ARBITRATION'S AWARD JUDICIAL REVIEW

Arbitration's Award Judicial Review



TABLE OF CONTENT

INTRODUCTION3

STATE AND FEDERAL ARBITRATION STATUTES4

JUDICIAL REVIEW OF ARBITRATION AWARDS8

HALL STREET ASSOCIATES, L. L. C. V. MATTEL, INC.14

ARBITRATION ACT 199619

JUDICAL REVIEW19

Anti-suit injunctions22

Arbitration and human rights24

CONCLUSION32

ENDNOTES35

Arbitration's Award Judicial Review

Introduction

Alternative Dispute Resolution (ADR) generally means arbitration or mediation. Mediation is a non-binding process where a neutral third-party intermediary attempts to bring the disputing parties together to resolve a dispute voluntarily. Arbitration, on the other hand, is a binding process where the third-party neutral has the authority to, after considering the parties' respective positions through an evidentiary proceeding, make decisions on the issues that the parties must accept. For the past decade or longer, ADR has been the darling of lawyers and clients, who seek alternatives to the prolonged and costly process of court litigation. This is reflected in the following facts: the number of disputes resolved by ADR has increased dramatically; traditional arbitration organizations have expanded the scope of their services to include mediation and other ADR activities; new arbitration organizations have been formed to compete with the traditional providers; and more and more lawyers are advertising their services as mediators and arbitrators. This article deals with a particular aspect of arbitration - the ability of parties to obtain judicial review of the decision of the arbitrator, in other words, an appeal.

State and Federal Arbitration Statutes

Each state and the Federal system have their own statutory arbitration scheme. The Federal Arbitration Act (FAA) can be found at 9 U.S.C.A. § 1. et seq. Many states, like Arizona, model their arbitration regimes on the Uniform Arbitration Act. Typically, the governing arbitration statutes restrict the right of appeal of an arbitration decision. The Arizona statute, following the Uniform Act, provides that a court can review an arbitrator's decision only in the following circumstances: where the award was procured by corruption, fraud or other undue means; evident partiality by a neutral arbitrator; where the arbitrator(s) exceeded his powers; where the arbitrator(s) conducted the hearing contrary to law or to the substantial prejudice of one of the parties; and where the adverse party contested the arbitration and did not participate in the proceeding. Applying these provisions, Arizona courts have consistently recognized the limited role of trial courts in reviewing the arbitration award.[iii] Under the FAA grounds for vacating an arbitration award include where the award was procured by "corruption," "fraud" or "undue means" and where the arbitrators were "guilty of misconduct" or "exceeded their powers." Grounds for modifying or correcting an award include "evident material miscalculation," "evident material mistake" and "imperfections in matter of form not affecting the merits."

It should be noted that neither the Uniform/Arizona Act nor the Federal Act provides an appeal in circumstances where one party believes that the arbitrator(s) erred with respect to factual findings or application of law. In fact, there are many court decisions from numerous jurisdictions, including Arizona, that uphold the rejection of appeals on those grounds.[v] And, many courts have gone so far as to say that there is no right ...