Unveiling Fairness for the Consumer:The Law, Economics and Justice of Expanded Arbitration

In recent years, the US Supreme Court has rather controversially extended the ambit of the Federal Arbitration Act to extend arbitration’s reach into, inter alia¸ consumer matters, with the consequence that consumers are often (and unbeknownst to them) denied remedies which would otherwise be available. Such denied remedies include recourse to class action proceedings, effective denial of punitive damages, access to discovery and the ability to resolve the matter in a convenient forum.

The court’s extension of arbitration’s ambit is controversial. Attempts to overturn this extension have been made in Congress, but to no avail. In contrast to American law, European consumer law looks at pre-dispute agreements to arbitrate directed at consumers with extreme suspicion, and does so on the grounds of fairness. In contrast, some argue that pre-dispute agreements in consumer (and employment) matters are consumer welfare enhancing: they decrease the costs of doing business, which is then passed on to the consumer. This Article examines these latter claims from both an economic and normative perspective.

The economic analysis of these arguments shows that their assumptions do not hold. Rather than being productive of consumer surplus, the use of arbitration is likely to have the opposite effect. The industries from which the recent Supreme Court cases originated not only do not exhibit the industrial structure assumed by the proponents of expanded arbitration, but are also industries which exhibit features that facilitate consumer welfare reducing collusion.

The normative analysis addresses the fairness concerns. It is explicitly based upon John Rawls’ notion of “justice as fairness,” which can provide a lens to evaluate social institutions. This Rawlsian analysis considers the use of extended arbitration in consumer matters in the light of the earlier economic results. It suggests that the asymmetries present in the contractual allocation of rights serve as prima facie evidence that such arbitration–induced exclusions are prima facie unjust/unfair. However, as asymmetry is only a prima facie test, a generalized criticism of the arbitration exclusions (of the sort found in Congress and underlying the European regime) is overbroad.

Young people, crime and justice in Northern Ireland

Many children and young people in conflict with the law in Northern Ireland have experienced living in poverty, truancy or exclusion from school, limited educational attainment, neglect or abuse within their families, placement in alternative care, drug or alcohol misuse, physical and mental ill-health. However, their lives are also affected by the legacy and particular circumstances of a society in transition from conflict. In addition to historical under-investment in services for children and their families, this includes discriminatory policing alongside informal regulation by ‘paramilitaries’ or members of ‘the community’ and community-based restorative justice schemes as an alternative way of dealing with low-level crime and ‘anti-social’ behaviour.

Following a Criminal Justice Review, the 2002 Justice (Northern Ireland) Act affirmed that the principal aim of the youth justice system is to protect the public by preventing offending by children’. Youth justice initiatives therefore encompass a range of responses: early intervention to prevent offending and the application of civil Anti-Social Behaviour Orders, diversionary measures (including community-based restorative justice schemes), non-custodial disposals for those found guilty of offences, and custodial sentences. While ‘policy transfer’ prevailed during periods of ‘direct rule’ from Westminster, the punitive responses to ‘sub-criminal’ and ‘anti-social’ behaviour introduced by the 1998 Crime and Disorder Act in England and Wales were resisted or not implemented in the same way in Northern Ireland.

This Chapter will critically analyse the debates informing recent developments, noting key issues raised by the 2011 review of youth justice initiated as a priority following the devolution of justice and policing to the Northern Ireland Assembly. It will focus on promotion and protection of the rights of children and young people in conflict with the law.