Arbitration Awards: Understanding the Limitation of Vacatur and the Possibilities for an Appeal

Abstract

Few realize that an arbitrator's award is not always final. By right, whether applying the Federal Arbitration Act or individual state law, awards can be reviewed by courts to insure that the arbitrators actions were free of misconduct and within his or her authority. But a second avenue may exist, one that is rarely considered, some form of an appeal either to a court or to another arbitrator. No matter which type of appeal is deemed appropriate, it can only come about by agreement between the parties. There is no statutory right to an appeal. Each of these three routes have risks. In this article I discuss these risks and benefits within the context of the Federal Arbitration Act, the laws of New York and the rules of the major providers of arbitration services such as the American Arbitration Association, JAMS, CPR and National Arbitration Forum. The general principles discussed have application to the arbitration laws of all the states.

Keywords: arbitration awards, appeal, vacatur, Federal Arbitration Act, state law, New York CPLR Article 75

JEL Classification: K10, K12, K19, K40, K41, K49