Arbitration is supposed to be a simple, informal, speedy and confidential alternative to litigation. Sometimes arbitration can be just that, particularly when the arbitrators do their jobs well and the parties at all times act in good faith. In some specialized industries, the perceived advantages of arbitration over litigation include, among others, the ability of arbitration to enforce industry norms and customs in ways that courts cannot or will not.
But arbitration law—and the arbitration award enforcement litigation required to implement it—is much more complex and nuanced than one would expect it to be. A person attempting to convince a court to vacate an arbitration award—even one that seems to be an exceptionally good candidate for vacatur—faces a daunting task when it comes to attempting to convince a court that it should grant relief.
A person who has obtained a favorable award that might be a decent candidate for vacatur also faces a challenging task when it comes to defending the award against attack. While the odds of success ordinarily favor the award-defending party, defending the award against a skilled attack by lawyers with experience in arbitration law can be difficult and expensive, even if it is ultimately successful.
Parties who are: (a) involved, or about to become involved, in arbitration award enforcement litigation; or (b) have reason to know there is a meaningful risk that they may need to commence or defend potentially contentious arbitration award enforcement litigation need all the help they can get, especially when the stakes are relatively high. As is true in other complex and challenging areas of the law, their interests are most likely to be best served by hiring skilled attorneys that have substantial experience handling arbitration-law-related matters. That is so even where a party’s chances of success are fairly high (as they typically (but not always) are when a party asks a court to confirm an award), because, all else equal, a reasonably-priced skilled and experienced attorney is, among other things, more likely to handle the matter on a more cost-effective basis than one who is low priced, but lacking skill and experience.
A skilled and experienced arbitration lawyer may be able to help, and persons facing the prospect of arbitration award enforcement should seriously consider whether their interests would be best served by hiring one. An arbitration lawyer can assess their chances of prevailing; handle any post-award proceedings as lead counsel, or assist with them by acting as advisory counsel to, or co-counsel with, the counsel who handled (or is handling) the arbitration proceedings (“counsel of record”).
In many cases, it may be advisable and cost-effective to retain an arbitration lawyer for purposes of monitoring the arbitration proceedings and assisting counsel of record with arbitration-law-related issues. That helps ensure that the arbitration record is adequately preserved in the event it turns out there are grounds to challenge an adverse award, and that the arguments are presented to the arbitrators in a way that is designed to: (a) decrease (where reasonably possible) the chances that a favorable award will be subject to a meaningful post-award challenge; and (b) increase (where reasonably possible) the chances that an adverse award can be meaningfully challenged if it turns out that there are grounds on which to mount such a challenge. And even if it turns out that a party’s chances of obtaining relief from an adverse award are very slim to none, the arbitration lawyer may, depending on the circumstances, be able to suggest ways to attempt to mitigate the severity of the adverse consequences that the award may have.
If you are a person who might benefit from the assistance of a skilled and experienced arbitration lawyer who works well with clients and co-counsel, then contact Philip J. Loree Jr., the partner principally responsible for our arbitration law practice to schedule a brief, free telephone consultation. (Mr. Loree may be reached at (516) 627-1720 or PJL1@LoreeLawFirm.com.)
Loree & Loree offers big-firm skill and experience at small-firm rates, which are designed to make it reasonably cost-effective for you to engage us to work together with counsel of record in an effort to solve your arbitration-award-related problems.
Who are Loree & Loree?
Loree & Loree (“L&L”) is a two-partner boutique law practice that focuses on arbitration law and commercial litigation and arbitration (including reinsurance- and insurance-related matters and other types of business and commercial disputes). L&L represents both business entities and persons acting in their individual or representative capacities, and frequently acts as co-counsel, local counsel or legal adviser to other domestic and international law firms requiring assistance or support. Our main website is here.
Philip J. Loree Jr., a former litigation partner at two leading New York City law firms, is principally responsible for L&L’s arbitration law practice. He has, among other things, nearly 25 years of experience handling appellate and trial-court litigation governed by the Federal Arbitration Act (the “FAA”) or state arbitration statutes, including matters falling under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”). He has represented clients in numerous complex arbitrations and trial- and appellate-court arbitration-enforcement-related proceedings, including high-profile matters; has written over one-hundred articles on arbitration-law-related matters; enjoys speaking about arbitration and other topics at professional conference; has been cited by law professors and others in academic law journal publications and has been quoted by the trade press. You can read more about his background and qualifications here.
Philip J. Loree Sr. has over fifty-years of experience practicing maritime, labor, and corporate law, and was for many years one of the leading U.S. spokespersons for the maritime industry. He too has extensive experience in arbitration, including labor arbitration arising under Section 301 of the Taft-Hartley Act (a/k/a the “Labor Management Relations Act” or “LMRA”), 29 U.S.C. § 185. You can read more about his background and qualifications here.
How do I use this Website?
There are any number of ways, but we’ve divided it into three “Gateways” or portals. Links to each one can be found just below the header, or you can use the navigation menus in the header and in the footer.
The first “Gateway” is a page with links to various pages covering topics pertinent to arbitration law in general and the Federal Arbitration Act in particular.
The second “Gateway” page is to a page with links to pages covering topics pertinent to Federal Arbitration Act arbitration-award litigation, that is, confirming, vacating, modifying and correcting arbitration awards. Some of the pages covering the grounds for vacating awards include links to additional, subpages covering subtopics pertinent to certain grounds for vacatur under the Federal Arbitration Act. (While confirming arbitration awards is a fairly straightforward topic, vacatur is considerably more complex and challenging, so we give it the extra attention that it deserves.)
The third “Gateway” page is to information about Loree & Loree’s practice and its partners, Philip J. Loree Jr. and Philip J. Loree Sr.
Even apart from the Gateway pages, however, what follows below on this page is a nice introduction to arbitration award enforcement litigation, which also contains links to some of the pages you can access via the “Gateway” pages.
Is Arbitration Award Enforcement Litigation Limited to Applications or Petitions to Confirm Arbitration Awards?
No. Arbitration enforcement litigation includes applications, petitions and motions to confirm, vacate, modify or correct arbitration awards.
The term arbitration award enforcement litigation may seem to refer only to litigation where the plaintiff or petitioner is asking the court to impose the terms of the award on the party who lost the arbitration, without regard to whether there may be grounds on which the other party may challenge the award. But, from a legal standpoint, “enforcement” of an arbitration award has a broader meaning.
Senior Judge Ralph K. Winter of the U.S. Court of Appeals for the Second Circuit explained that “enforcement” of an award includes not simply confirmation of an award, but the process of giving the award the legal effect to which it is entitled, even if that means vacating the award in whole or in part:
To enforce is ‘[t]o give force or effect to.’ Black’s Law Dictionary (8th ed.2004). Because arbitration awards are not self-enforcing, they must be given force and effect by being converted to judicial orders by courts; these orders can confirm and/or vacate the award, either in whole or in part. Here, Broker petitioned the court to confirm in part and vacate in part the arbitration award. That request simply sought to give effect to the arbitration award. The partial vacatur of the award sought by Broker does not alter the nature of the action, which we believe is properly considered to involve ‘enforcing’ the arbitration award.
D.H. Blair & Co., Inc. v. Gottdiener, 462 F.3d 95, 104 (2006) (quotation and citation omitted).
Consistent with Gottdiener, we use the term “enforce,” as applied to an arbitration award, to mean to give the award the legal effect to which it is entitled in the circumstances, whether or not that means confirming, vacating, modifying or correcting the award in whole or in part.
What is Arbitration Law. . . and What is the Federal Arbitration Act?
Arbitration law is the body of law governing the enforcement of arbitration agreements. It is designed to ensure that courts will enforce arbitration agreements, whether that means confirming, vacating, modifying or correcting an award; compelling arbitration; staying litigation, or what have you.
The Federal Arbitration Act, 9 U.S.C. §§ 1, et. seq. (a/k/a the “FAA”), is a federal statute that creates federal substantive law, applicable in both state and federal court, which requires courts to enforce arbitration agreements. It also establishes federal procedural law that federal courts apply in litigation concerning the enforcement of arbitration agreements and awards.
Chapter 1 of The Federal Arbitration Act does not, however, create federal court subject matter jurisdiction over cases and controversies involving arbitration agreements falling within Chapter 1’s scope but not within that of treaties implemented by Chapters 2 and 3. Rather the federal court must have an independent basis for subject matter jurisdiction, which typically is based on diversity of citizenship.
The first 15 sections of the Federal Arbitration Act were enacted in 1925, and have been on the books since then, without material revision. Each of these sections is part of what is now known as Chapter 1 of the FAA.
Can I Challenge an Arbitration Award in Court?
The Federal Arbitration Act authorizes Courts to vacate, modify or correct arbitration awards in certain circumstances, but those circumstances are fairly limited and narrow in scope. An order vacating an award, however, may be appropriate if the arbitrator or a party materially violates the express terms of the arbitration agreement or the very modest reasonable expectations of fairness that the Section 10 of the Federal Arbitration Act implies into every arbitration agreement. The basics of challenging arbitration agreements in court under the Federal Arbitration Act are outlined here.
While the FAA ordinarily requires courts to confirm arbitration awards, an award that is “fundamentally at war” with the parties’ agreement must be vacated, for confirming such an award would be the functional equivalent of not enforcing the parties’ agreement—the very antithesis of what the FAA commands. See, e.g., Stolt-Nielsen, S.A. v. AnimalFeeds Int’l Corp., 559 U.S. 662, 668, 672-73, 681-82 (2010).
I Obtained an Award in my Favor but my Adversary will not Pay it.
What can I do?
Favorable arbitration awards are wonderful things but they do not enforce themselves. The Federal Arbitration Act authorizes courts to confirm arbitration awards, that is, enter judgment on them. Once a judgment is entered upon an award then it can be coercively enforced in various ways. Read about the FAA’s confirmation process here.
Do we Offer any Other Arbitration Law Resources?
In addition to the information provided in the webpages of this site, you can find other information concerning the enforcement of arbitration awards in our main blog, the Loree Reinsurance and Arbitration Law Forum, which we launched in March 2009; the Arbitration Award Practice Blog, which is part of this site and the Federal Arbitration Act Litigation Procedure Blog, which is part of our Federal Arbitration Act Litigation Website. You can read about and access all three arbitration law blogs here.
How do I Contact Loree & Loree?
Our contact information is here.
If you are an individual, a business owner, an in-house attorney or another authorized representative of a business entity, and you or the entity you represent believe you need to engage counsel to assist with an arbitration-law-related matter, or with some other arbitration or commercial-litigation matter, then we encourage you to contact us at (516) 627-1720, or email@example.com, to schedule a mutually convenient time for a brief, free telephone consultation.
Finally, if you have an issue concerning an arbitration award, or some other matter, we urge you to contact a lawyer as quickly as possible, irrespective of whether you decide to contact us. There are, for example, very short and strict deadlines that apply to award challenges, and even a motion to confirm is generally subject to a one-year statute of limitations under the Federal Arbitration Act. If you’ve already been served with papers, then you need to speak to a lawyer right away because you’ll need to file a fully supported, comprehensive response or cross-motion within the period permitted by applicable procedural rules. Indeed, even outside the arbitration law context, legal matters tend to be time sensitive, and you could lose valuable rights by not seeking legal assistance in a timely fashion. So if you have or think you have a legal problem, then, by all means, consult with an attorney without delay.
Loree & Loree