December 8th, 2009
Awards, Grounds for Vacatur, Nuts & Bolts, Nuts & Bolts: Arbitration, Practice and Procedure, Reinsurance Arbitration
Part I: Introduction
An arbitration award is effectively a contract resulting from a contract. Two parties agree to appoint arbitrators, submit their dispute to arbitration and abide by the award. The parties ordinarily consent to entry of judgment on the award, and it can be confirmed under Section 9 of the Federal Arbitration Act (or a state law equivalent when the Federal Arbitration Act doesn’t apply). Alternatively it may be enforced through the plenary and summary procedures applicable to ordinary contracts (subject to any special rules governing arbitration awards).
So what happens when things go awry — or at least seem to have gone awry — and the arbitration award is or appears to be fundamentally unfair, divorced from the contract or the result of fraud, bias, or some form of prejudicial misconduct on the part of the arbitrators? Section 10 of the Federal Arbitration Act provides a safety net in the form of a motion or petition to vacate the award. (State arbitration statutes and law applicable in actions to enforce arbitration awards generally provide similar recourse, but our focus here is on the Federal Arbitration Act.) Continue Reading »
May 1st, 2009
Awards, Nuts & Bolts, Nuts & Bolts: Arbitration, Practice and Procedure
Introduction
Today we briefly review the limitation periods applicable to applications to vacate, modify, correct and confirm arbitration awards. Our discussion is limited to domestic awards falling solely under Chapter 1 of the Federal Arbitration Act and is not intended to be exhaustive. In a future Nuts & Bolts feature we will discuss the rules applicable to nondomestic awards falling under Chapters 2 and 3 of the Federal Arbitration Act. Our discussion is also limited to the rules that apply in federal courts within the United States Court of Appeals for the Second Circuit in diversity cases where the Federal Arbitration Act governs arbitration matters and New York law governs all other matters. The rules may be interpreted differently by other circuits and, even within the Second Circuit, outcomes may vary depending on which state’s law applies.
Limitation periods under the Federal Arbitration Act and New York’s arbitration statute are construed quite strictly and practitioners should carefully abide by them. Sometimes it is unclear whether a limitation period has accrued or been tolled. In that event practitioners should err on the side of caution. If there is a question whether the period for filing an application has accrued, assume that it has, and file and serve your papers within the shortest allotted period. If there is a question whether the period has been tolled, assume that it has not, and do whatever it takes to toll it. Continue Reading »
