1 See American Arbitration Association, Archived Rules, <www.adr.org>.
2 See ibid (archiving Wills and Trusts Arbitration Rules effective respectively in September 2005 and June 2009).
3 American Arbitration Association, Wills and Trusts Arbitration Rules, effective 1 June 2012 (hereinafter AAA Wills and Trusts Arbitration Rules), <www.adr.org>.
5 ibid. Although not referenced in the Introduction to the AAA Wills and Trusts Arbitration Rules, informality is an additional feature typical of arbitration and, in fact, is a feature of arbitration under the AAA Wills and Trusts Arbitration Rules. See eg ibid Rule 31(a) (providing that ‘[c]onformity to legal rules of evidence shall not be necessary’ in the evidentiary hearing).
6 See ibid at Standard Arbitration Clause for Wills and Non-Commercial Trusts (citing as the motive for the testator/settlor’s arbitration clause a desire ‘to save the cost of court proceedings and promote the prompt and final resolution of any dispute’ within the scope of the arbitration clause); ibid at Standard Arbitration Clause for Commercial Trusts (citing as the motive for the settlor’s arbitration clause a desire ‘to preserve the assets of the trust’).
7 See also SI Strong, ‘Institutional Approaches to Trust Arbitration: Comparing the AAA, ACTEC, ICC, and DIS Trust Arbitration Regimes’ in SI Strong (ed), Arbitration of Trust Disputes: Issues in National and International Law (Oxford University Press 2016) paras 5.01–5.135. Professor SI Strong has noted that the AAA Wills and Trusts Arbitration Rules have not been widely effective in promoting wills and trusts arbitration at all. She observed in 2012, nine years after the AAA published the first version of its Wills and Trusts Arbitration Rules, that the Rules ‘are not very well known in either the trust industry or the arbitral community’ and ‘[i]ndeed, only a few references have ever been made to the AAA Trust Arbitration Rules in the legal literature, and then only in passing.’ SI Strong, ‘Mandatory Arbitration of Internal Trust Disputes—Improving Arbitrability and Enforceability through Proper Procedural Choices’ (2012) 28 Arbitration International 591, 595 n 18 (hereinafter Strong, Proper Procedural Choices). This remains true in 2015. A 4 June 2015 search for ‘Wills and Trusts Arbitration Rules’ in the Westlaw Law Review and Journals database produced eight law review articles that cite to the Rules. A similar search on the same date in the Westlaw Cases database (both state and federal) produced no cases that have cited the Rules.
8 See eg Bridget A Logstrom, ‘Arbitration in Estate and Trust Disputes: Friend or Foe?’ (2005) 30 ACTEC Law Journal 266, 267 (‘Arbitration hearings are not public record and, therefore, may help to keep private details of family disputes private.’).
9 See eg Frances H Foster, ‘Privacy and the Elusive Quest for Uniformity in the Law of Trusts’ (2006) 38 Arizona State Law Journal 713, 725–26 (discussing how the details of a trust that otherwise would have remained private might become public during trust litigation in the civil court system).
10 See eg David Horton, ‘The Federal Arbitration Act and Testamentary Instruments’ (2012) 90 North Carolina Law Review 1027, 1035–36 (explaining how litigation that might ‘expose a testator’s foibles and intimate life in open court’ would tend to generate an appreciation for the virtue of privacy in arbitration); Stephen Wills Murphy, ‘Enforceable Arbitration Clauses in Wills and Trusts: A Critique’ (2011) 26 Ohio State Journal on Dispute Resolution 627, 635–36 (‘Arbitration can shield both the trust and the personal affairs of the interested parties from the public eye.’).
11 See eg Lela P Love and Stewart E Sterk, ‘Leaving More Than Money: Mediation Clauses in Estate Planning Documents’ (2008) 65 Washington and Lee Law Review 539, 553 (‘A decedent who fears contest of her dispositions would undoubtedly prefer to avoid the spectacle of a trial in which her mental capacity, or her susceptibility to undue influence, is the central issue.’); John R Phillips, Scott K Martinsen, and Matthew L Dameron, ‘Analyzing the Potential for ADR in Estate Planning Instruments’ (2006) 24 Alternatives to the High Cost of Litigation 1, 10 (‘For some clients, the primary impetus for implementing the dispute resolution processes into trusts is confidentiality, often overriding concern about litigation costs.’).
12 AAA Wills and Trusts Arbitration Rules (n 3) Rule 22. See also ibid Rule 27 (providing in the context of a rule governing the attendance of expert witnesses at hearings that ‘[t]he arbitrator shall maintain the privacy of the hearings unless the law provides to the contrary.’).
13 ibid Rule 22. See also ibid Rule 27 (providing in the context of a rule governing the attendance of expert witnesses at hearings that ‘[i]t shall be discretionary with the arbitrator to determine the propriety of the attendance of any other person’ aside from a party or other essential person).
14 ibid Rule 22. See also ibid Rule 27 (providing the arbitrator similar authority in the context of a rule governing the attendance of expert witnesses at hearings).
15 ibid Rule 22. See also ibid Rule 27 (using identical language in the context of a rule governing the attendance of expert witnesses at hearings).
16 Cf Strong, Proper Procedural Choices (n 7) 633 (discussing this ‘direct interest’ language in the 2009 AAA Wills and Trusts Arbitration Rules and opining that ‘[w]hile this phrase may refer only to persons who have been formally joined in the proceedings, the language could be interpreted to include potential parties who have not yet officially joined the arbitration even though they have an interest in the outcome of the dispute.’).
17 Compare AAA Wills and Trusts Arbitration Rules (n 3) Rule 22, with American Arbitration Association, Commercial Arbitration Rules, effective 1 October 2013 (hereinafter AAA Commercial Arbitration Rules), Rule 25, <www.adr.org>.
18 American Arbitration Association, Employment Arbitration Rules, effective 1 November 2009 (hereinafter AAA Employment Arbitration Rules), Rule 23, <www.adr.org>.
20 CPR Administered Arbitration Rules (n 19) Rule 20.
21 See John H Langbein, ‘Living Probate: The Conservatorship Model’ (1978) 77 Michigan Law Review 63, 64–66.
22 Horton (n 10) 1030 (noting that ‘in an effort to prevent time-consuming and estate-depleting litigation, a rising number of testators and settlors are placing arbitration clauses in their dispositive instruments’); Murphy (n 10) 630, 635–36; Bridget A Logstrom, Bruce M Stone, and Robert W Goldman, ‘Resolving Disputes with Ease and Grace’ (2005) 31 ACTEC Law Journal 235, 235 (‘Our collective gut tells us that the administration of a will or trust would run more efficiently and at less cost if we could resolve disputes arising in those proceedings through the use of an arbitral, rather than judicial forum.’); Stanard T Klinefelter and Sandra P Gohn, ‘Alternative Dispute Resolution: Its Value to Estate Planners’ (1995) 22 Estate Planning 147, 151; Dominic J Campisi, ‘Alternatives to Litigation in Trust and Probate Proceedings’ (1987) 42 Arbitration Journal 30, 31–32.
23 AAA Wills and Trusts Arbitration Rules (n 3) Rule 9.
27 AAA Employment Arbitration Rules (n 18) Rule 8.
28 See eg CPR Administered Arbitration Rules (n 19) Rule 9.3 (‘The Tribunal shall hold an initial pre-hearing conference for the planning and scheduling of the proceeding.’).
29 AAA Wills and Trusts Arbitration Rules (n 3) Rule 28.
30 AAA Employment Arbitration Rules (n 18) Rule 24.
32 AAA Wills and Trusts Arbitration Rules (n 3) Rule 4.
34 See eg AAA Employment Arbitration Rules (n 18) Rule 4(b)(ii) (providing that the Respondent ‘may file an Answer with the AAA’ and that ‘[i]f no answering statement is filed within the stated time, Respondent will be deemed to deny the claim’); AAA Commercial Arbitration Rules (n 17) Rule 5(a) (same).
35 Cf Strong, Proper Procedural Choices (n 7) 632 (commenting that the AAA’s practice of labelling any party who did not initiate the arbitration a ‘respondent’ ‘fails to take into account the possibility that not all members of the so-called respondent group may be similarly situated’).
36 See Langbein (n 21) 64–66.
37 AAA Commercial Arbitration Rules (n 17) Rule 33. See also AAA Employment Arbitration Rules (n 18) Rule 27 (same).
38 AAA Wills and Trusts Arbitration Rules (n 3) Rule 20(a).
39 Cf AAA Employment Arbitration Rules (n 18) Rule 9 (‘The arbitrator shall have the authority to order such discovery, by way of deposition, interrogatory, document production, or otherwise, as the arbitrator considers necessary to a full and fair exploration of the issues in dispute, consistent with the expedited nature of arbitration.’).
40 AAA Wills and Trusts Arbitration Rules (n 3) Rule 30(c).
46 But see AAA Employment Arbitration Rules (n 18) Rule 39(c) (‘The award … shall provide the written reasons for the award unless the parties agree otherwise.’). Reasoned awards are the norm in international arbitration. See generally, SI Strong, ‘Reasoned Awards in International Commercial Arbitration: Embracing and Exceeding the Common Law-Civil Law Dichotomy’ (2016) 37 Michigan Journal of International Law 1.
47 See Strong, Proper Procedural Choices (n 7) 635 (positing that a reasoned award ‘is essential in an in rem type of proceeding’).
48 AAA Wills and Trusts Arbitration Rules (n 3) Rule 46.
50 See eg Office & Profl Employees Int’l Union v Brownsville Gen Hosp, 186 F3d 326, 331 (3rd Cir 1999).
51 Indeed, the Rules provide two such standard arbitration clauses, one of which is tailored to non-commercial trusts and one of which is tailored to commercial trusts. See AAA, Wills and Trusts Arbitration Rules (n 3) Standard Arbitration Clause for Wills and Non-Commercial Trusts; ibid at Standard Arbitration Clause for Commercial Trusts.
53 ibid at Standard Arbitration Clause for Wills and Non-Commercial Trusts. See also ibid at Standard Arbitration Clause for Commercial Trusts (providing a clause that is similar to the clause quoted in the text but differs in that it relates solely to trusts as opposed to wills and trusts).
54 9 USC s 9. See also David Horton, ‘Donative Trusts and the Federal Arbitration Act’ in SI Strong (ed), Arbitration of Trust Disputes: Issues in National and International Law (Oxford University Press 2016) paras 9.01–9.62 (considering whether and to what extent the FAA applies to internal trust arbitration).
55 Section 12 of the FAA provides that a party seeking to vacate or modify an arbitration award may do so within three months of the time the award ‘is filed or delivered’. ibid s 12. If the losing party does not file a motion to vacate the arbitration award within three months of the award, she cannot oppose a subsequently filed motion to confirm brought within one year. The Uniform Arbitration Act (UAA) and the Revised Uniform Arbitration Act (RUAA) similarly have ninety-day time limits in which to seek vacatur, modification, or correction of an arbitral award, although neither the UAA nor the RUAA has an express deadline for seeking to confirm the arbitration award. See Revised Uniform Arbitration Act ss 23–24 (2000); Uniform Arbitration Act (1955) ss 12–13. The UAA previously had been adopted in forty-nine states. The RUAA has now been adopted in eighteen states and the District of Columbia. See Uniform Law Commission, Legislative Fact Sheet—Arbitration Act (2000), <www.uniformlaws.org/LegislativeFactSheet.aspx?title=Arbitration%20Act%20(2000)>.
58 The UAA and the RUAA set forth provisions for challenging an arbitration award that are nearly identical to the grounds provided for in the FAA. See Revised Uniform Arbitration Act ss 23–24 (2000); Uniform Arbitration Act (1955) ss 12–13. Thus, the standards for judicial review are generally the same under federal and state law.
59 JAMS Comprehensive Arbitration Rules (n 19) Rule 24(k).
61 AAA Wills and Trusts Arbitration Rules (n 3) Rule 7(a).
62 The term ‘arbitrability’ can be understood in two senses. Internationally, the term refers to the question of whether the state will permit the dispute in question to be heard in arbitration. In the United States, the term also refers to the notion of who is to decide the question of arbitrability: the court or the arbitral tribunal. These latter concerns have also been referred to as ‘gateway issues’. Gary B Born, International Commercial Arbitration (2nd edn, Kluwer Law International 2014) 944, 1135.
63 Howsam v Dean Witter Reynolds, 537 US 79, 84 (2002).
64 ibid; First Options of Chicago, Inc v Kaplan, 514 US 938, 943 (1995).
65 First Options, 514 US at 943.
66 ibid 944 (internal quotation omitted).
69 AAA Wills and Trusts Arbitration Rules (n 3) Rule 7(a).
70 Compare ibid with AAA Employment Arbitration Rules (n 18) Rule 6.
71 Compare AAA Wills and Trusts Arbitration Rules (n 3) Rule (7)(a) with AAA Commercial Arbitration Rules (n 17) Rule 7(a) (using language identical to AAA Wills and Trusts Arbitration Rule 7(a) except with the additional phrase ‘or to the arbitrability of any claim or counterclaim’).
72 See eg Oracle Am., Inc v Myriad Grp AG, 724 F3d 1069, 1074 (9th Cir 2013) (‘Virtually every circuit to have considered the issue has determined that incorporation of the American Arbitration Association’s (AAA) arbitration rules constitutes clear and unmistakable evidence that the parties agreed to arbitrate arbitrability.’); Zenelaj v Handybrook, Inc, 82 F Supp 3d 968, 971-76 (ND Cal 2015) (discussing numerous cases).
73 Douglas v Regions Bank, 757 F3d 460, 464 (5th Cir 2014) (‘The two-part … test demands that even if there is a delegation provision (step one), the court must ask whether the averment that the claim falls within the scope of the arbitration agreement is wholly groundless (step two).’); Zenelaj, 82 F Supp 3d at 975 (‘If a court finds [in a case where the parties clearly and unmistakably have assigned the arbitrability issue to the arbitrator] that the assertion of arbitrability is not “wholly groundless,” it should stay the action pending a ruling on arbitrability by the arbitrator.’).
74 For a fuller discussion of the separability doctrine in the context of an arbitration clause found in a will, see E Gary Spitko, ‘The Will as an Implied Unilateral Arbitration Contract’ (2016) 68 Florida Law Review 49 (hereinafter Spitko, Implied Unilateral Arbitration Contract).
75 Buckeye Check Cashing, Inc v Cardegna, 546 US 440, 445 (2006).
77 Prima Paint Corp v Flood & Conklin Mfg Co, 388 US 395, 404 (1967).
79 See Rent-A-Center, West, Inc v Jackson, 130 S Ct 2772, 2786 (2010) (Stevens, J, dissenting) (‘Today the Court adds a new layer of severability—something akin to Russian nesting dolls—into the mix.’).
80 ibid 2777 (‘[T]he delegation provision is an agreement to arbitrate threshold issues concerning the arbitration agreement.’).
83 AAA Wills and Trusts Arbitration Rules (n 3) Rule 48(a).
84 See Kostakos v KSN Joint Venture No 1, 491 NE2d 1332, 1326 (Ill App Ct 1986) (‘The inclusion of [the AAA’s anti-waiver provision] indicates the parties’ intention to favor arbitration and we will not lightly waive this right.’).
85 See eg AAA Commercial Arbitration Rules (n 17) Rule 52(a); AAA Employment Arbitration Rules (n 18) Rule 42(a).
86 S&R Co of Kingston v Latona Trucking, Inc, 159 F3d 80, 85 (2nd Cir 1998) (adopting this interpretation of the language in Rule 48(a) and citing additional cases that have done the same).
87 See ibid (‘Thus, the fact that an arbitration agreement incorporates such a clause [containing the language in Rule 48(a)] would not prevent a court from finding that a party has waived arbitration by actively participating in protracted litigation of an arbitrable dispute.’); ibid 86 (‘Accordingly, we hold that the presence of the [AAA’s] “no waiver” clause does not alter the ordinary analysis undertaken to determine if a party has waived its right to arbitration.’). See also Home Gas Corp of Massachusetts, Inc v Walter’s of Hadley, Inc, 532 NE2d 681, 683–85 (Mass 1989) (engaging in standard waiver analysis and finding waiver despite inclusion of the AAA’s waiver provision in the arbitration contract); Haddock v Quinn, 287 SW3d 158, 176 (Tex Ct App 2009) (‘The presence of such a [AAA] “no waiver” clause in an arbitration agreement does not alter the ordinary analysis undertaken to determine if a party has waived its right to arbitration by litigation conduct.’); Gray Holdco, Inc v Cassady and RWLS, LLC, 654 F3d 444, 454 (3rd Cir 2011) (holding that despite an anti-waiver provision allowing either party to seek injunctive relief, ‘the question for purposes of finding an arbitration waiver remains whether [the party seeking arbitration], through its litigation conduct, waived its right to compel arbitration because of the prejudice [the party opposing arbitration] suffered attributable to [the first party]’s delay in invoking its right to arbitrate’).
88 See S&R Co of Kingston, 159 F3d at 86 (upholding the district court’s finding that a party had waived its right to arbitrate and holding that ‘the “no-waiver” clause in the AAA rule does not prevent a court from finding that a party has waived its right to arbitration’); Home Gas Corp, 532 NE2d at 685; Illinois Concrete-ICI, Inc v Storefitters, Inc, 922 NE2d 542, 547–48 (Ill App Ct 2010) (holding that parties seeking to arbitrate had ‘acted in a manner inconsistent with their right to seek arbitration’ and that the trial court had properly found that they had waived their right to arbitrate despite the AAA anti-waiver provision in the arbitration agreement); Haddock, 287 SW3d at 182 (holding despite AAA anti-waiver provision that the trial court did not abuse its discretion in finding waiver of the right to arbitrate where the party seeking arbitration ‘substantially invoked the judicial process … to the prejudice of’ opposing parties). See also Gray Holdco, 654 F3d at 461 (finding, despite an anti-waiver provision allowing either party to seek injunctive relief, that ‘the overall circumstances of this case indicate that [a party], through its litigation conduct, has waived its right to arbitrate’); Republic Ins Co v Paico Receivables, LLC, 383 F3d 341, 342, 348–49 (5th Cir 2004) (despite an anti-waiver clause providing that ‘[t]he institution and maintenance of an action for judicial relief … shall not be deemed a waiver’, finding waiver where the party seeking arbitration had ‘substantially invoked the judicial process to the prejudice of’ the opposing party).
89 Gray Holdco, 654 F3d at 453–54 (stating in a case involving an anti-waiver provision that ‘a court, by finding that there has been a waiver of the right to arbitrate predicated on a party’s litigation conduct, effectuates the principle that a party may not use arbitration to manipulate the legal process and in that process waste scarce judicial resources’). See also S&R Co of Kingston, 159 F3d at 86; Home Gas Corp, 532 NE2d at 685.
90 Strong, Proper Procedural Choices (n 7) 635, 635 n 273. Professor Strong also has argued that ‘[t]his type of non-waiver provision … protects the settlor’s desire to have all proper disputes heard in arbitration, since it stops parties from intentionally initiating litigation simply to eliminate the obligation to arbitrate’; ibid 635 n 274. A party who litigates an otherwise arbitrable matter does not, however, eliminate her obligation to arbitrate. Rather, she may eliminate her right to arbitrate. The other party may still successfully move to compel arbitration of the matter unless that party also has litigated to the extent that she too has waived her right to enforce the arbitration contract.
91 CPR Administered Arbitration Rules (n 19) Rule 13.2.
92 See eg SI Strong, ‘Arbitration of Trust Disputes: Two Bodies of Law Collide’ (2012) 45 Vanderbilt Journal of Transnational Law 1157, 1184 (suggesting that because ‘trust law can be quite specialized as a matter of both procedural and substantive law’ the settlor of a trust might especially value a decision-maker with expertise in the subject matter). See also Robert L Freedman and others, ‘ADR in the Trusts and Estates Context’ (1995) 21 ACTEC Notes 170, 171 (‘In many areas of the country the probate judges are becoming less and less specialized, while the trusts and estates practice, especially the tax aspects, has become increasingly specialized. Would it not be better in the future to try a trusts and estates case before an ACTEC Fellow than before a probate judge or jury?’).
93 E Gary Spitko, ‘Gone But Not Conforming: Protecting the Abhorrent Testator from Majoritarian Cultural Norms Through Minority-Culture Arbitration’ (1999) 49 Case Western Reserve Law Review 275, 297 (hereinafter Spitko, Abhorrent Testator). Cf Richard Z Kabaker, Joseph F Maier, and Frank Gofton Ware, ‘The Use of Arbitration in Wills and Trusts’ (1991) 17 ACTEC Notes 177, 183 (‘A testator’s choice of executor, friend, or relative as umpire is logical given their personal knowledge of the testator’s desires.’); Blaine Covington Janin, Comment, ‘The Validity of Arbitration Provisions in Trust Instruments’ (1967) 55 California Law Review 521, 532 (‘Because the settlor or the parties are free to select those whom they wish to decide future controversies, arbitrators may be chosen either on the basis of their knowledge in areas most likely to become the subject of dispute or because of their familiarity with the settlor and beneficiaries.’).
94 Spitko, Abhorrent Testator (n 93) 297 (arguing that arbitration allows a minority-culture testator to appoint a decision-maker who is familiar with and respectful of the values that informed the drafting of the estate plan and, thus, to overcome biases inherent in traditional probate litigation).
95 AAA Wills and Trusts Arbitration Rules (n 3) Standard Arbitration Clause for Wills and Non-Commercial Trusts. See also ibid at Standard Arbitration Clause for Commercial Trusts (providing a clause that is identical to the clause quoted in the text except that it lacks one typographical error contained in the clause quoted in the text).
97 ibid Rule 11(a). More specifically, Rule 11 provides for appointment of arbitrators from a list of ‘names of persons chosen by the AAA from its Wills and Trust [sic] and Commercial Panels’. ibid. It is unclear why the Wills and Trusts Rules provide for arbitrators from the commercial panel.
102 ibid Rule 3(a). See also ibid Rule 11(a).
103 American Arbitration Association, Expedited Procedures, Rule E-4, <www.adr.org>.
105 American Arbitration Association, Procedures for Large, Complex Commercial Cases, Rule L-2, <www.adr.org>.
106 Strong, Proper Procedural Choices (n 7) 636.
108 ibid. See also ibid 636 (labelling the drafters’ lack of specific attention to the nature of trust disputes ‘highly problematic given the many unique challenges associated with mandatory arbitration of internal trust disputes’).
109 AAA Wills and Trusts Arbitration Rules (n 3) Standard Arbitration Clause for Wills and Non-Commercial Trusts. See also ibid at Standard Arbitration Clause for Commercial Trusts (containing identical language minus the language respecting competency).
111 Strong, Proper Procedural Choices (n 7) 650 n351 (stating with respect to the 2009 AAA Wills and Trusts Arbitration Rules that ‘[t]here is little evidence that the AAA considered concerns relating to commercial trusts separately from those arising under non-commercial trusts.’).
112 See AAA Wills and Trusts Arbitration Rules (n 3) Standard Arbitration Clause for Wills and Non-Commercial Trusts; ibid at Standard Arbitration Clause for Commercial Trusts.
113 See ibid Rule 1(b)–(c).
114 See Strong, Proper Procedural Choices (n 7) 646 (noting that trust disputes may ‘involve the coordination of related claims brought by different individuals and the possibility of parallel proceedings’ in light of ‘the number of parties and the potential disparity of their relationship to each other and the trust itself’).
115 See eg Graves v Vitu, 2013 WL 499339, at *6-7 (WD Va 2013) (in a case interpreting a no-contest clause found within two trusts, a certain trust beneficiary was ‘required as a party to this litigation because permitting the action to proceed without her may impair her ability to protect her interests’ and ‘as a nonparty, [the beneficiary] would not be bound by any judgment rendered in this case and could, should she so desire, bring a state court action on the same grounds yielding the possibility of inconsistent results’).
116 Professor Strong has suggested that arbitral procedures specific to trust arbitration should take into account ‘matters regarding late-joining and non-participating parties, [and] special or virtual representation, including appointment and payment of the representative’. Strong, Proper Procedural Choices (n 7) 650; ibid 638. See also ibid 633 (noting that ‘some parties to a trust dispute may only wish to join or need to be joined at some point late in the proceedings [yet] the [2009 AAA Wills and Trusts Arbitration Rules do] not address the issue of late joinder’).
117 The RUAA contains provisions authorizing a court to consolidate separate arbitration proceedings upon a motion of a party to an arbitration agreement or proceeding. See Revised Uniform Arbitration Act s 10 (2000).
118 JAMS Comprehensive Arbitration Rules (n 19) Rule 6(e).
120 AAA Wills and Trusts Arbitration Rules (n 3) Rule 23.
121 Cf Strong, Proper Procedural Choices (n 7) 631–32 (noting that there are important differences between the 2009 AAA Wills and Trusts Arbitration Rules and the Procedures for Large, Complex Commercial Disputes and opining that ‘the AAA’s approach to the application of these alternative procedures is problematic because it puts procedural decisions in the hands of the AAA and, to a lesser extent, the parties, even though trust law has traditionally given precedence to the intent of the settlor in all matters concerning the trust’).
122 AAA Wills and Trusts Arbitration Rules (n 3) Rule 1(a).
126 See AAA Commercial Arbitration Rules (n 17) Rules 1(a), 12, 12(c), 13(a).
127 AAA Wills and Trusts Arbitration Rules (n 3) Standard Arbitration Clause for Wills and Non-Commercial Trusts.
128 ibid at Standard Arbitration Clause for Wills and Non-Commercial Trusts. A mental capacity challenge to a will or trust containing an arbitration clause raises complex separability issues. Compare Primerica Life Ins Co v Brown, 304 F3d 469, 472 (5th Cir 2002) (holding that a ‘capacity defense is part of the underlying dispute between the parties which, in light of [the separability doctrine], must be submitted to the arbitrator’), with Spahr v Secco, 330 F3d 1266, 1273 (10th Cir 2003) (concluding that ‘the analytical formula developed in [the Supreme Court’s separability jurisprudence] cannot be applied with precision when a party contends that an entire contract containing an arbitration provision is unenforceable because he or she lacked the mental capacity to enter into the contract’).
129 Horton (n 10) 1030; Erin Katzen, ‘Arbitration Clauses in Wills and Trusts: Defining the Parameters for Mandatory Arbitration of Wills and Trusts’ (2011) 24 Quinnipiac Probate Law Journal 118, 119; SI Strong, ‘Empowering Settlors: How Proper Language Can Increase the Enforceability of a Mandatory Arbitration Provision in a Trust’ (2012) 47 Real Property, Trust and Estate Law Journal 275, 287 (noting that ‘many US states have not yet addressed issues’ concerning the enforceability of mandatory trust arbitration). See also Rachal v Reitz, 403 SW3d 840, 848 (Tex 2013) (‘There is a dearth of authority as to the validity of an arbitration provision in a trust.’); McArthur v McArthur, 224 Cal App 4th 651, 656 (Cal Ct App 2014) (noting the lack of case law on the issue of whether a trust’s arbitration clause can bind a trust beneficiary).
130 Spitko, Implied Unilateral Arbitration Contract (n 74) (discussing this consensus and arguing that the FAA and state arbitration statutes require enforcement of an arbitration clause in a will even against a beneficiary who seeks to render the will a complete nullity). This consensus is consistent with a conditional gift or direct benefits estoppel theory to bind parties to the arbitration clause. See eg Rachal, 403 SW3d at 845–47 (relying upon direct benefits estoppel theory to bind a trust beneficiary to a trust’s arbitration clause where the beneficiary sought to enforce his rights under the trust); Horton (n 10) 1062 (arguing that ‘parties to an estate plan can agree to arbitrate by accepting benefits under the terms of an instrument that contains an arbitration clause’).
131 AAA Wills and Trusts Arbitration Rules (n 3) Rule 7(b).
133 Compare ibid with AAA Commercial Arbitration Rules (n 17) Rule 7(b).
134 Compare AAA Wills and Trusts Arbitration Rules (n 3) Rule 7(b) with AAA Commercial Arbitration Rules (n 17) Rule 7(b).
135 AAA Commercial Arbitration Rules (n 17) Standard Arbitration Clause.
136 Strong, Proper Procedural Choices (n 7) 628 (noting that ‘experts in arbitration do not encourage drafters to adopt these sorts of lengthy, ad hoc provisions, since the use of non-standard language can lead to disputes over the scope and interpretation of the operative terms’).