It has become very common for contracts to require Forced Arbitration. The average citizen enters into agreements frequently, and there is almost assuredly a requirement for Forced Arbitration. There is concern that the system is inherently biased toward the party that will be responsible for repeat business.

The New York Times has done extensive investigation of arbitration.

“Over the last 10 years, thousands of businesses across the country – from big corporations to storefront shops – have used arbitration to create an alternate system of justice. There, rules tend to favor businesses, and judges and juries have been replaced by arbitrators who commonly consider the companies their clients, The Times found.” (Jessica Silver-Greenberg and Michael Corkery, New York Time, November 1, 2015)

Examples of agreements that are very likely to have a clause requiring Forced Arbitration: Construction defects, Nursing Homes, Assisted Living homes, Elder abuse, Medical malpractice, Wrongful death, Discrimination, Employment Agreements, most of what is agreed to on the internet, Smart Phones, Credit Cards, Most of Services provided by Banks. Basically, almost any agreement a person would normally agree to, and that is almost never read or understood by the person signing the document.

In essence, resolution of many, if not most, civil disputes have been privatized. These can be small disputes such as contracts for cell phone usage, or millions of dollars for serious construction defects or improper care at a nursing home.

The Colorado Legislature in 2018 considered two bills, designed to improve fairness of privatized conflict resolution. The bills (HB18-1261 and HB18-1262) were passed in the Colorado House of Representatives and then assigned for considered by a Senate committee. The intent of these bills was improvement in the privatization of justice. Both bills were defeated by the Senate committee by a party line 3 to 2 vote.

There were two main issues considered by the committee.

First: just how significant is the problem? The conclusion is there is just not enough evidence to justify the need for this legislation.
Somehow, rights set forth in the U.S.A. Constitution were not considered. The seventh amendment requires government to assure Justice for All in civil disputes resolved by legal means. This is reaffirmed every time we recite The Pledge of Allegiance. The last words are JUSTICE FOR ALL. It doesn’t say for the majority, or even for the 99 percent. It says FOR ALL. And yet a main point of the Senate committee was just how big this issue is, and how many lives are affected.

Unlike the court system, Forced Arbitration is “ONE AND DONE”. No appeal. No resolution of unfair treatment, except in very unusual circumstances. This practice of privatizing justice dictates a constitutional mandate to provide the very best protection for all parties.

It has been a fundamental foundation of the Rule of Law in the USA that “Justice Denied to One is Justice Denied to All”.

Second: The Senate committee concluded this legislation would require more interference by government of the private justice system of Forced Arbitration.

This is not a typical commercial enterprise. It is the Private Sector assuming the responsibility and duty of government to provide Justice for All. Careful regulation to protect this basic right is a fundamental obligation of government. Delegating justice to private enterprise is a process that requires detailed oversight. But the Senate committee considered it just another example of government interfering with the private sector.

In Conclusion: Residents of the State of Colorado are left with a system that is lacking protection that everyone deserves. There are many benefits to Forced Arbitration, but it is inescapable that improvement is needed, and that everyone deserves fair and impartial Justice for All. This is legislation that must be reintroduced in the next legislative session.

 

 

 

Ed Shackelford – REALTOR®
Real Living CO Properties – edshackelford.com
President: Colorado Senior Lobby
Email: President@coloradoseniorlobby.org
Phone: 303-832-4535