Court-annexed arbitration is nonbinding but penalizes frivolous trial demands

Evidence

Court-annexed arbitration might also be called compulsory arbitration. The court assigns selected civil cases to arbitration, usually those involving relatively small sums of money, as a precondition to or substitute for trial. Nevada, for example, requires that all civil actions that arise out of automobile accidents and involve less than 15,000 must be submitted to arbitration. The arbitrator, usually designated by the state, hears arguments and evidence and renders a decision, applying the same legal standards that a judge would apply. If the parties accept the arbitrator’s ruling, it is formalized as the court’s judgment in the case. If either party objects to the ruling, it can demand a trial of the case; thus, the arbitrator’s decision is not binding. In most jurisdictions, however, financial penalties discourage frivolous appeals of arbitrators’ rulings. In Colorado, for example, unless the party demanding trial improves its position by more than 10 percent, it must pay up to 1,000 of the costs of the arbitration proceeding. — G. Alan Tarr, Judicial Process and Judicial…, 1169

Categorization

• DEFINE: Contrasts court-annexed (compulsory, nonbinding) arbitration with voluntary arbitration — key distinction the course tests.
• XREF: connects to: Court-annexed arbitration is nonbinding but penalizes losing appeals — G. Alan Tarr, Judicial Process and Judicial…, 2350; Arbitration has expanded from labor disputes into commercial industries — G. Alan Tarr, Judicial Process and Judicial…, 2342

Broader Connections

• Court-annexed arbitration is nonbinding but penalizes losing appeals #qualifies (0.88) — G. Alan Tarr, Judicial Process and Judicial…, 2350