Non-Binding Arbitration in Florida

Pursuant to Florida Statutes, Section 44.103 and Florida Rule of Civil Procedure 1.820, the Courts have the power to order the parties to a lawsuit to participate in Non-Binding Arbitration.

What is a Non-Binding Arbitration?

Unlike a trial, non-binding arbitration in Florida is a statutorily created, relatively informal presentation of a party’s case, made to an individual or panel of arbitrators, who then render a decision based upon the presentation of the parties. 

How do you end up in a Non-Binding Arbitration?

FS 44.103 provides that a “court, pursuant to rules adopted by the Supreme Court, may refer any contested civil action filed in a circuit or county court to nonbinding arbitration.”   While it is the Court that orders the parties to arbitration, any party may also file a motion to refer the matter to non-binding arbitration.

Once ordered to arbitration, either the Court may appoint the arbitrator(s) or the parties may be able to agree upon the appointment of the arbitrator(s).

What happens in arbitration?

FS 44.103(4) states, “presentation of testimony and evidence shall be kept to a minimum, and matters shall be presented to the arbitrators primarily through the statements and arguments of counsel.”  The parties can agree in advance of the hearing to certain “ground rules”, i.e. witnesses, if any, exhibits, experts, etc.  See also, Fla. R. Civ. P. 1.820(c).

The arbitration itself must conclude within 30 days of the first hearing, unless extended by a motion filed by the arbitrator or a party.  Within 10 days of the adjournment of the hearing, the arbitrator shall notify the parties of their decision.  See Fla. R. Civ. P. 1.820(g)(3).

I got a decision, now what?

Was it a favorable decision?  Good, try to keep it that way.

Was it an unfavorable decision?  You’re in luck, since the decision is non-binding, there is a process in place to get back in front of a judge and try again.  Within 20 days of receiving the arbitrator’s written decision, any party may move for a trial de novo.  Fla. R. Civ. P. 1.80(h).  The trial de novo is a potential second bite at the apple. 

Florida case law is relatively lax on the standard for obtaining a trial de novo, “where a valid request is made, “nothing in the language of the statute or the rule supports the conclusion that the trial court has the discretion to deny a party’s timely motion for trial.” Dungarani v. Benoit, 312 So. 3d 126, 131 (Fla. Dist. Ct. App. 2020).

If no party moves for trial de novo within 20 days of the arbitration award, then the decision is sent to the judge for entry of judgment in accordance with findings and conclusions of the arbitrator.  Id.

Should I go to non-binding arbitration?

As with anything in life and litigation, there are benefits and costs to going to non-binding arbitration.

Pros:

• Non-binding arbitration provides a persuasive but not binding look at the evidence in the case where the case may go if presented to a judge or jury.
• A favorable award provides that party with leverage to negotiate a favorable settlement.
• Even if the award is unfavorable, it provides a party with more information to make a better decision and potentially avoid incurring additional costs and fees at a potentially sunken goal.
• Non-Binding Arbitration also acts a practice run for any presentation and allows a party to see what arguments the other side intends to make.

Cons:

• Non-binding arbitration also means that if you get a award you like, the other side will try as hard as they can to seek a new trial.
• Further, significant costs can be imposed on the party seeking a new trial, including:
  • Costs of the new trial and attorney’s fees if you are the Plaintiff seeking a new trial and your recovery is 25% or more below the amount rewarded at arbitration.
    • Those costs will be offset against the judgment amount.
    • If that cost figure exceeds the amount of the judgment in Plaintiff’s favor, then a judgment is issued in favor of the Defendant.
  • Costs of the new trial and attorney’s fees if you are the Defendant seeking a new trial and your judgment against you is 25% or greater than the arbitration award.
  • See Stat. 44.103(6)(a) and (b).

What should I do?

As with any decision with major legal implications, you should seek the advice of counsel.  Non-Binding Arbitration can be a useful tool during a pending lawsuit.  If you have been ordered to Non-Binding Arbitration, or want to pursue arbitration as an avenue to resolving your current disputes, the attorneys at Kirwin Norris have years of experience representing construction industry clients in arbitration.

By Andrew J Pekoe