Arbitration is a process for resolving disputes outside of court. Certain types of cases filed in the New Jersey Court system are handled through arbitration. If any parties involved in the lawsuit is dissatisfied with the results of arbitration, they can ignore the results of the arbitration and still go to trial and have their day in court.
Arbitration is often effective in giving a party to a lawsuit an unbiased assessment of the strength and weaknesses of that party’s case.
Here is how it works. The court appoints an arbitrator to the case. The arbitrator is an experienced attorney who practices in the county where the case has been filed. Each side submits to the arbitrator a statement which lays out the case from that party’s perspective and includes evidence such as copies of documents, deposition transcripts, interrogatory answers and affidavits. The arbitration is scheduled and usually takes place in a room in the courthouse, not necessarily in a court room. The parties and their lawyers sit on the opposite side of a table and the arbitrator allows each side to present its case. The parties may choose to bring witnesses to the arbitration, but usually the evidence in the statement is what is considered by the arbitrator. The strict rules of evidence and other court processes do not apply. The arbitrator may ask some questions and then the arbitrator renders a decision as if the arbitrator is a judge or a jury. One side wins and one side loses.
The arbitrator’s decision is non-binding. If either party is dissatisfied with the decision, the party files a paper with the court within 30 days to notify the court that the party has rejected the arbitrator’s decision and instead wants to proceed to trial.
Although the arbitrator’s decision is often rejected by the losing party, the decision is helpful in fostering settlement discussions among the parties and their attorneys. An unbiased decision has been rendered and that can often educate the parties about the strength and weaknesses of their case.
If neither party rejects the decision within 30 days, the decision becomes final and is binding as a final resolution of the case. The case does not proceed to trial.
Arbitration is scheduled for lawsuits involving car accidents, slip and fall cases and other matters in which a party is seeking recovery for personal injuries. It is also scheduled for contract disputes, commercial matters, product liability case and certain insurance cases.
Look for other blog posts on the topics of Discovery, Expert Witnesses, Mediation, Legal Malpractice and the Trial.