Arbitration: Family Law’s Best Kept Secret

(Part 1 of 2)

Court is slow, public, costly and often hostile. There are many reasons that litigation is rarely a Plan A, especially in family law cases. There are too few judges, and too many cases. The trend in recent years is for the over-burdened court system to encourage people to try alternatives, such as arbitration.  It isn’t at all unusual for a case to take at least a year or more. The NC Family Law Arbitration Act states “It is the policy of this State to . . .  provide for arbitration as an efficient and speedy means of resolving these disputes . . .”[1] This article is part 1 of 2 on the topic of arbitration.

What Is Family Law Arbitration?

Arbitration is one form of alternative dispute resolution (ADR), meaning it is an alternative to the traditional process of court to settle disputes. ADR can be used only if both parties agree to use it. Unlike other types of ADR such as mediation or collaborative family law, when parties ultimately decide whether to settle their case, those who choose arbitration hire a third-party who makes the decision for them as a judge would. Courts enforce written agreements to arbitrate if a party tries to back out of it. If a lawsuit is already underway, parties can still agree to use arbitration. In contrast to a trial in the courtroom, parties who choose arbitration usually hold the proceedings in an office of one of the attorneys.

What Issues Can You Arbitrate?

All “issues arising from a marital separation or divorce, except for the divorce itself” can be submitted to an arbitrator.[1] This includes alimony, child custody and support, and equitable distribution of marital property. Even though the arbitrator can rule on custody and child support, the court always has the final say if a parent later files a motion with the court. Disputes about changing child support or alimony can also be arbitrated. In fact, future spouses can even agree to participate in family law arbitration before they get married except for child custody and support and the divorce itself.[2]  The divorce in our state requires only a one year separation and it is extremely rare for that to be contested. Technically, it requires a lawsuit even if it is uncontested. 

Arbitrators

Arbitrators are typically chosen by both parties, but if necessary, the court will appoint one if the parties can’t agree on who should arbitrate. The usual custom is to select the arbitrator certified by the North Carolina chapter of the AAML [3]. The parties usually share the cost of the arbitrator but they are free to choose another arrangement. Although they aren’t judges, arbitrators have the authority to make a ruling on a case, as does a judge. They can swear in witnesses and issue subpoenas to witnesses but they can’t hold someone in contempt of court for disobeying a court order, nor can they send someone to jail. The court reserves the ultimate authority to oversee those matters or the task of imposing sanctions (often financial penalties) if parties refuse to provide documents or fail to comply with other duties in a lawsuit.

What Is the End Result?

The arbitrator’s written decision is called an award. The court “confirms” an award made by the arbitrator, making it an official order of the court, enforced as any other court order. Or, if the parties agree to keep everything private, the award can be fashioned as a contract, which doesn’t get filed in public court records. Another feature of arbitration is the finality of it. Although the parties can agree to allow an award to be appealed, they can also agree to do binding arbitration, which means they agree the award is final and cannot be appealed.  

Read Arbitration: Family Law’s Best Kept Secret (Part 2 of 2)

[1] NC Gen. Stat. §50-41
[2] NC Gen. Stat. §50-42
[3] American Academy of Matrimonial Lawyers