COMPULSORY ARBITRATION - Part IV: Predictions & Awards 1

Compulsory Arbitration – Predictions and Awards

Despite the automatic right to appeal any arbitration ruling, compulsory arbitration does have its uses.  In reasonably common cases involving minor injuries, car crashes and the like, arbitration can be useful, particularly when an insurance company has accepted the defense of the case.  Insurance companies defend so many cases, and so many of those cases are worth less than the $50,000 arbitration limit, that they have enough experience to make reasonably accurate predictions based on the outcomes and monetary awards in arbitration.  Arbitrations in this context can greatly assist in settlements, or, if the award is consistent with what the Defendant or its insurer thinks it will likely achieve in the superior court, the awards are often accepted.

Outside of this context, however, the arbitration process is far less useful.  If the case involves any complexity or is unusual in any significant way, accurate predictions based on the arbitration award are far less common, and thus the usefulness of the outcome and award is far less likely to be accepted.

Michael L. Kitchen

Disclaimer: This blog is for information purposes only. Legal advice is provided only through a formal, written attorney/client agreement.