A Data-Driven Exploration of Arbitration as a Settlement Tool: What Happens When Cases Do Not Settle Before a Hearing?

In this continuing series of blog posts, we have been using Dispute Resolution Data (DRD)’s growing repository of international arbitration case data to analyze the extent to which such cases reach various outcomes, whether it be an award being rendered, administrative closure, dismissal, impasse, or settlement/withdrawal (which we treat as a single, distinct outcome). Our first blog post demonstrated that when looking at an aggregate of DRD’s international commercial arbitration case data (which, as of November 2018, includes approximately 4,000 arbitration and mediation cases, dating back to 2005), the most frequently observed outcome is settlement/withdrawal, which is often reached within a year of the claim date and also prior to any counter-claim, preliminary hearing, or hearing on the merits. Our follow-up blog posts demonstrated that the margin of error (MOE) associated with such results is largely dependent on the size of the sample used to estimate the proportion of the “population” of all such cases known to have occurred. We also introduced our proprietary “Signal Strength” metric, a quick visual indicator of the degree of confidence that the statistical estimate based on DRD’s data sample is closely representative of all cases meeting the same criteria; put simply, the greater of the number of cases used as a data sample, the smaller the MOE (and correspondingly, the higher the “Signal Strength”).

 

Here, we examine how the spectrum of case outcomes potentially shifts when the case does not settle quickly and instead proceeds to a hearing on the merits. Based on the current sample of 3,642 international commercial arbitration cases in DRD’s database, we estimate that approximately 13% of such cases proceed to a hearing. Because of the relatively large size of the data sample, this estimate has a low margin of error (±1%) and a high “Signal Strength” (5 out of 5), as depicted in Figure 1:

The post A Data-Driven Exploration of Arbitration as a Settlement Tool: What Happens When Cases Do Not Settle Before a Hearing? appeared first on ADR Toolbox.

This post, A Data-Driven Exploration of Arbitration as a Settlement Tool: What Happens When Cases Do Not Settle Before a Hearing?,  by Brian Canada, Kluwer Arbitration Blog first appeared on  at http://www.adrtoolbox.com/.

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