In law

Law

Law is a system of rules and guidelines which are enforced through social institutions to govern behavior, wherever possible. It shapes politics, economics and society in numerous ways and serves as a social mediator of relations between people. Contract law regulates everything from buying a bus...

, a special referee acts as a judge

Judge

A judge is a person who presides over court proceedings, either alone or as part of a panel of judges. The powers, functions, method of appointment, discipline, and training of judges vary widely across different jurisdictions. The judge is supposed to conduct the trial impartially and in an open...

 on matters of fact only.

Explanation

In many instances, the interpretation of the specific statute

Statute

A statute is a formal written enactment of a legislative authority that governs a state, city, or county. Typically, statutes command or prohibit something, or declare policy. The word is often used to distinguish law made by legislative bodies from case law, decided by courts, and regulations...

s or case law

Case law

In law, case law is the set of reported judicial decisions of selected appellate courts and other courts of first instance which make new interpretations of the law and, therefore, can be cited as precedents in a process known as stare decisis...

 relevant to a dispute is absolutely clear. The uncertainty between the parties

Party (law)

A party is a person or group of persons that compose a single entity which can be identified as one for the purposes of the law. Parties include: plaintiff , defendant , petitioner , respondent , cross-complainant A party is a person or group of persons that compose a single entity which can be...

 lies in the facts. Hence, a special referee is an expert in the factual topic, whether it be shipping, civil engineering, accounting, etc. He or she hears evidence and makes factual findings which bind the parties. This will usually be sufficient for the parties to resolve the dispute since the law can now be applied. If the parties still cannot agree, they may initiate proceedings for arbitration

Arbitration

Arbitration, a form of alternative dispute resolution , is a legal technique for the resolution of disputes outside the courts, where the parties to a dispute refer it to one or more persons , by whose decision they agree to be bound...

 or litigation but, on an inter partes

Inter partes

The term inter partes is the Latin for "between the parties." It can be distinguished from in rem, referring to a legal action whose jurisdiction is based the control of property, or ex parte referring to a legal action that is by a single party....

 basis, the facts are conclusively determined by the judgment of the special referee and only questions of law may be argued before the new forum. Thus, the use of a special referee provides a relatively swift and cost-effective mechanism for dispute resolution

Dispute resolution

Dispute resolution is the process of resolving disputes between parties.-Methods:Methods of dispute resolution include:* lawsuits * arbitration* collaborative law* mediation* conciliation* many types of negotiation* facilitation...

 if only because the procedure is less formal than in a court and the referee's existing expertise reduces the need to continually explain complex technical and factual matters to a judge who has only legal expertise.

Scope

The parties may anticipate the possibility of a dispute and nominate a special referee as the most appropriate form of dispute resolution (see forum selection clause

Forum selection clause

A forum selection clause in a contract with a conflict of laws element allows the parties to agree that any litigation resulting from that contract will be initiated in a specific forum...

). Such clauses cannot limit or deny the right of either party to refer the matter to a court (whether in the state nominated or, if the contract does not specify a state, in any court prepared to accept jurisdiction subject to the rules on forum shopping

Forum shopping

Forum shopping is the informal name given to the practice adopted by some litigants to get their legal case heard in the court thought most likely to provide a favorable judgment...

).

If there is no anticipatory provision in the contract, the parties may, of their own initiative, seek out a person qualified to act as a special referee and submit the factual case to him or her for resolution. Although costs will be involved in legal representation, fees to witnesses, and in the fee to the special referee, the expenditure will be a fraction of the costs of full-scale litigation.

If there is no agreement between the parties, the civil procedure

Civil procedure

Civil procedure is the body of law that sets out the rules and standards that courts follow when adjudicating civil lawsuits...

 of many states allows the court to refer the matter to a special referee when this will both provide exertise on the facts, and enable the legal case to be disposed of in a more timely fashion. For example, in Canada

Canada

Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...

, the Arbitration Act provides:

14. (1) Subject to rules of court and to any right to have particular cases tried by a jury, the court or a judge may refer any question arising in any cause or matter, other than a criminal proceeding by the Crown, to an official or special referee for inquiry or report. The report of an official or special referee may be adopted wholly or partially by the court or a judge, and if so adopted may be enforced as a judgment or order to the same effect.