Legal A. A. A.

There is no way of knowing what litigation costs U. S. citizens each year. Civil court machinery in the city of New York alone costs Federal, State and city governments more than $17,000,000 per year. Only since the War has there been serious attention paid to that field of law which aims to avoid litigation, namely, arbitration. Prime U. S. force seeking to eliminate needless litigation is the American Arbitration Association, which this month is starting its twelfth year of activity.

To mark the event, the A. A. A. last week sent to its 600 members and 7,000 arbitrators in 1,600 U. S. cities the first issue of The Arbitration Journal, a quarterly devoted to solidifying and expanding the out-of-court sphere of law. Honorary editor of the Journal is famed onetime (1921-28) World Court Justice John Bassett Moore. Active editorial direction is in the hands of the A. A. A.'s perennial president, Lucius Root Eastman, 62, president of The Hills Brothers Co., big Manhattan importers and manufacturers (Dromedary Dates, grapefruit juice, pimentos), and a board including Educator Isaiah Bowman and President Thomas J. Watson of International Business Machines Corp.

Contents of the 114-page issue include a survey of world-wide arbitration efforts, symposiums on "Arbitration in Insurance" and "Should Arbitrators Be Paid?", an article on the national scope of the A. A. A. by President Floyd Bostwick Odium of Atlas Corp.

Arbitration is simple, cheap, private and voluntary. Because it is simple, people are suspicious of it. Because it is cheap ($5 for a $500 claim, $200 for a $99,000 claim), some lawyers think it robs them. Since it is private, wide publicity has not favored it. Because it is voluntary, it is hard to get started, but once agreed to, arbitration can be final: its decisions are legally enforceable in 13 States.* First modern arbitration law in the U. S. was passed by New York in 1920, although the methods date to Colonial times.

Most success for the A. A. A. has come within business and professional groups which have established arbitration principles in contracts. Examples: the fur industry, actors and architects. Stock exchange firms have popularized an arbitration clause in customers' agreements, paving the way for settlement of such controversies as the one in 1935 involving $500,000 worth of Alleghany Corp. preferred stock (TIME, Oct. 28, 1935).

Within the past two years the A. A. A. has organized facilities to handle as many cases involving injured persons and accident claims as could be taken out of crowded city courts. In New York City co-operation of the bar associations and the presiding justices of the city and municipal courts was readily obtainable. From these courts cases which would take as long as three years to bring to trial have been settled by arbitration within a few days after submission to the A. A. A. So far, 43 insurance companies have submitted 3,915 casualty cases, nearly half of which were arbitrated. In 1,497 cases, however, lawyers for the plaintiff have refused to arbitrate.

*Arizona, California, Connecticut, Louisiana, Massachusetts, New Hampshire, New Jersey, New York, Ohio, Oregon, Pennsylvania, Rhode Island, Wisconsin.

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