The fundamental difference between litigation and arbitration is that, in arbitration, the parties pay someone to adjudicate their dispute. Despite this added expense, a properly conducted arbitration should work out to be less expensive than litigation. Where arbitration follows mediation, many issues may already be resolved, or at least narrowed to their key points. This means the arbitration can focus on discreet, important issues such as specific parenting or financial matters that aren’t resolved.
Litigation costs are often proportionate to the management of the matter, so the more carefully managed, the lower the costs. An arbitrator can also manage or bypass many statutory pre-trial procedural steps, so time can be used much more efficiently, and focus on the issues that matter to the parties. Arbitration means greater schedule control as well. The court day starts at 10 a.m., with a 30-minute mid-morning break, a 90-minute lunch recess, a 30-minute afternoon break, and ends at 4:30. This means there are four hours working time in the average court day.
An arbitration day can start at 9 a.m., or when the parties want. With a short lunch and fewer, shorter breaks, and arbitration day can deliver as much as eight hours of working time. This means an arbitrator may hear almost double the evidence a court judge would in the same time span. Also, the parties have more control over the schedule and timing of their arbitration. This makes it less likely that a three-day hearing will turn into five days, which also helps control costs.
Arbitration offers process flexibility, so parties can dispense with unnecessary formalities and create a process that works for them. An arbitrator has more latitude than a judge to make the process work specifically for the parties and the matters they care about.
Hearings can be conducted with affidavit evidence and limited cross-examination. The parties can also agree that all evidence be in written form, with the right to make submissions. The final offer selection process – where each party makes their best or final offer, and the arbitrator must pick one without any changes - is a particularly efficient and cost-effective approach for family law arbitration. In this approach, each party strives to be reasonable and realistic, so their offer will be chosen.
When creating a residential schedule, or calculating arrears or retroactive support, the arbitrator’s agreement can give the arbitrator authority to break impasses. The arbitrator can answer procedural questions by phone or email, reducing the number of meetings on minor issues. This also means getting answers on the case’s schedule, not the courts.
The family law court system also includes at least three settlement conference appearances. These court appearances are not required in an arbitration. If each court appearance costs around $5,000, that’s $15,000 which isn’t needed for an arbitration. A conference call or management meeting will take about 90 minutes. There aren’t any documents produced, and you don’t need a brief. The arbitrator just needs to know what the case is about.
Costs are reduced, because the process is streamlined. This makes the case move faster, with fewer process and timing impediments. This is one of the reasons why many clients opt for mediation/arbitration, where mediation is followed by arbitration of matters that weren’t resolved in mediation. It’s an effective one-two punch, with both parties knowing it’s in their best interest to resolve issues, reduce the need for arbitration, and avoid litigation. We discuss the merits and drawbacks of mediation, arbitration, and litigation with our clients, so they understand their options, and have a clear picture of how their case can be resolved.
Herschel Fogelman is the founder and principal of Fogelman Law, a family law firm in Toronto. Herschel is a Best Family Lawyer, and is listed in the Lexpert Directory. An experienced family law mediator, arbitrator, and litigator, Herschel pioneered Customized Case Management, a unique service that streamlines and customizes the processes and schedule in family law cases.