Non-binding arbitration is a type of

arbitration Arbitration is a formal method of dispute resolution involving a third party neutral who makes a binding decision. The third party neutral (the 'arbitrator', 'arbiter' or 'arbitral tribunal') renders the decision in the form of an 'arbitrati ...

in which the arbitrator makes a determination of the rights of the parties to the dispute, but this determination is not binding upon them, and no enforceable

arbitration award An arbitration award (or arbitral award) is a final determination on the jurisdiction, merits, costs or other aspect of a dispute by an arbitration tribunal in an arbitration, and is analogous to a judgment in a court of law. It is referred to as ...

is issued. The "award" is in effect an advisory opinion of the arbitrator's view of the respective merits of the parties cases. Non-binding arbitration is used in connection with attempts to reach a negotiated settlement. The role of an arbitrator in non-binding arbitration is, on the surface, similar to that of a mediator in a

mediation Mediation is a structured, voluntary process for resolving disputes, facilitated by a neutral third party known as the mediator. It is a structured, interactive process where an independent third party, the mediator, assists disputing parties ...

. However, the principal distinction is that whereas a mediator will try to help the parties find a middle ground to compromise at, the arbitrator remains totally removed from the settlement process and will only give a determination of liability and, if appropriate, an indication of the quantum of

damages At common law, damages are a remedy in the form of a monetary award to be paid to a claimant as compensation for loss or injury. To warrant the award, the claimant must show that a breach of duty has caused foreseeable loss. To be recognized at ...

payable. Subsequent to a non-binding arbitration, the parties remain free to pursue their claims either through the courts, or by way of a binding arbitration, although in practice a settlement is the most common outcome. The award and reasoning in a non-binding arbitration is almost invariably inadmissible in any subsequent action in the courts or in another arbitration tribunal. Non-binding arbitration is utilised mostly in the

United States The United States of America (USA), also known as the United States (U.S.) or America, is a country primarily located in North America. It is a federal republic of 50 U.S. state, states and a federal capital district, Washington, D.C. The 48 ...

and

Canada Canada is a country in North America. Its Provinces and territories of Canada, ten provinces and three territories extend from the Atlantic Ocean to the Pacific Ocean and northward into the Arctic Ocean, making it the world's List of coun ...

. It is largely unknown in Europe, although in the

United Kingdom The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom (UK) or Britain, is a country in Northwestern Europe, off the coast of European mainland, the continental mainland. It comprises England, Scotlan ...

there is a practice of parties who are seeking a settlement to jointly instruct a

King's Counsel A King's Counsel (Post-nominal letters, post-nominal initials KC) is a senior lawyer appointed by the monarch (or their Viceroy, viceregal representative) of some Commonwealth realms as a "Counsel learned in the law". When the reigning monarc ...

or Queen's Counsel for an opinion on the merits and likely quantum of a claim, and then to negotiate on the basis of the views expressed in that opinion.

In fiction

*In the

Michael Crichton John Michael Crichton (; October 23, 1942 – November 4, 2008) was an American author, screenwriter and filmmaker. His books have sold over 200 million copies worldwide, and over a dozen have been adapted into films. His literary works heavil ...

book, '' Disclosure'' (and in the 1994 film of the book), the sexual harassment claim relating to the lead character, Tom Sanders, is subject of a non-binding arbitration, which finds in his favour, but the other parties reject the determination.

External links

Non-binding arbitration online
{{law-stub Arbitration