Arbitrating High-Stakes Cases

Court-annexed arbitration, which requires the referral of civil cases to nonbinding arbitration before a lawyer-arbitrator, has become an increasingly common feature of civil procedure, though it has been largely confined to state court programs for small tort cases. In the past decade, however, arbitration procedures have increasingly been used in the federal district courts, which tend to apply such procedures to much larger cases and to contract cases as well as torts. This report describes a four-year study of court-annexed arbitration in the U.S. District Court for the Middle District of North Carolina. The study examined the efficacy of court-annexed arbitration in high-stakes federal tort and contract cases. The study found the program had few negative effects and many positive ones, including improved access to the justice system, reduction of private litigation costs, and favorable reactions by both litigants and attorneys. The success of the arbitration program in the Middle District of North Carolina shows that alternative dispute resolution can produce benefits for disputants in large-stakes cases.