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Can’t Agree?

Agree to arbitrate to fairly and quickly resolve disputes
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Arbitration: DRC
No organization in the produce industry conducts more arbitrations than the DRC, based in Ottawa, Ontario. The DRC, in a sense, functions similarly to PACA in the United States, helping keep produce firms out of the courts by requiring members to arbitrate disputes that cannot be resolved through its informal mediation process.

By the terms of their DRC membership agreement, members agree that disputes with other DRC members will be resolved through the DRC (with PACA an option for eligible claims). Fred Webber, president of the DRC, explains that its arbitration process, particularly when selling into Canada, has become a service the industry relies on. “Not long ago, there were only limited options to resolve Canadian disputes involving slow pay, no pay, and commercial contracts.”

The DRC’s arbitration process is quite sophisticated and includes arbitrator selection, oral hearings, and different procedural rules depending on the amount in dispute. “From the beginning our members were clear that they wanted a process that met the needs of the produce industry,” explains Webber. “The process is now time-tested and has survived challenges in the courts.”

The typical arbitration conducted by the DRC is rather straightforward. “It is a documentary procedure, with no oral hearing and two rounds of document exchange. The chosen arbitrator issues his or her decision based on the written submissions,” says Webber. “Larger, more complex cases do have hearings, however. And for all arbitrations, the DRC staff is involved in administering the logistics of the case.”

Arbitration: Blue Book Services
Blue Book arbitration has a long history dating back to at least the 1950s. The process has historically been used by those members with an honorary Trading or Transportation Membership designation. But today Blue Book arbitration is typically invoked voluntarily between the parties almost as a form of “settlement agreement” where the parties agree to disagree, and then let the arbitration process determine the resolution.

“Years ago, we ran an ad that read ‘Can’t agree? Agree to Arbitrate,’ and I think that sums up the value of the arbitration we offer pretty well,” comments Jim Carr, president of Blue Book Services. “If the parties can agree on the process to resolve the dispute—even if they can’t agree on exactly how it should be resolved—that goes a long way toward preserving the business relationship, which is usually worth a lot more than winning the arbitration in the long term.”

Blue Book’s arbitration process does not provide for oral hearings or a selection process for arbitrators. The process is as streamlined as possible and uses a panel of three arbitrators (consisting of Blue Book personnel).

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