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Delaware Chancery Court Adopts Voluntary Arbitration Rules for Business Disputes
Practical Law Legal Update 9-501-2531 (Approx. 4 pages)
Delaware Chancery Court Adopts Voluntary Arbitration Rules for Business Disputes
by PLC Corporate & Securities and PLC Finance
| Published on 19 Jan 2010 • Delaware |
An update on the Delaware Court of Chancery's new voluntary arbitration rules for certain business disputes.
On January 5, 2010, the Delaware Court of Chancery issued an order adopting new voluntary arbitration rules for business disputes involving a claim solely for monetary damages. The rules were adopted under a law that amended the Delaware Code relating to dispute resolution in the Delaware Court of Chancery (see Legal Update, Delaware Amends Dispute Resolution Code for Court of Chancery). The new arbitration procedures are effective February 1, 2010 and are intended to provide an option for litigants seeking expedited proceedings for qualifying cases. Highlights of the new arbitration procedures include:
- The amount in controversy must exceed $1 million.
- The arbitrator will be a permanent sitting member of the court and the arbitration proceedings will be confidential.
- A preliminary conference will occur within 10 days of commencement of the arbitration, unless the parties and arbitrator agree otherwise.
- The arbitrator will set the date, time and place of the hearing, which will generally occur no later than 90 days after receiving the petition.
- Appeals will be made directly to the Delaware Supreme Court.
The court also issued a standing order listing the fees associated with the new rules, which include:
- A petition filing fee of $12,000, shared by the parties.
- A fee for each day or partial day after the first day that the arbitrator is engaged in arbitration of $6,000, shared by the parties.
When drafting dispute-resolution procedures in agreements, counsel should keep this new arbitration procedure in mind as an available option.