I recently went looking for a simple definition of arbitration and ended up going around in circles.
Wiktionary, the online dictionary, defines arbitrate as to either make a judgement in a dispute as an arbitrator, or to submit a dispute to such a judgment. Arbitrator is then defined as a person to whom the authority to settle or judge a dispute is delegated.
The Oxford English Dictionary is even less helpful. It defines arbitrate as to “reach an authoritative judgement or settlement.” Arbitration is “the use of an arbitrator to settle a dispute,” and arbitrator is “an independent person or body officially appointed to settle a dispute.”
Many arbitration statutes have similarly circular definitions.
For example, the Ontario Arbitration Act defines an “arbitration agreement” as “an agreement by which two or more persons agree to submit to arbitration a dispute that has arisen or may arise between them.” But it does not define arbitration. The Alberta Arbitration Act is similar.
Neither Act defines arbitrator, except to say it includes an umpire.
The British Columbia Arbitration Act does provide more detailed (but equally circular) definitions. Arbitration is “a reference before an arbitrator to resolve a dispute under this Act or an arbitration agreement.” An arbitrator is defined as a person who resolves a dispute referred to them under the Act or an arbitration agreement, and expressly includes an umpire. And an arbitration agreement is “a written or oral agreement between 2 or more persons to submit present or future disputes between them to arbitration…”
Several recent cases, in Canada and elsewhere, remind us that arbitration is arbitration, no matter what you call it.
Earlier this year, the United States Second Circuit Court of Appeals provided a reminder that arbitration can be any process that “manifests an intention by the parties to submit certain disputes to a specified third party for binding resolution.” This intention doesn’t need to be expressed in any particular language.
The court decided that a binding appraisal of a loss claimed on an automotive insurance policy was arbitration, even though it was not called that in the insurance contract. The appraisal provision identified a category of disputes that would be submitted to specified third parties for a binding determination of the amount of the loss. That was enough to make it arbitration and, therefore, the relevant law governing arbitration applied. (In this case, giving the court jurisdiction over the dispute.)
It is worth...