Fitting the Forum to the Fuss with Sticky Defaults: Failure on the Market for Dispute Resolution Services?

Barendrecht, Maurits; Vries, B.R. de

doi:10.2139/ssrn.572042

Cited by 7 publications

(6 citation statements)

References 12 publications

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“…Compared with complaint mechanisms for other services, where a customer can pick up the phone and give his feedback to a call center, appeals are extremely formal and costly. Private arbitration procedures usually do not include the possibility of appeal, which suggests that parties setting up these procedures usually think they are too costly in comparison to the advantages (Landes and Posner 1979;Barendrecht, Bolt et al 2006).…”

Section: Protecting Clients and Monitoring Neutrals Through Appealsmentioning

confidence: 99%

Growing Justice: Justice Policies and Transaction Costs

Barendrecht

2009

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This paper reviews the literature on policies aiming to improve the rule of law and the operation of a legal system. It takes a bottom up perspective of clients seeking access to justice and uses transaction costs on the market for justice as a criterion to evaluate justice policies. Most justice is created through 'justice transactions,' including informal help from friends, legal advice, information about law, ADR services, other forms of informal justice, and adjudication. Such transactions are seriously hampered by three major transaction cost problems, however.Justice policies include codification, setting up courts and reforming them, financing of courts, legal aid, ADR, developing rules of procedure, and regulation of the legal profession. The transaction cost perspective explains why many traditional justice policies do a poor job to increase access to justice or to diminish the costs of civil justice. More promising justice policies enable justice to emerge bottom up, in the interactions between clients and providers of justice services (microjustice, legal empowerment). These policies focus on the information needs of disputants, low cost default procedures, choice for plaintiffs, accountability towards clients, gradual, needs-based formalization of legal relationships, and strengthening informal compliance mechanisms.1 Helpful comments on an earlier version were provided by

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Section: Protecting Clients and Monitoring Neutrals Through Appealsmentioning

confidence: 99%

Growing Justice: Justice Policies and Transaction Costs

Barendrecht

2009

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“…Such agreements are rare (Shavell 1995;Barendrecht and De Vries 2006). Where a defendant is offered the option of mediation, rejection rates are high (Moore 2003).…”

Section: Transaction Costs Of Meetingmentioning

confidence: 99%

“…Such agreements would be very effective tools to diminish legal costs, and to tailor the procedure to the needs of the litigants. But they hardly occur (Barendrecht and De Vries 2006). In actual litigation practice, agreements about the way to conduct court proceedings do not extend beyond very practical arrangements about logistics.…”

Section: Transaction Costs Of Meetingmentioning

confidence: 99%

“…This second order negotiation problem seems to be difficult to solve, for reasons similar to the first order problem. The psychological barriers that impede the resolution of a conflict itself, are also likely to show up when the parties talk about the way to solve the conflict (Barendrecht and De Vries 2006). Reactive devaluation occurs when a disputant distrusts an opponent's proposal regarding a suitable dispute resolution procedure (Ross 1995).…”

Section: Transaction Costs Of Meetingmentioning

confidence: 99%

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Understanding the Market for Justice

Barendrecht

2009

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If justice is so dearly needed, why does it not emerge spontaneously? Socio-legal research shows how people shop for justice. They approach friends, advisers, lawyers, mediators, suppliers of legal information, local authorities, community leaders, priests, imams, arbiters, or judges in order to obtain redress in situations of conflict. From the perspective of clients, law is probably not so much a system of procedures in which they face barriers to access, but a variety of options on a market for justice services. In this paper, five types of justice services are distinguished. Whether these services are affordable for clients and sustainable to supply, depends on the costs of production and on the transaction costs of making them available. Investigating the sources of transaction costs for each of these justice services improves our understanding of the legal system. This perspective explains why ADR has hardly succeeded in attracting clients, lawyer services are unlikely to become a commodity, norms for distributive issues are often lacking, and courts have trouble to orient themselves on the needs of their customers. It also indicates which type of policies governments and civil society can consider if they wish to improve access to justice.

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“…As a result, for some theory (and the donor practice it influences), competition is king: Botero et al (2003) adopt such an approach to present a model of judicial reform, for example, that argues for "incentive-oriented reform… to increase accountability, competition and choice" between legal institutions and between judges; this is reiterated by Cabrillo and Fitzpatrick (2008: 58) and extended to the provision of legal services (232). At the level of practice, Barendrecht and de Vries (2005) highlight ADR -including non-state justice systems -as a means to foster "innovation" and generate healthy competition in the market for legal services. We do not argue that all donor policy and practice in the field of rule of law reform is underpinned by a belief in competition between institutions; rather, this is the logical extension of an approach that reifies institutions and removes them from the meaning systems that generate, contest and redefine them continuously.…”

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confidence: 99%