecting arbitrators:

1. Parties often do not have enough specific information about the arbitrators from the general bios they are given to make the best choice for their particular situation. Knowing our arbitrators as well as we do, we are in a much better position to make the best match available;


2. These selection systems often result in neither party getting their first choice and just as often not their second choice either. Will you be happy if you get your 3rd choice? Will you be happy if there's no agreement on choices and you end up with someone not on your list? The selection process often ends up being a disappointing waste of time; and


3. Having this selection feature will add cost which we have to pass on to you in the form of higher fees. net-ARB was founded on the principle of keeping fees as low as possible to make arbitration an affordable alternative to litigation for as many people as possible.

Why do some of net-ARB's arbitrators and staff only use their first name?

Stories of people behaving badly on the internet are pretty widely known. If you haven't experienced a rude interaction with someone yet, you are one of the fortunate few. Psychologists say it has to do with it not being a normal human interaction - you cannot see or hear the other person so you form no human bond with that person. It leaves you wondering what someone might be capable of if they were angry enough.

The arbitration business is like no other business in the world because you know going into it that half of your customers are not going to be happy when they leave. True to form, we hear from many losing parties and some of them are the type we just described – some are worse and some are even threatening

You can see where this is going. To ensure we do not compromise the safety and well-being or our staff and their families, we caution our arbitrators against revealing their identity and to use first names only. Parties are always addressed by their last name preceded by Mr. or Ms.

What Laws & Rules do net-ARB arbitrators follow to decide cases?

Laws vary from one country to another, from one state to another, and even between counties and towns within the same state or country. Every time a dispute crosses one of those boundaries (called "jurisdictions" in legal language), the issue of which laws to use becomes a problem and often times it becomes a trial within a trial. Even when the contract specifies the "choice of law", clever lawyers find a way to make it an issue either to create extra burden for the other party or so that local laws, more favorable to their client, can provide the technicality they need to win.

Choice of law also presents an obstacle for arbitration service providers. In order to receive referrals from local court systems, they must provide arbitrators with knowledge of local laws. What that means is that the arbitration service must remain small and localized, or in the case of the larger brick and mortar abritation firms, they need to employ hundreds of lawyers across every city they wish to serve, thereby driving up the cost of arbitration to a point where it exceeds the financial reach of most individuals and small businesses. In order to serve the whole world, the cost would be extremely large.

One reason net-ARB was formed was to break those jurisdictional and economic barriers. net-ARB did that by adopting a universal set of rules or criteria for deciding cases.

Arbitrators at net-ARB decide cases based on what they believe is fair. After all, isn't that what lawmakers attempt to do when they write laws? That does not mean that applicable laws are ignored. Law and regulations are taken into account whenever applicable.

net-ARB's Arbitrator Guidelines:

• Determine a fair and reasonable outcome based on the evidence presented and application of the following:
  • General principles of equity and common law
  • Common sense analysis of circumstances and context
  • Personal experience & expertise
  • Applicable laws and regulations presented by the parties


• Arbitrators must immediately request re-assignment for any of the following reasons:
  • Conflicts of interest, no matter how slight
  • Presence of bias, no matter how slight
  • Loss of neutrality at any stage of the hearing

net-ARB's primary guidance to its arbitrators is "do equity." Equity courts have been around for literally thousands of years (arbitration dates back over 5000 years!) and have the power to "do equity" even when a legal technicality might require the opposite result. A recent unanimous decision from the California Supreme Court re-affirmed an arbitrator's power to do equity in exactly that kind of situation. Click »here to read more about this historic case.

net-ARB arbitrators apply what is known as "common law", a set of principles handed down over centuries that have served as the basis of statutory law. For example, in order to have a valid contract, there must be a benefit ("consideration") to both parties. The price must be stated, etc.

net-ARB arbitrators also apply their own common sense and life experience to a given situation, which is why net-ARB uses mature arbitrators and assigns arbitrators with a particular expertise in cases where that expertise is needed in order to fully comprehend the facts. Ultimately, the goal of every net-ARB arbitrator is to determine a fair and equitable solution that fits the facts of your case, rather than some contrived decision that rests on some technicality of a particular local statute.

net-ARB's adoption of these principles makes it the only truly worldwide arbitration service provider.

Is net-ARB a registered arbitration firm?

From time to time we are asked why we are not affiliated with some arbitration organization like the American Arbitration Association. The fact is there is no sanctioning body or licensing organization for arbitration administration firms. The American Arbitration Association is simply another arbitration firm. The "American" in their name has no legal significance - they are not a governmental organization nor are they affiliated with one. Calling themselves an Association is merely a matter of preference - it has more of a ring to it than American Arbitration Company or American Arbitration Organization - nor are they an "association" of arbitration firms. Any organizations that do exist are merely fraternal in nature, focused primarily on collective advertising. Some jurisdictions do license or register arbitrators. For example, the state of Georgia registers arbitrators. Henry Abelman, net-ARB's President, is registered with the Georgia Office of Dispute Resolution as both an arbitrator and a mediator.

Why can't I find net-ARB's phone number on its website?

We do not take phone calls because we keep a written record of all of our communications with parties or potential parties. Ethical reasons include maintaining neutrality, avoiding any appearance of bias, and certainty about any information or answers we provide. We want to avoid a situation where a losing party can later try to overturn the decision claiming we gave them bad information. If you are the winning party, you don't want to be caught up in a post-decision controversy.

Why isn't net-ARB's physical address listed on its website?

Some people think if we don't list a physical address then we don't really exist - we're phony. The fact is we don't have a physical office. Everyone here works remotely as they have from day one - that's the way we designed it. And that's one of the reasons we can offer the same quality arbitration as the big name brick & mortar arbitration firms at a fraction of the cost.

net-ARB Inc. was incorporated in the State of Georgia (USA) in 2004 by Marty Lavine, its founder, an Atlanta area resident, and net-ARB is in good standing with the state of Georgia. Our hearings are conducted entirely by email and we do not accept physical evidence or any non-email communication from clients. We have no need for postal service and do not entertain visitors. We could rent an hardly used office and use that address, but that would not be honest.

I find scam reports on the internet saying all kinds of bad things about net-ARB. Should I be worried?

No, in fact you should be worried if you couldn't find negative reports about us! All you have to do is understand that all of our clients expect to win, but half of them will be disappointed. It's only natural that some would take to the internet to say bad things about us. If a business like ours doesn't suffer occasional bad reviews from losing parties, they must be paying someone off.

Where are your arbitration awards recognized?

Under a United Nations Treaty concerning enforcement foreign arbitration awards, arbitration awards are recognized in 166 countries and the list keeps growing every year. Click »here for a list of the countries who are parties to this Treaty. In the United States of America, all state and federal courts have recognized arbitration awards

Since net-ARB is based in the U.S., do you favor U.S. residents?

Of course not. Think about it a minute. If we showed any favoritism how long would we be in business? If you've been around our site maybe you have already run across our »Complaints section where we feature some not-so-nice things losing parties have said about us on the internet. They accuse of many things but no one has ever accused us of bias based on nationality, race, or religion. Our registration process doesn't even ask for your physical address, only your email address.

Can we use net-ARB if our contract says we have to use the American Arbitration Association (AAA) or some other firm? How about if our contract says we have to use a different set of rules?

Yes to both questions. If both parties agree to use net-ARB and net-ARB rules instead of the American Arbitration Association or any other provision of their contract, they are always free to amend their contractual choice. If both partys sign our arbitration agreement, this will amend their original contractual choice and also acts as an automatic waiver of the contract provision.

What are the parameters for disputes arising on Escrow.com?

The Escrow.com’s user agreement specifies that disputes must be settled by arbitration (see above, What is mandatory arbitration"?) and that a default award (see above, What is a default award?) may be issued in the event either party refuses to arbitrate.

I am in a dispute with someone and we agreed to use your arbitration service. Which one of us should file the case?

In many judicial settings a lot is based upon which party filed the lawsuit. The order in which both parties present their case is based upon the filing order as well as the all-important "burden of proof". An important thing to know about the burden of proof is in the event of a tie, the party with the burden of proof loses. Most times that is going to be the party that filed the case. With net-ARB, the burden of proof is determined logically from the facts, not by who filed first. In a net-ARB arbitration it does not matter who files the case, both parties are given an equal opportunity to be heard and present their case.

Can I appeal if I disagree with the decision?

One of the advantages of arbitration is the fact decisions are extemely difficult to appeal. Everyone has heard of lawsuits that stay in the courts for years – these are due mainly to appeals. Party A wins so party B appeals. If party B wins the appeal, party A appeals the appeal, and on and on. Arbitration offers disputing parties immediate closure and a certain future rather than years of legal wrangling. Courts will not hear arbitration appeal cases, except in unusal and specialized circustances. When you win your case in arbitration, it is usually over! An arbitration award may still have to be enforced, and we have answered some frequent questions on this topic »here.