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.
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