If you are separating and have been unable to resolve one or more family law issues through negotiation or mediation, family arbitration may provide an alternative to having a judge decide the dispute in Court. In arbitration, the parties present their positions to a neutral arbitrator, who makes a decision called an Arbitration Award.
Family arbitration can be more private and flexible than Court. However, it is not simply another settlement meeting. The arbitrator has authority to make a binding decision, and the parties must satisfy specific legal requirements before an Award will be enforceable.
Family arbitration in Ontario is a private dispute-resolution process in which the parties agree to have a qualified arbitrator decide one or more family law issues. The parties must enter into a written arbitration agreement and receive independent legal advice. While arbitration may be faster and more flexible than court, it also involves private fees, binding decisions and potentially limited appeal rights.
Family Arbitration Allows a Private Arbitrator to Decide Family Law Disputes
Family arbitration is a process in which a neutral third party hears the evidence and arguments of both parties and makes a decision about the issues submitted to arbitration. The decision is called an Arbitration Award.
In Ontario, family arbitration may address issues that could otherwise be dealt with in a domestic contract, such as child support, spousal support, property issues and parenting matters. The arbitration must be conducted in accordance with the law of Ontario.
For more information about arbitration, click here.
Sources: Family Law Act, R.S.O. 1990, c. F.3, ss. 51, 59.1; Arbitration Act, 1991, S.O. 1991, c. 17, s. 32.
Both Parties Must Agree Before Family Arbitration Can Begin
Family arbitration is generally voluntary. One party cannot simply require the other party to proceed to arbitration because they prefer it over Court. The parties must agree to submit the dispute to arbitration and define the issues that the arbitrator will be asked to decide.
The family arbitration agreement must be in writing and must comply with Ontario law. In most cases, the agreement is entered into after the particular dispute has arisen. This helps ensure that the parties understand the actual issues they are agreeing to place before the arbitrator.
The arbitration agreement can also address procedural matters, including the identity of the arbitrator, the issues in dispute, how evidence will be presented, and the available rights of appeal.
Sources: Family Law Act, R.S.O. 1990, c. F.3, ss. 55(1), 59.4, 59.6; O. Reg. 134/07, s. 2.
Independent Legal Advice and Screening Are Important Safeguards
Each party must receive independent legal advice before entering into the family arbitration agreement if the resulting award is to be enforceable. The lawyer providing that advice must complete a certificate confirming that independent legal advice was provided.
Family arbitrators must also satisfy specific qualification requirements. The parties are screened separately for power imbalances and domestic violence so that concerns about coercion, safety or a party’s ability to participate fairly can be identified before the arbitration proceeds.
These safeguards are particularly important because arbitration results in a binding decision. For an example of how screening issues can affect family arbitration, click here.
Sources: Family Law Act, R.S.O. 1990, c. F.3, s. 59.6; O. Reg. 134/07, ss. 2–4.
The Arbitration Process Can Be More Flexible Than Court
Family arbitration does not have to follow the same procedure as is required by the Court. Subject to the arbitration agreement and the governing legislation, the arbitrator can determine how the process will proceed.
Depending on the dispute, the arbitration may proceed largely through written documents or may include a hearing where witnesses give evidence and the lawyers make oral submissions. In either case, both parties must be treated equally and fairly and must have an opportunity to present their case and respond to the other party’s position.
At the end of the process, the arbitrator issues a written award with reasons. The arbitrator must apply the governing law rather than decide the dispute solely on what they consider personally fair.
For more information about the family arbitration process, including factors to consider when deciding whether arbitration may be appropriate for your circumstances, click here.
Sources: Arbitration Act, 1991, S.O. 1991, c. 17, ss. 19, 32, 38; O. Reg. 134/07, s. 4.
Family Arbitration Has Private Costs That Court Proceedings Do Not
Unlike a judge, a private arbitrator charges professional fees for the time spent managing, hearing and deciding the dispute. The parties must therefore consider the arbitrator’s fees in addition to the legal expenses that may arise in presenting their case.
Depending on the issues and complexity of the case, arbitration costs may include:
- The arbitrator’s hourly or daily fees;
- Legal fees for independent legal advice and, if retained, representation during the arbitration;
- Fees for experts, valuators or other professionals whose evidence is required; and
- Other expenses associated with preparing evidence or conducting the hearing.
There is no single fixed price for family arbitration. A shorter and more focused arbitration may cost less than a lengthy court proceeding, but a complex arbitration involving extensive evidence, multiple hearing days, or expert witnesses can still be expensive.
The arbitrator may also have authority to make a costs award. This means that one party may be ordered to contribute toward some of the other party’s legal or arbitration expenses, depending on the arbitration agreement, the parties’ conduct, and the outcome.
Sources: Family Law Act, R.S.O. 1990, c. F.3, s. 59.6; Arbitration Act, 1991, S.O. 1991, c. 17, s. 54.
An Arbitration Award Is Binding and Appeal Rights May Be Limited
One of the most important risks of arbitration is that the arbitrator is being asked to make a binding decision. A party should not enter arbitration assuming that they will simply be able to ask a judge to reconsider the case if they disagree with the result.
The available appeal rights depend in part on the arbitration agreement and the nature of the issue being appealed. Where the agreement does not provide otherwise, an appeal on a question of law generally requires permission from the Court. Appeals on questions of fact or mixed fact and law are available only where the arbitration agreement provides for them.
Sources: Arbitration Act, 1991, S.O. 1991, c. 17, s. 45; O. Reg. 134/07, s. 2.
Procedural Problems Can Put An Arbitration Award at Risk
Although arbitration is more flexible than Court, basic procedural fairness still applies. Each party must receive a fair opportunity to know the case they have to meet, present their own case and respond to the other party’s evidence and arguments.
A Court may set aside an arbitration award in certain circumstances. These can include an invalid arbitration agreement, an award that goes beyond the issues the parties agreed to arbitrate, a failure to treat a party equally and fairly, serious procedural non-compliance, fraud or a reasonable apprehension of bias.
Family arbitration also has strict enforceability requirements. If the required written agreement, independent legal advice or other statutory safeguards are missing, an award may not be enforceable.
Sources: Family Law Act, R.S.O. 1990, c. F.3, ss. 59.6, 59.8; Arbitration Act, 1991, S.O. 1991, c. 17, s. 46.
A Family Arbitration Award Can Be Enforced Through the Court
A valid family arbitration award is not merely a recommendation. A party who is entitled to enforcement can ask the Superior Court of Justice or the Family Court to make an order in the same terms as the award, subject to the statutory requirements and any pending appeal or application to set the award aside.
If there is already a family Court proceeding between the parties, enforcement is generally sought by Motion in that existing proceeding rather than by starting a new application.
Sources: Family Law Act, R.S.O. 1990, c. F.3, s. 59.8; Arbitration Act, 1991, S.O. 1991, c. 17, s. 50.1.
Family Arbitration Can Be Useful, But It Is Not Risk-Free
Family arbitration can offer privacy, scheduling flexibility and a process that can be tailored to the particular dispute. It may also allow the parties to select an arbitrator with family law experience rather than wait for a Court hearing.
At the same time, arbitration involves significant commitments. The parties must pay the private arbitrator, comply with the arbitration agreement and accept that the arbitrator will make a binding decision. Appeal rights may be narrower than a party expects, and procedural or drafting problems can create later disputes about whether the award is enforceable.
Before agreeing to family arbitration, a party should understand the issues being submitted, the anticipated procedure and fees, the available appeal rights and the possible consequences of the award. Independent legal advice is not only an important safeguard; in most family arbitrations, it is also a statutory requirement for enforceability.
Accordingly, obtaining legal advice from a qualified family lawyer before proceeding with family arbitration is important to ensure that you understand the process, its potential consequences, and whether it is appropriate for your circumstances.
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Categories: Arbitration, Alternative Dispute Resolution, Family Law, Separation.
