Relief from Arbitration Award Errors

Relief from Arbitration Award Errors

Relief from an arbitration award error refers to the legal remedies available to a party who believes that an arbitrator has made a mistake in their decision during the arbitration process. Arbitration is a method of resolving disputes outside of the courts, where an arbitrator makes a binding decision after hearing both sides.

In many jurisdictions, relief from an arbitration award can be sought under statutory provisions, such as the Federal Arbitration Act in the United States, or state arbitration laws. The grounds for seeking relief typically include:

1. Corruption, Fraud, or Undue Means: If it can be proven that the award was obtained through dishonest practices or improper influence.

2. Evident Partiality or Corruption in the Arbitrators: If the arbitrators exhibited bias or conflicts of interest that affected the fairness of the proceedings.

3. Misconduct of the Arbitrators: This may refer to situations where the arbitrators failed to provide a fair hearing, refused to hear pertinent evidence, or otherwise acted improperly.

4. Exceeding Powers: If the arbitrators made decisions that went beyond the scope of their authority or the issues presented for arbitration.

5. Failure to Make a Mutual, Final, and Definite Award: The award must resolve all aspects of the dispute; if it is ambiguous or incomplete, relief may be sought.

Relief can take several forms, including vacating (overturning) the arbitration award, modifying it, or remanding the matter back to the arbitration panel for further proceedings. It’s important to note that courts typically exhibit a high degree of deference to arbitration awards, often favoring finality in arbitration to encourage parties to resolve disputes outside of court.

For example, if a business arbitration results in an award that unfairly favors one party due to the arbitrator’s undisclosed financial interest in that party’s company, the disadvantaged party may file a motion for relief based on evident partiality. If successful, the court may vacate the award, allowing for a new arbitration hearing with a neutral arbitrator.