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Chicago International Dispute Resolution Association
Undisputed Facts
Newsletter of The Chicago International Dispute Resolution Association - Winter 2002
Negotiating and Drafting the Dispute Resolution Clause in Major
Agreements
Appendix A
1.0 Dispute Resolution
The parties shall attempt in good faith to resolve any dispute, whether based on contract, tort, statute, fraud, misrepresentation or any other legal or equitable theory, arising out of or relating to this Agreement (and any other prior agreement or understanding that this Agreement supercedes), including without limitation, its making, termination, non-renewal, its alleged breach and the subject matter of this Agreement (e.g. products or services furnished hereunder) as follows:
1.1 Negotiation
By negotiation between executives who have authority to settle, but were not previously intimately involved in, the controversy. The aggrieved party shall initiate negotiations by giving the other party written notice. Within twenty (20) days after delivery of the notice, executives of both parties shall meet at a mutually acceptable time and place, and thereafter as often as they reasonably deem necessary, to exchange relevant information and to attempt to resolve the dispute. If the matter has not been resolved within forty-five (45) days of the aggrieved party's notice, or if the parties fail to meet within twenty (20) days, either party may initiate mediation as provided below.
If a negotiator intends to be accompanied at a meeting by an attorney, the other negotiator shall be given reasonable notice.
1.2 Mediation
If the dispute has not been resolved by negotiation, the parties shall attempt to resolve the dispute by mediation. The parties have selected ___________ as mediator. In the event he or she is unable or unwilling to serve, the parties have selected ___________ as the alternate mediator. In the event that neither is willing or able to serve, the parties, assuming they cannot agree, will seek the assistance of [name of mediation/ arbitration institution]. Any mediation shall be conducted in accordance with the then current [name of institution] mediation rules. Each party to the mediation shall bear its own expenses with respect to the mediation and the parties shall share equally the fees and expenses of the mediator. The failure of a party to timely pay its share of the mediation fees and expenses shall be a bar to arbitration under Section 1.3 of that party's disputes. Mediation shall be conducted within Chicago, Illinois at a site selected by the mediator that is reasonably convenient to the parties. Each party shall be represented in the mediation by representatives having final settlement authority with respect to the dispute.
1.3 Arbitration
If the dispute has not been resolved by negotiation or mediation within 90 days of the aggrieved party's notice of dispute, it shall be finally resolved by arbitration conducted in accordance with the [Arbitration Rules of the Chicago International Dispute Resolution Association][other arbitration institution rules]. Unless otherwise agreed by the parties, there shall be three arbitrators. The arbitrators shall have the sole authority to resolve any and all issues as to the arbitrability of any disputes, including the applicability or running of any statute of limitation and all questions including issue preclusion. The arbitrators may conduct some or all of the proceedings by telephone and shall use best efforts to take advantage of available technology. The arbitrators' decision and award shall be delivered to the parties withing six months of selection of the arbitrators and judgment on the award shall be entered by any court having jurisdiction. The arbitrators shall not multiply actual damages or award punitive damages. Each party shall be responsible for its own legal fees.
The place of arbitration shall be Chicago, Illinois.
The arbitration procedure shall be governed by the [United States Arbitration Act, 9 U.S.C. Sections 1-16], [the Illinois International Commercial Arbitration Act, 710 ILCS 30/1-1] The law governing all substantive matters shall be the law of the State of Illinois without regard to its conflicts of laws rules [or laws relating to arbitration of disputes -- if choosing FAA].
The language of the arbitration shall be English.
1.4 Confidentiality
All information and documents disclosed in negotiation, mediation or arbitration by any party shall remain private and confidential to the disclosing party and may not be disclosed by any other party. All information and documents disclosed in negotiation or mediation by any party shall be treated as compromise and settlement negotiations for purposes of the United States Federal Rules of Evidence or any state rules of evidence.
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Peter V. Baugher,
President
One South Wacker Drive, Suite 2800, Chicago, IL 60606 USA
312-409-1373 (Telephone), 312-701-9335 (Facsimile),