Members of the Diamond Dealers Club have an effective mechanism to resolve disputes that arise among them. This is the organization’s arbitration or dispute resolution mechanism, which all members must follow.
According to the DDC By-Laws, every member “having any claim or controversy arising out of or relating in any way to the diamond, precious stone or jewelry business” against any other “member or group of members, must file his complaint in writing” with the DDC. This dispute will be heard by a panel of DDC arbitrators, who are elected to this position, and who serve without pay.
All arbitrators are governed by the By-Laws of the Diamond Dealers Club, as well as various government rules and regulations. Members have agreed in writing, as a condition of their membership, to arbitrate their disputes with other members, including those with members of other diamond exchanges, or bourses, affiliated with the World Federation of Diamond Bourses.
Arbitration has major advantages to the public court system to which members may not bring their disputes with fellow members. The first is an arbitration is conducted relatively quickly. A typical case is heard by the arbitrators within three weeks and decided by them shortly thereafter. The public court system that may take literally years to hear a claim and arrive at a decision.
Another advantage is that the arbitrators are familiar with the diamond business and the rules governing trade. Also, arbitrations are a relatively inexpensive way to resolve disputes. They do not require lawyers or filing of papers, but rather supporting documents instead of briefs.
In the DDC arbitration system, a panel of five arbitrators serves on a case. They include the panel chairman, two arbitrators and an alternate chairman and alternate arbitrator (in the event that one of the original three members is unable to serve).
DDC arbitrations also provide for the possibility of an appeal. An appeal panel consists of five arbitrators plus two alternates of whom three are elected arbitration panel chairmen.
An arbitration is initiated by the plaintiff filing a complaint and providing supporting documents, including any written agreements that may exist. This claim is then sent to the opposing party with a scheduled date for the hearing.
Once an arbitration decision has been reached, the parties are notified in writing. The losing party may choose to appeal it. If the award is unpaid, the winning party may go to New York State Supreme Court within one year of the decision to get a judgment against the losing party. This judgment may then be used to attach the losing party’s assets.
If the losing party fails to pay, the winning party may have the losing party’s picture posted in the Club and on the DDC website with a notice that a DDC arbitration award has not been paid. Furthermore, the winning party may seek to have the losing party suspended from the DDC which, if approved by the Club’s Board of Directors, would lead to that person being barred from all of the Club’s affiliated with the World Federation of Diamond Bourses..