Some jurisdictions provide specialized courts that focus on commercial disputes. These courts provide judges with experience in issues that frequently arise in commercial disputes so that litigants are comfortable that the judges understand the matters they present. They also follow special rules that were written specifically for commercial disputes.
But not all litigants prefer commercial courts, nor do all commercial disputes qualify to be heard in them.
Why should you continue reading this post about specialized commercial courts?
You are considering filing a lawsuit and are considering filing in a specialized commercial court
You just read something really interesting and now need something calm to read
You love reading but hate books, newspapers, emails, and magazines
Many State Courts Have Commercial Courts
Many state courts in the United States have special commercial sections. For example, the New York State court system has a Commercial Division. The Commercial Division generally only hears cases where the amount at stake is greater than a minimum threshold (as high as $500,000 in Manhattan, as low as $50,000 elsewhere in the state) and that concern certain subjects as set forth in Section 202.70(b) of the New York State Supreme Court rules, such as breach of contract cases. Similar courts exist in places like North Carolina, Atlanta, Phoenix, and Pittsburgh. And although it is not limited to commercial disputes, Delaware’s Court of Chancery is famous for its expertise in business law.
In New York, litigants that want their cases heard in the Commercial Division need to request that their case be assigned there. And if the Commercial Division decides that the case does not belong there, it can assign it away. The prospect of submitting to the jurisdiction of a judge that does not specialize in commercial disputes may raise concerns for some litigants. But in my experience, state court judges who do not work in a specialized commercial court are still well-versed in business law and capable of handling commercial disputes.
Many litigants, however, choose not to file cases in commercial courts. In my experience, some litigants are unaware that the courts exist. Additionally, many litigants prefer federal courts, which do not specialize in commercial cases, but which still provide sophisticated judges and rules.
Commercial Courts Are Common in Other Countries
The United States is not the only country with specialized commercial courts.
The United Kingdom’s court system has a Commercial Court. Belgium’s has a Tribunal de l’enterprise. And Spain has Juzgados de lo Mercantil. China has one, the China International Commercial Court, but it is only for international commercial disputes.
I find the Tribunal de Commerce in Paris particularly interesting. The judges in are not lawyers, but instead businesspeople who are elected by other businesspeople. Because they are not required to have studied law, they receive legal training once they are appointed. And appeals from this court go to a special commercial chamber of France’s highest court, the Cour de Cassation.
Specialized Commercial Arbitration Is Common, Too
Sophisticated businesses often agree to resolve their disputes through private arbitration instead of by going to court. Arbitration has numerous advantages, such as being confidential instead of public and being generally less expensive. But another advantage is that the parties can provide input on the selection of their arbitrator and thus can select an arbitrator and a forum that is well-suited for commercial disputes.
In the United States, two organizations that are well-known for commercial arbitration services are the American Arbitration Association (the “AAA”) and JAMS. The AAA publishes a list of the type of commercial cases for which it claims expertise, as does JAMS. And while many of the arbitrators are former judges, others are lawyers with experience in commercial disputes or businesspeople with relevant experience.
Outside of the United States, several organizations specialize in providing arbitration specifically for commercial disputes. These include the London Court of International Arbitration, the Hong Kong International Arbitration Centre, and the Arbitration Institute of the Stockholm Chamber of Commerce. Like commercial courts, these organizations provide judges with expertise in business disputes. But regardless of the arbitration forum, the United Nations Commission on International Trade Law has promulgated standard rules that often govern commercial arbitration between parties from different countries.
One thing I like about the Stockholm Institute is that it provides an easy calculator to estimate arbitration costs, which is useful in business disputes.