Use of Expert Determination as an ADR Method Part 2: Pros and Cons

The first article in this series introduced expert determination as an Alternate Dispute Resolution (ADR) mechanism in which parties appoint an independent subject matter expert to issue a binding decision on a dispute. This second article examines its practical application by outlining the key advantages and potential risks, helping parties assess when expert determination is well-suited and when alternative mechanisms may be more appropriate.

When used in the right circumstances, expert determination offers several compelling advantages:

1. Privacy and Confidentiality: The process is conducted privately, protecting sensitive commercial information.
2. Deep Technical Expertise: The decision-maker brings specialist knowledge of the subject matter — often exceeding that of the parties involved.
3. Procedural Flexibility: Compared to court, arbitration, or adjudication, expert determination is less formal and not bound by strict procedural rules, enabling a more open and collaborative process.  
4. Binding Outcome: Decisions are typically final and binding, with only limited grounds for challenge.
5. Inquisitorial Approach: The expert determiner may exercise investigative powers similar to, or greater than, those of an adjudicator.
6. Speed and Cost Efficiency: The process is generally faster and more cost effective than traditional dispute resolution mechanisms.
7. Effectiveness for Technical Disputes: It is particularly well-suited to discrete technical, quantum, or valuation issues — like delay analysis, defect assessments, variations, or equipment valuations — where technical expertise outweighs legal interpretation.
8. Non-Adversarial Environment: The process encourages constructive dialogue, allowing parties to exchange views without the adversarial pressures of cross-examination.
9. Opportunity for Clarification: Parties can refine their analyses and address information gaps without undermining their credibility.
10. Greater Transparency of Issues: Key matters are typically explored with the expert determiner in advance, leaving little room for unexpected outcomes at the decision stage.

Notwithstanding these benefits, expert determination carries certain risks if it is not selected or implemented appropriately:

1. It is generally not suitable for disputes that primarily revolve around legal issues rather than technical or factual matters.
2. The best technical expert in the industry is not necessarily the best expert determiner.  In addition to technical expertise, the expert determiner must possess strong procedural skills and the ability to manage the process effectively.  A lack of procedural competence can result in a loss of control over the proceedings.
3. The expert determiner must have a clear understanding of their jurisdiction — the power and scope of determination granted by the parties’ referral. Any breach of jurisdiction may render the decision vulnerable to challenge.
4. Experts are typically appointed or instructed by one party, which can make it challenging to adopt a fully neutral mindset. Any perceived bias can quickly undermine the process and the credibility of the decision.
5. The outcome depends heavily on the expert determiner’s competence, impartiality, and procedural capability. A poor appointment can lead to an unsatisfactory outcome or increase the likelihood of a successful challenge.
6. Expert determination is best suited to narrow issues — broader disputes involving contract interpretation, multiple claims, or significant legal questions are typically better addressed through arbitration or litigation.
7. Prior dealings between the expert determiner and one of the parties — common in highly specialized fields — can raise concerns around neutrality that may be more difficult to manage than in formal arbitration.

In addition to the points above, expert determination is most effective where the parties are willing and able to collaborate. If the relationship has deteriorated into significant hostility, this method may not be the most appropriate ADR option.

In upcoming articles, we will further explore several of these advantages and risks in greater detail.

^{© Copyright 2026. The views expressed herein are those of the author(s) and not necessarily the views of Ankura Consulting Group, LLC, its management, its subsidiaries, its affiliates, or its other professionals. Ankura is not a law firm and cannot provide legal advice.}