[CLC-Discussion] Arbitration award vacated for failure to follow the contract

[Larry Leiby]

We all know that there are only limited statutory grounds to vacate an arbitration award.  Based on Hall Street Assocs. v. Mattel, Inc., 128 S. Ct. 1396 (2008) and Frazier v. CitiFinancial Corp.  604 F.3d 1313 (11th Cir. 2010) it has been held that "manifest disregard of the law" is no longer a  basis for vacating an arbitration award.  Some other federal districts have receded from Hall Street, and recognize manifest disregard of the law as a basis to vacate an award.  Still others have allowed an award to be vacated where the arbitrator failed to follow the law, which requirement was in the agreement to arbitrate, as thereby exceeding the arbitrator's authority.

The "in vogue" basis to vacate an arbitration award for failure to follow the law (which is not itself a basis to vacate) is that the arbitrator exceeded his/her authority (which is a statutory basis for vacating an award).  If the award is made  that does not draw its  essence" from the contract the award may be in excess of the arbitrator's authority.

An interesting new case that upheld vacating an arbitration award where an employee was terminated for convenience, but the arbitrator awarded the employee salary as if the employee were wrongfully terminated, is attached.

The arbitrator exceeded his authority by making an award that was not drawn from the essence of the contract.  It looks like an award that does not conform to the contract is vacatable as the arbitrator exceeding his/her authority.

We lawyers and judges sure love working with the words.

Larry R. Leiby, Esq.

Fellow, College of Commercial Arbitrators
Member, Leiby Alexander Brandt ADR Group, LLC
Florida Supreme Court Certified Circuit Court Civil Mediator
National Academy of Distinguished Neutrals
International Mediation Institute Certified Mediator
Florida Bar Board Certified Construction Law Expert

JAMS Global Engineering and Construction Group
600 Brickell Avenue, Suite 2600
Miami, FL  33131

Phone: 954.895.9198
Fax:  305.371.5288
lleiby at jamsadr.com

[cid:image001.jpg at 01CF3A1C.DD0D5ED0]

-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://mailman.fsr.com/pipermail/clc-discussion/attachments/20140307/0fc18d29/attachment.html>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image001.jpg
Type: image/jpeg
Size: 3332 bytes
Desc: image001.jpg
URL: <http://mailman.fsr.com/pipermail/clc-discussion/attachments/20140307/0fc18d29/image001.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: Short v Resource Title Agency - exceed auth.pdf
Type: application/pdf
Size: 64020 bytes
Desc: Short v Resource Title Agency - exceed auth.pdf
URL: <http://mailman.fsr.com/pipermail/clc-discussion/attachments/20140307/0fc18d29/ShortvResourceTitleAgency-exceedauth.pdf>