In past times, arbitration of family law matters was reserved primarily for wealthier clients who were willing to “pay for a judge” to have their matter concluded more expeditiously and by an adjudicator with whom they had confidence. As the success of ADR processes has continued to grow, arbitration of family law matters is making its mark as a more efficient and less expensive alternative to going to court, thereby making it a viable option for more people.
In North Carolina, the arbitration of matters related to marital separation and divorce, including child custody, child support, postseparation support, alimony, and equitable distribution, is conducted pursuant to the North Carolina Family Law Arbitration Act (“FLAA”). Although the FLAA sets forth rules for the arbitration procedure, the parties can readily adapt the process to meet their specific needs. Since the entire process is essentially agreement driven, the parties can agree upon almost all of the relevant ground rules, including details of scheduling. This provides the parties with significant control over the manner and timeframe in which their matters are resolved.
Generally, the arbitrator functions as a private judge who is chosen by the parties. When the parties choose their arbitrator, they can select someone whom they believe has the time and requisite skill set to understand the sometimes complex factual and legal issues presented in family law cases.
Of all of the ADR processes, arbitration is the one that most closely simulates the litigation experience. Arbitration can allow the parties to feel that they have had adequate due process. Parties who are concerned about time limitations imposed by the court system often feel that they have not had an ample opportunity to fully tell their side of the story. One of the benefits of arbitration is that the parties have more flexibility in the time that is allotted to testimony and evidence, and they can choose an arbitrator who is prepared to devote adequate time to the hearing of their matter.
In accordance with the FLAA and the parties’ agreement, the arbitrator may, among other things, hear and rule on motions, enter scheduling and discovery orders, and issue subpoenas for the appearance of witnesses or production of documents. The arbitration hearing may be conducted with the same formality of a trial, or the parties may agree on more relaxed rules and adapt the process for efficiency. As an example, the arbitrator may conduct preliminary hearings by telephone conference call with the attorneys, rather than requiring the attorneys, and possibly the parties, to appear in court at a date and time set by the judge. The parties can also agree to a less formal presentation of evidence which can serve to decrease the amount of time required to present the case to the arbitrator.
In certain situations the parties may elect to have particular issues or aspects of the case determined in stages. For example, if one of the issues in controversy is the value of a business, the parties can agree to have that issue decided before the presentation of the remainder of the case. A decision on such a critical issue can lead to settlement of the remaining issues without further arbitration proceedings. This is one of the ways that arbitration may reduce the parties’ overall litigation expenses.
The arbitration hearing is confidential and can be conducted in a comfortable and private environment. Parties who value privacy can avoid having highly personal, financial, or business information discussed in a public courtroom where anyone can attend. Moreover, documents and exhibits used in the proceeding do not become part of a public record that may be viewed by the public. This can be especially important if the parties do not want their children or others to know the personal, and often intimate, details that may be revealed in the proceedings.
The parties and the arbitrator can agree on a specified timeframe in which the arbitrator has to render an award. Judges, who are burdened by heavy trial calendars and administrative matters, may take three to nine months (or even longer) to enter a written order following the hearing of a complicated or contentious case. For each month that a case goes undecided, the parties remain in limbo, often unable to move forward until their legal matters are resolved.
Arbitration of family law matters is typically binding, meaning that both parties agree to accept the arbitrator’s award as a final decision and waive their right to a trial or an appeal. In this regard, arbitration can be an effective method for providing the parties with finality and closure. However, since the parties can agree upon applicable rules, they can specify in their agreement whether an arbitrator’s award can be appealed and, on what basis, such as the arbitrator making an error of law.
Another favorable aspect of arbitration is that it can occur in conjunction with other ADR processes, such as mediation/arbitration. If settlement is not reached at mediation, the parties can agree to allow the mediator to arbitrate the matter. Allowing the mediator to “change hats” and serve as arbitrator could allow for a more abbreviated hearing since the arbitrator will have learned about the history of the case and the issues in dispute through the mediation process.
Decisions made in family related legal matters can have broad implications that go beyond the immediate legal issues. If you are considering arbitration, choosing an arbitrator with the right skill set can make a positive difference in the experience you and your clients have with the process.
Howard L. Gum, a founding partner at the law firm of Gum, Hillier & McCroskey, P. A., focuses his ADR practice on controversies arising from family financial matters and marital contracts, including the following:
- premarital agreements;
- postnuptial agreements;
- separation agreements;
- child support;
- postseparation support and alimony; and
- equitable distribution
Howard’s experience as a family law practitioner, and his extensive knowledge of family law and arbitration procedures, ensures that the decisions he makes as an arbitrator are sound and well reasoned. His studious perspective, pragmatic approach, and creative problem-solving skills are a complement to any case in which he serves as arbitrator, but can be particularly valuable to those cases that involve high income, substantial assets, and complex legal issues.
Howard is committed to the highest ethical and professional standards and to fairly adjudicating all matters in which he arbitrates.