Not always can a dispute be settled without some court intervention or other assistance from a third party. In some instances parties opt for mediation and appoint a third party to act in that role to help them through a settlement process. But for some, despite their efforts, they are unable to close the gap. Their option is to go to court, queue up and try to be heard by a judge who has an enormous case load and little time or staff to deal with the press of business. Another option is to hire a private or “rent a judge” The judge and the parties and the court all sign documents appointing the third party as a private judge. The judge is paid by the parties but because of the efficiency of that judge, money is saved over a court process that can drag for months to years.
One private judge relayed to me his experience is that each side saves $2 or more for each dollar they spend on a private judge. That’s because there’s no waiting around for hours and hours, travel time is either zero or less than if you have to go to the courthouse (private trials are usually held in an attorney’s conference room), there are no interruptions for other cases or ex partes or folks who come in with a stipulation, which judges reward by giving them priority over whatever contested matter is being heard. If the attorneys can estimate correctly how much time a trial or big Order to Show Cause will take, the hearing or trial can be scheduled so that the matter can be heard to completion without having to break it up into bits and pieces; thus saving the client money because the lawyer doesn’t have to keep re-preparing. Some private judges will even conduct a lot of hearings, both noticed and ex partes, telephonically, which saves even more time and money. You and the other side also choose who the judge will be.
While the single most valuable benefit to litigants is that it actually saves the parties money there are other benefits. Consider that a lot of the bumps along the way can be resolved quickly and cheaply through telephone conference calls. Consider the lawyers are in the middle of a deposition with a discovery dispute. That could result in the deposition being adjourned and the matter being briefed and presented to the court or call the private judge, tell him what it is, and get an answer.
With a private judge, you get orders that are legally identical in their effect to orders obtained from a judge in the courthouse. They are enforced exactly the same way. The parties have the same rights of appeal whether the order or judgment is issued by a private judge or by one sitting in the courthouse.