Arbitration clauses in reinsurance contracts typically recognize either expressly or impliedly that an arbitration proceeding has a beginning and an end. The process usually begins with a demand for arbitration and the selection of an arbitration panel, and ends with the arbitrators holding a hearing on the merits and issuing a final award. At that point the parties generally expect that the arbitrators will step down, and that any future dispute will be the subject of a new arbitration proceeding, perhaps with a different panel. Continue Reading »
Archive for the ‘Practice and Procedure’ Category
Peter Scarpato Reports on the Association of Insurance & Reinsurance Run-Off Companies (AIRROC) Dispute Resolution Procedure for Small Claims
June 27th, 2009 Association of Insurance and Reinsurance Run-Off Companies (AIRROC), Practice and Procedure, Reinsurance Arbitration Comments Off on Peter Scarpato Reports on the Association of Insurance & Reinsurance Run-Off Companies (AIRROC) Dispute Resolution Procedure for Small ClaimsThe Spring 2009 issue of AIRROC Matters is out and available here:
http://www.airroc.org/files/AIRROC_Spring_2009.pdf.
Peter Scarpato (website here), Editor-in-Chief of AIRROC Matters, wrote an interesting article on AIRROC’s new Dispute Resolution Procedure for Small Claims. The procedure is designed to provide a cost-effective alternative to a full-blown reinsurance arbitration for resolving relatively small-dollar reinsurance disputes. Peter’s article, which is highly recommended, appears on page 9 of the newsletter. (Not too long ago, Peter submitted to the Forum an excellent guest post on mediation of reinsurance disputes, introduction to the post available here, and post available here.)
I sense on the part of many some dissatisfaction with certain aspects of reinsurance arbitration practice. One popular complaint is cost — not only the cost of legal services, but arbitrator fees. Tied into cost is time — most reinsurance attorneys and arbitrators charge by the hour, and reinsurance arbitrations can be as lenghty, or nearly as lengthy as court proceedings. In some cases, they are more lengthy.
When the amount at stake is tens or hundreds of millions of dollars, then the cost/value ratio may not be that high, but when the value of the claim goes down, the cost/value ratio tends to go up (even though the costs are lower from a dollars and cents perspective).
What AIRROC (website here) has done is devised an alternative procedure featuring expedited proceedings, a $150 per hour cap on arbitrator fees, and a single arbitrator. The procedure (which, of course, is voluntary) may well provide a useful alternative to a full-blown arbitration for claims whose dollar value is small enough to fall within its scope.
We’d be interested in what others think about the procedure. In addition, we’d be interested in hearing people’s thoughts on whether the procedure might provide a workable blueprint for other industry small-claims procedures.
Nuts & Bolts: Limitation Periods for Motions to Vacate, Modify, Correct and Confirm Domestic Arbitration Awards Falling Under Chapter 1 of the Federal Arbitration Act
May 1st, 2009 Awards, Nuts & Bolts, Nuts & Bolts: Arbitration, Practice and Procedure Comments Off on Nuts & Bolts: Limitation Periods for Motions to Vacate, Modify, Correct and Confirm Domestic Arbitration Awards Falling Under Chapter 1 of the Federal Arbitration ActIntroduction
Today we briefly review the limitation periods applicable to motions 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 non-domestic 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, among other things, which state’s law applies.
Limitation periods for motions to vacate or for other forms of relief 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 »
