In law, a special referee acts as a judge on matters of fact only.
Explanation
In many instances, the interpretation of the specific statutes or case law relevant to a dispute is absolutely clear. The uncertainty between the parties 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 or litigation but, on an inter partes 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 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. Such clauses cannot limit or deny the right of either party to refer the matter to a court. 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 of many states allows the court to refer the matter to a special referee when this will both provide expertise on the facts, and enable the legal case to be disposed of in a more timely fashion. For example, in Canada, the Arbitration Act provides: As with most legal terminology, there is some variation by jurisdiction in the precise nomenclature used: in some jurisdictions a special referee is known as a "master", "special master" or "auditor".
