New York recently adopted a new set of rules under the CPLR that allow the parties to business disputes to agree to streamlined, accelerated adjudication. The parties can agree to follow the new rules at the time the case reaches the court or by including a pre-dispute clause in the underlying contract that states, substantially, “Subject to the requirements for a case to be heard in the Commercial Division, the parties agree to submit to the exclusive jurisdiction of the Commercial Division, New York State Supreme Court, and to the application of the Court’s accelerated procedures, in connection with any dispute, claim or controversy arising out of or relating to this agreement.”

What does this mean? In the interest of time and efficiency, the parties agree to engage in focused discovery and waive certain procedural rights that one party might otherwise use for dilatory purposes:

– All pre-trial motions, mandatory mediation sessions, and discovery must be completed and ready for trial within a 9-month period from the date that a Request of Judicial Intervention is filed.

– Without showing good cause, each side is limited to seven discovery depositions, each of which must be no more than seven hours in length.

– Any documents that are requested must be relevant to the claim or defense and will be subject to a restricted time frame.

– Responses to e-discovery requests must be provided in an easily searchable format; only those individuals whose electronic document collection is expected to contain evidence related directly to the dispute can be subject to e-discovery; the court retains the opportunity to deny requests for e-discovery when it appears that the burdens or costs are disproportionate in relation to the case at hand; and the court can also order that the requesting party to advance the reasonable production costs to the other side.

– The parties waive their right to trial by jury, the right to interlocutory appeal, any objections regarding lack of personal jurisdiction and any right to discovery outside of the above-mentioned rules.

In other words, in order to compete with the growing popularity of arbitration as a means for resolving commercial disputes, the parties agree to streamline the pre-trial process to resemble the ideal process that arbitrators discuss among themselves.

Whether a streamlined process happens in arbitration or not is up to the arbitrator. Can he help control the appetite of parties and their litigators for unlimited discovery? Can he help the parties weigh the costs and benefits of extensive and expensive electronic discovery requests? Can he curtail any strategic impulse on the part of the lawyers who hired him to stretch out the process with motion practice? Since the parties have ultimate control over the arbitration process, arbitrators are more or less successful in making the process look less like litigation with a private judge and more like what it is promised to be. In contrast, under the “rocket docket” rules, the scheduling of hearings and decisions is still with the Supreme Court (despite the name, New York’s trial court of general jurisdiction), but once the parties commit the court should enforce the pre-trial timeline.

The decision of the parties between arbitration and accelerated adjudication thus turns on (I) the ease of scheduling arbitration as compared to the court, (ii) whether the parties want to hold down process time and costs while allowing full and fair discovery, and their decision on whether an arbitrator or court would more likely do so and (iii) whether choosing a trier of fact with a special skill set is important.

In any event, lawyers advising parties to commercial contracts governed by New York law should discuss with their clients whether to include a Rule 9 pre-dispute choice of forum clause.