Well, there are two components to the answer. The first is philosophical (what we’re doing now: philosophy of law) and the other is entrepreneurial (actually putting out a shingle as a dispute arbitrator). I think you’re asking me to give an answer to the latter with only the tools of the former, an impossibility. In other words, until there is a thriving market in dispute-resolution, there really is nothing but my speculation versus your speculation on how such a market would operate.
That being said, there have been nearly-free markets in dispute-resolution and I would direct your attention to David Friedman’s many online articles and lectures as he’s the only person I’m aware of that has done real leg-work in studying historical legal systems under conditions of greater freedom in the market of dispute-resolution. This imposes a discipline on the speculation that cannot be had any other way.
At a high level, yes, I think that the arbitrator would be functioning as a kind of “referee” of the dispute… if someone makes an argument that is blatantly circular, he might point out that logical fallacies are not a solid basis for long-lasting legal settlements as people tend to realize later on that the terms they’ve agreed to were all based on mumbo-jumbo reasoning. Or, if someone applies a double-standard, he might point out that it is absurd to expect someone to settle a dispute on significantly different terms than you would be willing to settle the very same dispute if things were the other way around. Or, if someone goes into listing what a great person they are and what a terrible person the other party is, the arbitrator might point out that everyone praises themselves and abuses their enemies so such lists are really a waste of everyone’s time and why not let’s get down to actually settling the dispute?
Common sense morality is not a formal basis of the legal order, in my view. To reiterate, I was merely making the much weaker claim that deontological morality is not the basis of the legal order in an unhampered market (contrary to the present system that is based on deontological morality, where the commands of the State (statutes) are the highest moral commands of all).
Instead of passing a value judgment on the current system, I prefer to characterize it in terms of the health of the social order. A doctor who says “You need to go on a diet and lose weight” is not saying “Thou shalt not overindulge” or “Gluttony is an abomination to God”… he is saying that your body is unhealthy (as evidenced by its dysfunction) and that if such-and-such steps are taken, its health can be improved. The doctor can say this because he has studied the objective functions of the body, so he has criteria by which to assess dysfunction. We can do the same at the social level - though sociology is a more challenging science than medicine, that is, it is much more challenging to get scientific results of the same significance.
I think a lot of people perceive that the modern social order is dysfunctional. Unlike ordinary disease - where an individual generally knows when he is sick or the doctor can apply an objective test to determine that the individual is sick - it is very challenging to put into words precisely what is meant by asserting that the modern social order is dysfunctional. But that doesn’t mean that it’s impossible and that there is no objective function of the social order by which its dysfunction can be measured.
Clayton -