What is Arbitration and How Does it Work?

By Brittany Koenig, Paralegal Navigator, Calgary

Arbitration is a good alternative dispute resolution option for family law conflicts as it is generally more cost effective than Court and there is more flexibility over the process. But what is arbitration, and how does it work?

What is Arbitration?

Arbitration is a voluntary alternate dispute resolution process where parties in conflict agree to hire a neutral third-party adjudicator (the arbitrator) to render a decision on their legal issue. In other words, you get to hire your own judge!

The process mirrors the mediation process in many ways but differs in that the arbitrator has the power to make a legally binding decision. That decision is referred to as an arbitration award. The arbitration award is written decision that the parties are legally required to adhere to as long as it remains in effect (similar to a Court order).

Arbitrators practicing in the province of Alberta are bound by the Alberta Arbitration Act, which sets out the rules that govern aspects of the process including the arbitration hearings, the authority of the arbitrator, and the powers to appeal the award. The Alberta Arbitration Act is like the Alberta Rules of Court, which outlines the procedures to follow in Court.

Some people choose arbitration over court because you can often get your matter settled much more quickly. Also, what happens in arbitration can be confidential. In addition, because you can choose to streamline the procedures to address your matter in arbitration, it can cost less than a trial in court.

How Does Arbitration Work?

The Pre-Arbitration Call
Once the decision has been made to proceed with arbitration and an arbitrator is agreed upon, it is common for the parties to participate in a pre-arbitration conference call with the arbitrator to determine:

1. The legal issues to be decided in arbitration

2. The process to follow in arbitration, which may include:

  • How the arbitration hearing will proceed - either in-person, videoconference, via telephone, etc.
  • What documents must be exchanged and when that will occur
  • What evidence is to be filed with the arbitrator and when that evidence must be filed and served
  • The length of time needed to conduct the hearing
  • Whether there will be any witnesses, expert or otherwise
  • Any other aspect of the process that the parties wish to discuss

The pre-arbitration call is also an opportunity for the parties to ask questions so they have a clear understanding of billing, communication and any other relevant factors to determine before arbitration gets started.

The Arbitration Agreement

After the pre-arbitration call, the arbitrator will provide the parties with an arbitration agreement that sets out the terms of their retainer. The arbitration agreement will include the administrative aspects of the retainer, billing, any rights to appeal, and the specific legal issues that the parties have agreed to arbitrate.

Once you sign the arbitration agreement you are locked into arbitration and you cannot choose court instead, so read the agreement carefully!

The Arbitration Hearing

An arbitration hearing is less formal than a court trial. Arbitrations typically take place in boardrooms with no observers. Everyone in attendance is dressed formally in business attire but the arbitrator and any lawyers in attendance do not wear robes. The arbitrator is not called “your honour” but is referred to by their last name.

In arbitration the parties can choose the type of process that works for them. Sometimes this involves only written documents and written arguments. In this process, each side will file an affidavit with their evidence and then file written arguments.

However, the parties can also make arbitration more formal and very similar to a court trial. This can involve live witnesses who are questioned by each side while the arbitrator watches. If there is live evidence, a court reporter may also be present to record the proceedings. The record of the proceedings is also referred to as the transcript and, if a court reporter is present, the parties will be provided with the necessary information to order a transcript if they so choose, but this will be an extra cost.

After the hearing concludes, the arbitrator is responsible to prepare and serve each party with their formal written decision (similar to a Court order) called the arbitration award. As per Section 38 of the Alberta Arbitration Act, the arbitration award must:

  • Be made in writing
  • Include the location and date when the award was granted
  • Be signed by the arbitrator
  • Served on all parties

Within 30 days from the date that the arbitration award is granted, and as per Section 43 of the Alberta Arbitration Act, either party or the arbitrator may amend the award to correct any injustice caused by an oversight by the arbitrator or correct any grammatical, typographical, or calculation errors.

Appealing an Arbitration Award

The arbitration agreement will either allow for appeals or not and, unless otherwise provided, the parties have 30-days to file an appeal.

Per Section 44(1) of the Alberta Arbitration Act, if the arbitration agreement allows for appeals then either part may appeal the arbitration award on:

  • a question of law
  • a question of fact
  • a question of mixed law and fact

If the arbitration agreement does not allow for appeals, then the party wishing to appeal must first seek leave of the Court to appeal (meaning they must apply to the Court to ask if they can appeal and must be granted permission from the Court to be able to file an appeal).

On appeal, the Court has the authority to:

  • Vary or change the award as they see fit
  • Set the award aside
  • Send it back to the arbitrator with direction on the conduct of the arbitration

How Much Does Arbitration Cost?

Most family law arbitrators bill on an hourly rate that ranges from $250 per hour up to $1,000 per hour, depending on their experience. There is also normally a retainer, which is a lump sum upfront payment for the arbitrator.

Though this may seem pricey, it is often much less expensive than if the matter were to go to trial in court. This is because you can choose a streamlined process in arbitration and there is less delay. In addition, it is common for the arbitrator’s fees to be shared between the parties.


Once the arbitration award has been served upon the parties and takes effect, the parties are legally bound to adhere to it. If either party fails to comply with the terms of the arbitration award, the other party can make an application to the Court to enforce the award.

If you have not retained a lawyer and you are proceeding with arbitration as a self-represented litigant, Coach My Case has a team of experienced legal coaches who can work with you in the background to prepare you for your arbitration. This includes assisting with drafting your documents, letters and research. We can also help with strategy, training and legal advice. Call us today for your free consultation on more tips on representing yourself in arbitration.