Appealing from Arbitration Decisions

Arbitration is essentially an informal trial in which each party presents its case to a neutral arbitrator who hears the evidence and decides the case. In some cases, parties may elect to participate in arbitration. In others, arbitration may be mandatory based on either a contract or a statute. Most counties in Washington require parties to transfer their matters to mandatory arbitration if the amount in controversy is less than $100,000. However, the threshold amount varies in certain counties, so it is important to review the relevant local court rules.

In cases involving a contract for arbitration, whether a decision can or cannot be appealed may be included in the terms of the parties’ contract. But in the absence of terms regarding appeals, or in cases involving mandatory arbitration, the arbitrator’s decision can generally be appealed by either party if they disagree with the arbitration award.

To appeal from a mandatory arbitration ruling, a party can request a “trial de novo.” The request must be filed within 20 days of the arbitrator’s decision, and should generally be in the format laid out in MAR Rule 7.1. Once the request is filed and served on all parties, the court will seal the arbitrator’s award and the trial de novo will be conducted as if the arbitration never occurred. Parties may not refer to the arbitration award at trial, but may use testimony that was given at arbitration, to the extent that it is allowed by the rules of evidence.

When considering an appeal, one should be aware of the substantial risk involved in requesting a trial de novo. Per MAR Rule 7.3, the court shall assess costs and reasonable attorney fees against a party who appeals the award and fails to improve their position at trial. In other words, if a party loses at arbitration and loses again at trial, that party will be responsible for paying the opposing party’s legal fees. Additionally, if a party requests a trial de novo and later withdraws that request, the court may still require payment of the other party’s legal fees.

So, while appealing arbitration decisions is possible, there is always risk involved. The option to appeal is there, but should not be taken lightly.