2023
Ninth Circuit Holds Last-Leg Drivers Exempt from FAA
By Drake A. Mirsch and Claudia Coleman – August 10, 2023
The court found that in-state delivery drivers who delivered out-of-state products from a California warehouse to franchise locations within California were exempt from the FAA.
What Are the Practical Implications of California Supreme Court’s Recent PAGA Ruling?
By Julie Westcott O’Dell and Drake A. Mirsch – July 24, 2023
Employers will need to assess the merits of a plaintiff’s PAGA standing quite early when faced with a new PAGA action brought by an employee with a valid arbitration agreement.
Supreme Court Once Again Issues a Pro-Arbitration Ruling
By Stuart M. Riback – July 10, 2023
If a contract contains an arbitration clause—even a very narrow, limited one—a defendant intent on delaying matters will now have an incentive to argue that the clause applies and to appeal any adverse ruling.
Waiving Right to Court and Jury by Sophisticated Commercial Parties
By Robert Bartkus – April 14, 2023
A New Jersey court decision eliminates one defense to motions to compel arbitration involving sophisticated parties—a development that will make commercial arbitration more predictable, more expeditious, and less expensive.
Circuit Rejects Functus Officio Argument, Permits Arbitrator to Add Reasons to Award
By Mark Kantor – March 23, 2023
This opinion is useful for its explanations of why the doctrine did not prevent the remand and why remand was appropriate rather than vacatur of the award.
Expanding the Grounds for Vacating an Arbitration Award
By Robert E. Bartkus – March 15, 2023
Contract language alone will not override the dictates of section 10(a) of the FAA, but it remains unclear whether parties may still agree to expand the judicial review of awards when the parties have not contractually adopted the FAA.
Interim Award for Security Is “Final” Enough to Be Confirmed
By Michael Desnick – March 8, 2023
Although such relief is equitable in nature, it is different from specific performance and is designed to preserve assets until the arbitration can be decided.
Florida Passes Law to Encourage Arbitration of Property Insurance Claims
By Robert P. Wax – February 14, 2023
Will this encouragement of arbitration set an example for the rest of the nation?
Manifest Disregard Requires Specific Intent
By Andrew Simms – February 6, 2023
The Georgia Supreme Court held that in order to disregard the law, an arbitrator has to know the law and intentionally disregard it, not simply make a legal error.
Dispute Outside Terms of the Arbitration Agreement
By Matthew Buckley – January 26, 2023
An attorney acting as an escrow agent should note that an arbitration clause in the escrow agreement may not cover all facets of his or her relationship with the parties.
Fifth Circuit Holds that Post-Award Review Encompasses Entire Record
By Mark Kantor – January 13, 2023
In circumstances where the petitioner did not contest particular facts, it is appropriate to give deference to the arbitrator's findings of fact.
2022
Arbitration Required Despite Party’s Right to Seek Injunctive Relief in Court
By Joseph Raymond – December 23, 2022
Illinois federal court held that clauses permitting injunctive relief do not limit an arbitrator’s authority to decide arbitrability when parties have agreed to delegate such questions to the arbitrator.
Federal Court Upholds Arbitration Agreement Despite Broken Link
By Blake Edmonson – December 14, 2022
The fact that a link to online arbitration terms does not work will not necessarily provide a defense to a party seeking to avoid arbitration.
Does the Arbitrator Decide Arbitrability?
By Benjamin Dockery – December 7, 2022
Reference to the California Code of Civil Procedure delegates arbitrability to the arbitrator in international commercial disputes.
State or Federal—Which Arbitration Act Governs an Agreement?
By Vincent Olmos – November 22, 2022
Federal court holds that a general choice of law provision does not displace the FAA in favor of state law.
Arbitrator Did Not Exceed Powers
By Cort Patrick – November 18, 2022
The Texas appellate court affirmed the arbitrator had not exceeded his powers in determining an agreement’s time limit enforceable and applying it.
Arbitration Agreement Can Prevent Joint Claim
By Dana Durham – November 3, 2022
New York district court found different paths to relief for two employees that filed a racial discrimination claim against their employer.
Unconscionability Challenges: Enforceability vs. Formation
By Christopher S. Moore – October 27, 2022
The court ruled that the plaintiffs’ unconscionability challenges went to enforceability, not formation, and thus must be decided in the first instance by the arbitrator.
New York Convention Does Not Preclude Non-Signatory from Compelling Arbitration
By Laura Benczak – October 20, 2022
A contracting party may wish to define to whom the arbitration clause does and does not apply in order to prevent persons named in or associated with the contract from invoking the right to arbitrate.
Ninth Circuit Defers to Delegation Clause
By Sophia Archos – October 5, 2022
Where there is a valid delegation clause within an arbitration provision, it is the arbitrator’s role to determine whether a statute precludes arbitration.
Quebec Court Applies 10-Year Limitations Period to Foreign Arbitral Awards
By Jonathan Eades – September 21, 2022
Attorneys seeking to enforce an arbitration award in Canada need to pay attention to the limitations period of the territory in which the application for enforcement is made.
Non-Signatory May Be Stuck With Award
By Robert Arrington – September 16, 2022
The court decided that a non-signatory may be bound by an agreement to arbitrate if it consents to arbitrate without reserving rights.
Ninth Circuit Enforces Arbitral Subpoena
By Mark Kantor – August 24, 2022
This decision approves a method for parties in an arbitration to obtain information from third persons.
Nursing Home Arbitration Provision Fails Again
By Robert Arrington – August 18, 2022
If the owners of care facilities wish to enforce arbitration clauses, they need to make the arbitration agreements more visible and train intake personnel on how to explain them.
Party Whose Lawyer Changed Sides Waived Right to Seek Vacatur
By Deborah A. Coleman – August 10, 2022
Some of the cases collected in the restatement comment hold that an arbitrator does not have the power to disqualify counsel.
NJ Supreme Court Clarifies Arbitration Right Under Direct Action Statute
By Robert E. Bartkus – August 3, 2022
A condominium association obtained default judgments against defunct construction companies, sought to collect those judgments against the defendants’ insurance company, but did not want to honor the arbitration clause in the policy of insurance.
Delegation Clause Enforced
By Robert Arrington – July 27, 2022
The Sixth Court reasoned all issues of arbitrability, including whether the provision may be enforced by a third party, must be decided by the arbitrator rather than the trial court.
Supreme Court Eradicates Another Obstacle to Arbitration
By Anthony Michael Sabino – July 13, 2022
The Supreme Court declares yet another California state law preempted by the FAA but sets the stage for potential future controversy in Viking River Cruises, Inc. v. Moriana.
Supreme Court Holds that Ramp Supervisor Is Exempt from FAA
By Mark Kantor – June 29, 2022
The Court’s effort to avoid ruling broadly leaves considerable opportunity for continuing litigation over the scope of the section 1 exemption.
Québec Law—Court Extends Arbitrator’s Immunity to Appointing Authority
By Marie-Claude Martel – June 23, 2022
The court reaffirmed that the arbitrator’s protection against prosecution is broad and applies both to the arbitrator’s liability and to any challenges against the conduct of the arbitration process itself.
FAA’s Policy Doesn’t Authorize Special Rules
By Jay Zhang and Scott D. Marrs – June 7, 2022
Morgan v. Sundance—clawing back federal policy of favoring arbitration by eliminating prejudice requirement in waiver analysis.
Accentuate the Positive
By Mark Heley – May 24, 2022
While negative comments on consumer or workplace arbitration seem to get shared, positive aspects of arbitration somehow miss the spotlight.
Postmates and the Enforcement of Arbitration Agreements
By Anthony Michael Sabino – May 12, 2022
Awaiting review may be the next Supreme Court decision upholding the strong federal policy favoring arbitration and preempting state laws that purport to void arbitral accords.
Sixth Circuit Recognizes Clarification-Completion Exception to Doctrine of Functus Officio
By Robert L. Arrington – May 4, 2022 | Follow the arbitration agreement assiduously. If it requires a reasoned award, a reasoned award must be supplied.
Supreme Court Rejects “Look-Through” Jurisdiction
By Mark Kantor – April 14, 2022
The Court held that the “look-through” approach does not apply to requests to confirm or vacate awards under sections 9 and 10.
Some Considerations for Plaintiff’s Counsel on the Joint Mediation Session
By Frederick Alimonti – April 6, 2022
A few points to help you evaluate the possible benefits of the opening session for the plaintiff’s team.
Arbitrator Misconduct and Counsel’s Hobson’s Choice
By W. H. Levit, Jr. – March 17, 2022
The best course is to raise arbitrator misbehavior during the hearing so remedial action can be taken by the offending arbitrator.
It’s Not Cricket: Ontario Court Emphasizes Arbitral Awards Must Include Reasons
By Eric Morgan – March 10, 2022
Providing reasons shows the parties that the arbitrator has heard and considered their arguments and that the arbitrator understood the substance of the dispute and addressed the critical issues.
McKenzie v. Brannan: A Never-Ending Love Story
By David L. Evans – February 23, 2022
When crafting a term sheet that memorializes an agreement reached during a mediation, the parties need to focus on what happens if they fail to agree upon a formal written settlement agreement.
Congress Passes Anti-Arbitration Act for Sexual Harassment Cases
By Mark Kantor – February 16, 2022
This bill does not seek to regulate NDA’s, only pre-dispute arbitration agreements and waivers of joint proceedings.
U.S. Supreme Court Oral Argument Schedule for Arbitration-Related Cases
By Mark Kantor – February 2, 2022
A rundown of the Court’s March oral arguments calendar, focusing on dates that will cover arbitration disputes.
Supreme Court to Hear Yet Another Arbitration Case
By Mark Kantor – January 19, 2022
Does the FAA require enforcement of a bilateral arbitration agreement providing that an employee cannot raise representative claims, including under the PAGA?
Can Judges (or Arbitrators) be Compelled to Give Evidence on a Bias Challenge?
By Joanne Luu – January 13, 2022
There are strong arguments against the ability to compel an arbitrator to give evidence relating to an application to disqualify the arbitrator based on alleged bias.
Delegation Clause Impacts Class Action
By Robert Arrington – January 5, 2022
The question of whether the plaintiffs were obliged to arbitrate their claims fell within the terms of the delegation clause and was left to the arbitrator to decide.
2021
Proposed Federal Statute on the Arbitration of Sexual Harassment Claims
By Mark Kantor – December 16, 2021
The Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act has attracted a lot of support from both parties compared to other bills providing for restrictions on pre-dispute arbitration agreements and appears to have a fair chance of passing.
Supreme Court to Hear Whether Prejudice Is Required to Waive Arbitration
By Mark Kantor – December 3, 2021
This dispute involves the question of whether one party arguing that a second party has waived its right to arbitration must show prejudice resulting from the second party’s delay in asserting the right to arbitrate the dispute.
Value Claiming in Mediation: Managing the Offers and Demands
By Joan Stearns Johnsen – November 17, 2021
Careful attention to the initial opens, patterns of concession, and pacing will help you and your client achieve success in your mediations.
New Rules for Disputes Involving Online Marketplaces and Individuals
By P. Jean Baker – November 10, 2021
The American Arbitration Association has established a new procedure for disputes involving online marketplaces and platforms versus individual users and subscribers.
B.C. Arbitrator’s Award Set Aside as “Arbitrary and Irrational”
By Lisa C. Munro – October 28, 2021
The arbitrator’s reasons were found to be inadequate for the parties to understand the rationale for the decision.
Court Declines to Extend Monster Energy
By Mark Kantor – October 6, 2021
In a separate case, all three members of the appellate panel for the U.S. Court of Appeals for the Ninth Circuit joined in a separate concurrence urging the Ninth Circuit to revisit Monster Energy.
SDNY Prohibits Remote Testimony for Arbitration Subpoena Compliance
By Rebecca Lunceford Kolb – September 29, 2021
While the decision may prove a bellwether in prohibiting remote testimony for arbitral subpoenas, such an approach does push against the general trend of embracing virtual technology.
California and the Ninth Circuit Strike Again
By Mitchell L. Marinello – September 22, 2021
California does not want employers to require employees to sign arbitration agreements, and the Ninth Circuit continues to support that position, regardless of what the FAA or the Supreme Court have to say about it.
CA Court Holds the FAA Trumps Rule of Contract Construction
By Joel Levine – September 16, 2021
After a trial court found an inconsistency between the Spanish and English versions of the arbitration agreement, the court of appeals reversed and directed the parties to binding arbitration.
Badgerow’s Petition for Certiorari Granted by Supreme Court
By Mark Kantor – September 8, 2021
Do federal courts have subject-matter jurisdiction to confirm or vacate an arbitration award under sections 9 and 10 of the FAA when the only basis for jurisdiction is that the underlying dispute involved a federal question?
Interim Award Deemed Sufficiently Final and Confirmed
By Jazmine Phillips-Acie – August 18, 2021
This decision is an important reminder of the kind of relief that may be available from such an emergency arbitrator and that such relief can be confirmed in court.
D.C. Circuit Affirms Online Terms of Service Are Binding
By Joel Levine – August 11, 2021
The appellate opinion enforces an arbitration clause despite differences in language translation.
Sixth Circuit Rejects Application of AAA Healthcare Policy
By Mark Kantor – August 4, 2021
This ruling has significant implications for many disputes involving healthcare, consumer, and employment matters.
CA Supreme Court Judicial Ethics Committee Issues Opinion on Social Media Posts
By Mitchell Marinello – July 29, 2021
Being careful when posting material on social media is important for arbitrators as well as judges because arbitrators, like judges, issue binding decisions that can be challenged for bias or other cause based on what the arbitrator has written.
Fox News Agrees to Forgo Mandatory Arbitration in NYC HRC Settlement
By Mark Kantor – July 7, 2021
This agreement shows that the opposition to mandatory arbitration of sexual harassment claims and other allegations of abuse towards employees is a mainstream concern.
CPR Issues New Employment Rules and Updates Mass Claims Protocol
By Mitchell L. Marinello – June 25, 2021
The new employment rules directly incorporate CPR’s Due Process Protections and also include distinguishing characteristics such as granting authority to the arbitrator to hold remote hearing and more.
Second Circuit Affirms Confirmation of ICC Award Based on UAE’s Obligation of Good Faith
By Brendan N. Gooley – June 18, 2021
The court noted that a barely colorable justification was all that was needed for an award to be enforced against a challenge that an arbitrator manifestly disregarded the law.
Georgia Examines Enforceability of Arbitration Agreements in Smartphone Apps
By Jake Carroll – June 9, 2021
The more factors met regarding how easy it is to see and read an app’s terms and conditions, the less risk that a hyperlinked arbitration clause will be found unenforceable.
Pre-Hearing Virtual Deposition Subpoena to Nonparty Upheld
By Dana Taylor – June 2, 2021
This case not only expanded an arbitrator’s powers but also departed from many other circuits finding pre-hearing deposition or discovery subpoenas invalid.
Will Georgia’s “Manifest Disregard” Standard Be Narrowed Further?
By Scott Zucker – May 26, 2021
Although several decisions have narrowed the meaning of “manifest disregard” and how it should be applied, there is still concern that the standard is being applied too broadly.
British Columbia Allows Recovery of Legal Fees in Arbitration
By Daniel Urbas – May 12, 2021
A Canadian court has held that the recovery of legal fees is not only a feature of British Columbia’s arbitration statute, but a positive trait of arbitration.
Federal Court Denies Injunction Against Zoom Hearing
By Mitchell Marinello – April 30, 2021
Preemptory challenges to an arbitrator’s procedural decisions are unlikely to succeed, and remote hearings are here to stay.
Congress Continues to Debate the Proper Role of Arbitration
By Mark Kantor – April 22, 2021
If passed, the FAIR Act would ban mandatory pre-dispute arbitration agreements in cases of employment, consumer, class antitrust, and civil rights disputes, as well as pre-dispute joint-action waivers for those disputes in any forum.
Winning at Mediation!
By Joan Stearns Johnsen – April 14, 2021
Focusing on beating your adversary and “winning the mediation” rather than obtaining the best result for your client ignores the nature of negotiation—agreement is voluntary.
Canadian Court Decides NY Convention’s Requirement Is Inclusive
By Daniel Urbas – March 31, 2021
The court held that the requirement of a written arbitration agreement includes emails and texts.
Québec Court Enforces Ex Parte Award Stemming from Email Notice
By Daniel Urbas – March 22, 2021
Parties can confidently obtain a fair, prompt, enforceable resolution by nominating an experienced arbitrator, involving an established administering institution, and appearing before a court supportive of arbitration.
Opening Statements in Mediation
By Joan Stearns Johnsen – February 24, 2021
The objective of a mediation opening statement is not about the truth of what happened, but the risks of litigation.
Monster Strikes Again
By Mark Kantor – February 18, 2021
Much has been written in the literature about conflicts issues for arbitrators. Much less has been written, or even discussed, regarding the ethics responsibilities of arbitral institutions themselves.
Supreme Court Denies Cert re Competence-Competence Provision
By Mark Kantor – February 10, 2021
It was yet another case where the Court held such a provision is a clear and unmistakable standard for determining if the parties had allocated who decides authority over arbitrability issues to the arbitrator.
Federal Court Confirms Emergency Arbitrator’s Interim Injunction
By Mark Kantor and Mitchell Marinello – February 3, 2021
An arbitration agreement that authorizes parties to seek interim relief from a judicial forum does not prevent an arbitral panel or an emergency arbitrator from granting that relief.
An Arbitration Solution to Surprise Medical Billings
By Mark Kantor – January 20, 2021
The solution is a compromise proposed by a bipartisan group of Congressional legislators that involves both a binding quasi-arbitration process and comparisons with “in-network” payment rates.
Monster and Olympic: Still in a JAM?
By Mitchell L. Marinello – January 13, 2021
After learning of a conflict of interest between JAMS and Monster, Olympic Eagle has sought an order compelling the arbitration to be held before a neutral provider other than JAMS.
The Power to Pursue or Disclaim Agreements
By Daniel Urbas – January 6, 2021
Canadian doctrine of separability allows receiver to disclaim arbitration agreement while suing on main contract.
2020
Arbitrators, Litigants, and Companies Beware: Overbroad NDA May Violate Statutory Rights
By Dana Welch – December 29, 2020
Companies should examine their employee confidentiality agreements to ensure they do not run afoul of any state statute, and litigants in trade secret disputes should note that the scope of the agreements will be fertile ground for challenge.
Supreme Court to Decide Important Arbitration Case
By Stuart M. Riback – December 7, 2020
What happens when an arbitration clause has a carve-out, and who should decide whether a dispute is within the carve-out—a court or an arbitrator?
Aftermath of the Election as a Lesson for Mediators and Negotiators
By John Bickerman – December 2, 2020
Winning and losing is often in the eyes of the beholder.
Confidentiality and Its Exceptions in Mediation
By Stuart Widman – November 24, 2020
Courts must take the smallest bites possible out of the confidentiality shield when a carve-out is warranted.
NJ Supreme Court Returns to Basics—FAA Section 5 and NJRUAA Section 11
By Robert E. Bartkus – November 18, 2020
The Federal Arbitration Act and the New Jersey’s Revised Uniform Arbitration Act give the court authority to appoint an arbitrator when the parties have failed to and their agreement does not specify a method for appointment.
Illinois Federal District Court Confirms FINRA Award
By Mitchell L. Marinello – November 10, 2020
Illinois attorneys have wondered if the outcome of a motion to confirm an award might depend on whether the FAA or the IL UAA were applied. This decision provides some authority that the outcome should be the same under either statute.
Negotiation Advice: Who Should Open?
By Joan Stearns Johnsen – November 4, 2020
The open is an important aspect of any negotiation, and it is wise to spend preparation time analyzing and considering your own preferred strategy as well as that of your adversary.
Federal Court Jurisdiction over FAA Confirmation Motions
By Robert Bartkus – October 30, 2020
The Third Circuit held that an application to confirm an arbitration award does not require a separate showing of a “present” case or controversy as would be required for a federal complaint.
WBO Boxers vs. NFL Players: Different Arbitrator Bias Rules
By Mark Kantor – October 21, 2020
Opposing decisions raise the question of whether LMRDA collective bargaining agreement arbitrations operate under different bias rules than FAA arbitrations despite the “evident partiality” vacatur provisions of the FAA.
New Jersey Supreme Court Reaffirms Electronic Notice and Acceptance by Performance
By Robert Bartkus – October 7, 2020
The decision gives employers clearer guidance regarding distributing an arbitration program and the means of obtaining employees’ assent.
Sixth Circuit Joins the Crowd: Under AAA Rules, Arbitrators Decide Arbitrability
By Mark Kantor – September 23, 2020
It noted that eleven of the twelve circuits had reached the same result and concluded that “[t]here’s little doubt about the final picture.”
California Federal Court Enjoins Ohio Arbitration
By Michael Ferrara – September 17, 2020
Although plaintiffs won the case primarily because of collateral estoppel, the court took time to emphasize that the arbitration and forum selection clauses would be ineffective regardless.
Employment Award Vacated for Manifest Disregard of the Law
By Mitchell Marinello and Mark Kantor – September 9, 2020
The court’s central point was the arbitrator chose to ignore that applicable North Carolina law does not recognize the cause of action for which the arbitrator granted relief.
New Jersey Supreme Court Decides FAA Section One Issue
By Robert E. Bartkus – September 2, 2020
Finding that section 1 might exempt a worker meant the parties should proceed as if the FAA had never existed.
New York State Court Dismisses Arbitration Award as Moot
By Mariah Whitner – August 26, 2020
The court ruled the arbitrator overstepped his authority by requiring a school board to adhere to rules not set forth in the party’s collective bargaining agreement.
FAA’s “Residual Clause” Does Not Exempt Grubhub Drivers from Arbitration
By Christopher S. Moore – August 19, 2020
According to the court, for plaintiffs to fall within the residuary clause, they had to demonstrate that the interstate movement of goods was a central part of their job description.
District Court Distinguishes the Monster Decision
By Mark Kantor – August 12, 2020
The court decision in Levi Strauss v. Aqua offers insight into the meaning of the “repeat player” aspect of the Ninth Circuit Court of Appeals decision in Monster Energy.
When Is an Arbitration a Foreign or International Tribunal?
By Alex Silverman – August 5, 2020
Second Circuit affirms Chinese arbitration organization is not a “foreign or international tribunal” under section 1782.
Do “Make Whole” Arbitration Awards Allow Offsets?
By Daniel Carr – July 22, 2020
A court determined the language “make whole for lost wages and benefits” in an arbitration award was not too ambiguous to be enforced and thus the employer could not offset any outside income an employee had earned when it paid him for lost wages.
Motion to Vacate Award Sanctioned
By Mark Kantor – July 15, 2020
The U.S. District Court for the Northern District of Alabama ruled that an award of sanctions was appropriate to "protect arbitration as a remedy."
Court Defers to Arbitrator’s Interpretation of Contract and Law
By Florence Montarmani – June 24, 2020
This decision demonstrates the value of a reasoned award that permits a reviewing court to understand the basis for the arbitrator’s decision.
Court Denies Arbitration of Nursing Home Wrongful Death and Survival Claims
By Tony Shapiro – June 17, 2020
An Illinois appellate affirmed the denial due to the decedent’s lack of mental capacity.
California Federal Court Considers WARN Act Claim Against Uber
By Haley Mulherin – June 10, 2020
This case reaffirms the principle that the courts must treat arbitration agreements on an equal footing with other contracts and enforce them according to their terms.
Non-Signatory Can Use Equitable Estoppel to Compel Arbitration
By Mark Kantor – June 3, 2020
The U.S. Supreme Court help that the New York Convention does not require arbitration agreements to be signed by the disputing parties.
Consumer Arbitration Clause Must Be Clear
By Sadaf Ahmed – May 27, 2020
In New Jersey, arbitration agreements must be clearly worded and demonstrate the consumer fully understands the implications of the agreement.
Cost-Shifting Provisions May Not Make Agreement Unconscionable
By Leah Lewis – May 13, 2020
Many factors can affect the assessment of unconscionability and such a defense needs to be evaluated on a case-by-case basis.
NLRB Returns to Arbitration-Friendly Standard
By John R. Graham – May 7, 2020
The NLRB returned to its traditional standard for deciding whether to defer to an arbitrator’s prior resolution of a grievance concerning an employee’s discipline or discharge that has been alleged to violate the NLRA.
Dispute Not Covered by Arbitration Agreement
By Vanessa Kamberis – April 29, 2020
Although courts generally favor arbitration, they will not compel the arbitration of claims that are outside the scope of the parties’ agreement.
Fifth Circuit Denies Vacatur
By Ben Katchur – April 22, 2020
Vacatur of an arbitration award is rare, and although reconsideration of an award is generally not allowed, the parties may agree to arbitration rules that permit it.
Canadian Courts Employ Virtual Hearings
By Daniel Urbas – April 15, 2020
On April 17, 2020, a Canadian court will hold a hearing using Zoom technology organized through Arbitration Place.
Employees with Arbitration Agreements Not Entitled to Notice of Class Action
By Sherod Craig – April 8, 2020
A win for employers seeking to enforce mutual arbitration agreements.
Fourth Circuit Remands Question of Contract Formation for Trial
By Serhiy Kiyasov – March 30, 2020
Where the facts of contract formation are disputed, a trial may be necessary.
Resolving IP Disputes—The Common-Interest Privilege and the Use of Settlement Counsel
By Kirk Dailey – March 19, 2020
The common-interest privilege and using settlement counsel in licensing discussions may allow a party to shield sensitive information from disclosure in future discovery.
A Tale of Two Clauses
By Robert L. Arrington – March 12, 2020
Some recent cases illustrate how bad facts can make bad law.A company that wants to require its employees to arbitrate wage and hour disputes must have the employees sign a contract that contains an arbitration clause.
When Are Employee Non-Signatories Bound to an Arbitration Agreement?
By Jessica Breuer – March 4, 2020
A company that wants to require its employees to arbitrate wage and hour disputes must have the employees sign a contract that contains an arbitration clause.
CMS Issues New Arbitration Rule for Nursing Homes
By Mark Kantor, Karl Bayer, and Beth Graham – February 20, 2020
A resident’s right to continue to receive care at a long-term care facility must not be contingent upon signing an arbitration agreement.
In International Arbitration, Parties May Be Entitled to U.S. Discovery
By John B. Pinney – February 5, 2020
The Sixth Circuit held that a commercial arbitration panel in Dubai hearing a case between private parties might be entitled to take discovery aided by the U.S. courts.
Eleventh Circuit Limits Non-Party Subpoena Powers of Arbitrators to In-Person Hearings
By Robert L. Rothman and Rebecca Lunceford Kolb – January 29, 2020
The decision does not address whether a hearing can be commenced for the taking of testimony and documents from non-parties during the discovery period.
Non-Parties Face High Hurdle to Compelling Arbitration
By D. Reid Morelli – January 22, 2020
Although exceptions exist to the general rule that only parties to an agreement can enforce its arbitration, such exceptions are rare indeed.
Increase in Workers Subject to Arbitration Coincides with Supreme Court Rulings
By John Bickerman – January 16, 2020
The Court’s actions have significantly shifted policy through its opinions rather than policy being made by Congress.
California Arbitration Statute Is Temporarily Enjoined
By David L. Evans and Mitchell L. Marinello – January 9, 2020
The court stated that the temporary restraining order was justified due to the disruption the law would have on the formation of employment contracts.
Monster Energy v. City Beverages—Ninth Circuit’s New Disclosure Rules for Owner-Neutral
By Theodore J. Folkman and David L. Evans – January 2, 2020
The real question here is not about disclosure, but a question about the substantive problem posed by repeat players.
2019
New Henry Schein Decision Demonstrates Importance of Careful Drafting
By Mark Kantor – December 26, 2019
The decision issues a warning that the wording of an arbitration clause and any carve-outs must be carefully written to avoid unnecessary disputes and/or unintended consequences.
In International Arbitration, Parties May Be Entitled to U.S. Discovery
By John B. Pinney – December 18, 2019
The Sixth Circuit held that a commercial arbitration panel in Dubai hearing a case between private parties might be entitled to take discovery aided by the U.S. courts.
Michigan Court Refuses Arbitration of Sexual Harassment Claim
By Mitchell L. Marinello – December 4, 2019
What a court views as “unimaginable” is not much of a guiding legal principle.
Choice-of-Law Must Be Explicit to Bypass FAA
By Mark Kantor – November 25, 2019
The inclusion of a generic choice-of-law clause in an arbitration agreement is not sufficient to require the application of state law concerning the scope of review.
Epic Systems Did Not Take the National Labor Relations Board “Out of the Picture”
By Robert Arrington – November 19, 2019
Employers must remain careful of their employees’ rights under the National Labor Relations Act.
New Zealand Promotes ADR in Its New Trusts Act
By S.I. Strong – November 13, 2019
In adopting these provisions, New Zealand joins a number of other trust-friendly jurisdictions that are adopting trust arbitration while putting its own unique stamp on the issue.
U.S. Discovery Not Available in Foreign Enforcement Proceeding
By Mitchell L. Marinello – November 5, 2019
The court ruled that all statutory requirements for 28 U.S.C. §1782 were not satisfied.
Nevada Statute Preempted by FAA; Similar NJ Statute Survives For Time Being
By D. C. Toedt III – October 23, 2019
The Nevada Supreme Court held that the Federal Arbitration Act preempts NRS 597.995 and that statute did not void the arbitration clause.
Ohio Appellate Court Enforces Arbitration Agreements, Leaves Conflicts to Arbitrator
By Michael H. Diamant – October 16, 2019
The court ordered arbitration for a dispute involving multiple parties and contracts in a strong opinion supporting arbitration and the authority of an arbitrator under the AAA rules.
The New York Convention or the FAA: Circuit Split Still Stands
By Rebecca Lunceford Kolb – October 2, 2019
The Eleventh Circuit maintains its outlier status on the enforcement of non-domestic arbitration awards.
Evaluation in Mediation
By Joan Stearns Johnsen – September 24, 2019
The conversation should change from whether a mediator’s style is evaluative or facilitative to how effective the mediator is.
Cert. Granted in International Arbitration Case Involving Non-Signatory
By Mark Kantor – September 18, 2019
We shall soon learn how the U.S. Supreme Court believes non-signatories fit into the commercial arbitration universe.
New York Law Prohibiting Arbitration of Sexual Harassment Claims Is Preempted
By Mitchell L. Marinello – September 12, 2019
State legislatures and courts are constantly trying to create ways around arbitration agreements, and either do not consider or concern themselves with federal law in this area.
California Court Discusses Another Exception to Doctrine of Officio Functus
By Joel Levine – September 4, 2019
The California Supreme Court explained that the doctrine applies only after the arbitrator’s assigned duties have ended and is not so rigid as to always apply after the issuance of an award.
Arbitrator’s Failure to Issue a “Reasoned Award” Results in a Remand
By Maheema Haque – August 28, 2019
Although many arbitral institutions require or at least encourage “reasoned awards,” they generally do not provide guidance on what a “reasoned” award means.
Ambiguous Arbitration Provision Prohibits Class Arbitration of Dispute
By Andrew Campbell – August 21, 2019
The Supreme Court held that consent to a class arbitration cannot be inferred through the application of state court rules for resolving ambiguous contracts.
Carve-Out for Equitable Relief Trumped by AAA Rule
By Joel Levine – August 14, 2019
The court held that the carve-out did not remove from the arbitrator the power to decide arbitrability.
What Qualifies as a Reasoned Award?
By S.I. Strong – July 29, 2019
Reasoned awards are not required in arbitration, but if the parties contract for such an award, they are entitled to receive such a document.
Petrobas Decision Rejects Allegations of Arbitrator Bias
By Mark Kantor and Mitchell Marinello – July 24, 2019
The opinion continues trend of skeptical treatment by federal courts toward a losing party’s allegations that an arbitrator showed “evident partiality.”
Homeowner Must Arbitrate Roofing Dispute
By J. Kent Holland, Jr. – July 17, 2019
An agent can bind a principal to an arbitration agreement just like any other contract.
New Jersey Court Applies Severability Principle
By Joel Levine – July 10, 2019
This principle holds that an agreement to arbitrate is a separate agreement from the contract in which the arbitration clause is contained.
Settlement Agreements and the New York Convention
By S.I. Strong – June 26, 2019
The world of international commercial dispute resolution is becoming increasingly complex.
New Jersey: Time to Review Those Arbitration Clauses Again?
By Robert E. Bartkus – June 19, 2019
Some highlights from New Jersey court rulings that are important for transaction lawyers drafting arbitration clauses.
Supreme Court Eliminates “Wholly Groundless” Exception
By John Haarlow, Jr. – June 12, 2019
Parties who receive meritless motions to compel arbitration have to let the arbitrator decide the question if that is what their arbitration agreement provides.
Canadian Law Lets Consumers Avoid Arbitration Clauses that Prohibit Class Actions
By Daniel Urbas – June 6, 2019
Business customers remain bound by their agreements.
Kentucky Legislature Overrules Snyder Decision
By Jay Inman – May 30, 2019
A new law reaffirms an employer’s right to use arbitration agreements.
Reframing: A Lesson in Plain View
By John Bickerman – May 22, 2019
Use this technique to help parties overcome a major psychological barrier to settlement.
IBA Subcommittee Publishes Technology Guide
By S.I. Strong – May 8, 2019
The guide discusses options that can be used to augment or assist international arbitration.
Debt Collector Waived Right to Arbitrate
By Mitchell L. Marinello – May 1, 2019
Parties who wish to enforce an arbitration agreement should not delay in seeking such relief.
Consolidation and Joinder in Arbitration
By James Reiman and Megan Smith Richardson – April 24, 2019
A recent case in Ohio provides an interesting example of the issues that may arise when joining parties and cases.
Threshold Arbitrability Questions: Who Gets to Decide?
By Arielle Wasserman – April 17, 2019
If a contract with a public board is not included in the board’s minutes, do the courts or the arbitrator decide if its arbitration clause is enforceable?
Discovery in Arbitration: Agreement, Plans, and Fairness
By Janice L. Sperow – April 10, 2019
One arbitrator’s view of how you can structure the discovery process.
District Court Defers to Appellate Arbitration Panel
By Mark Kantor and Mitchell Marinello – April 03, 2019
The interesting aspect of the district court decision is that it applies the same standard of review to the appellate arbitration award as it would apply to an initial award under the FAA.
Canadian Court Defers to Appellate Arbitration Decision
By Daniel Urbas – March 21, 2019
Together, limited jurisdiction and deferential review advance the central aims of commercial arbitration: efficiency and finality.
Ninth Circuit Permits Appeal of Order Remanding Case for New Arbitration
By Andrew D. Campbell – March 06, 2019
The circuit determined that an order that vacates and orders further proceedings was appealable.
What Will They Think of Next?
By Mitchell L. Marinello – February 27, 2019
The FAA says state law may not discriminate against arbitration agreements, but state legislatures and courts, most recently in Kentucky, keep coming up with new ways to avoid this ruling.
Parties Share Responsibility for Getting Complete Arbitrator Disclosures
By Jeanne Kohler – February 13, 2019
A party’s failure to ask questions can doom its later effort to avoid confirmation of the award.
Second Circuit Recognizes Exception to Functus Officio Doctrine
By Michael S. Oberman – February 6, 2019
The court affirmed, largely based on precedent from other circuits.
The Hague Conference Guide on the Use of Video Links
By S. I. Strong – January 23, 2019
Although the Hague Evidence Convention is not binding in arbitration, neutrals and advocates would be well advised to take these principles into consideration.
Seventh Circuit: Class Arbitration Is for Courts to Decide, Not Arbitrators
By Gail Jankowski – January 17, 2019
Although predictions are hazardous, in all likelihood the district court will find that the applicable arbitration clause does not authorize class or collective arbitration.
Supreme Court Says “Wholly Groundless” Argument Is Just That
By Mitchell L. Marinello – January 10, 2019
In the absence of a clause giving the arbitrator the right to decide his or her own jurisdiction or the adoption of arbitration rules that give the arbitrator this authority, the courts are responsible for deciding issues of arbitrability.
2018
What Do You Call a Worker?
By Maretta Comfort Toedt – December 28, 2018
The Federal Arbitration Act, mandatory arbitration agreements, and independent contractors.
Eleventh Circuit Adds to Circuit Split Over Class Arbitrations
By Henry R. Chalmers – December 20, 2018
According to the court, incorporating AAA Rules into an arbitration agreement is sufficient evidence that the parties intended for the arbitrator, not a court, to decide whether an agreement permits arbitration of class claims.
Ethics Misstep Leads to Fee Award Being Vacated
By Mitchell L. Marinello – December 6, 2018
Lawyers should disclose conflicts of interest at the beginning of the engagement to avoid the risk of disqualification and of losing the client and compensation.
Non-Signatory Insurers Able to Compel Arbitration
By Melanie Mohr – November 28, 2018
Using the doctrine of equitable estoppel can require plaintiffs to arbitrate when their claims are intertwined with others that are subject to arbitration.
U.S. Supreme Court to Decide Three Arbitration Cases in Fall 2018 Term
By Beth Graham – November 16, 2018
The Court heard oral arguments in October of this year.
Be Sure Your Arbitration Agreement Is Clear about Who Decides Arbitrability
By Maretta Comfort Toedt – November 7, 2018
The parties also did not settle on whether the agreement provided the dispute to be heard as a class.
Arbitration Can’t Be Efficient if the Parties (or Any Party) Won’t Let It Be
By Robert L. Arrington – October 31, 2018
Sometimes the parties themselves conspire, wittingly or unwittingly, to make the process slower and more expensive than litigation.
California’s Birbrower Decision Is Laid to Rest
By Dixon Q. Dern – October 25, 2018
Lawyers are no longer considered to be engaging in “the unauthorized practice of law.”
Second Circuit Declines to Enforce Consumer Arbitration Post-Bankruptcy
By Briana Echols – October 10, 2018
Employers can use arbitration clauses to prevent class action suits from employees.
Texas Court Affirms Award Against Absent Party
By Melanie Mohr – September 26, 2018
Dixie ordered to pay $16 million for breach of contract.
California Requires New Mediation Disclosure
By Ana M. Sambold – September 20, 2018
Attorneys are now required to provide clients with a printed disclosure regarding confidentiality restrictions in mediation and obtain a signed acknowledgement.
Award Confirmed Despite Exclusion of Evidence
By Mark Kantor – September 13, 2018
An arbitrator is not required to accept all the evidence so long as the parties receive a fundamentally fair hearing.
"Very Limited Review" Given to Arbitration Award in Divorce Setting
By Andrew VandenBerg – September 6, 2018
The arguments for modification or rejection did not meet requirements stated in the Illinois Uniform Arbitration Act.
Delegation Clause in Insurance Contract Is Void under Virginia Law
By Mengru Song – August 29, 2018
Insurers cannot compel a policyholder to arbitrate insurance disputes.
Mississippi Supreme Court Rejects Trial Court’s Modification of Award
By Katharine Kohm – August 23, 2018
The court emphasized that "arbitration is meant to supplant litigation, not supplement it."
Non-Signatory Cannot Be Required to Arbitrate
By Julia Karaulna – August 15, 2018
The First Circuit concluded that agency, equital estoppel, and third-party beneficiary theories did not apply in this case.
Two Brokers Sue FINRA: The Immunity of Arbitral Institutions
By Mark Kantor – August 9, 2018
A recent decision from the U.S. Court of Appeals for the Seventh Circuit leaves many important issues about this topic unresolved.
Judgment Confirming Award Reversed Due to Hague Convention
By Mitchell L. Marinello – July 31, 2018
The California Court of Appeals found two recent cases unpersuasive.
Intervention Denied in Proceeding to Confirm Arbitration Award
By S.I. Strong – July 20, 2018
Proposed intervenors claimed an interest in the proceeding based on a fear that the award might ultimately be enforced against them.
Post-Litigation Arbitration Agreement Held Unenforceable
By Raven Villegas – July 13, 2018
Compelling arbitration a year after the commencement of litigation is viewed as a delay tactic.
Uber Defeated by the Color of Its Hyperlink
By Liz Kramer – July 5, 2018
Does enforcement of an arbitration clause hinge on the color of your website design?
Supreme Court to Hear “Groundless Arbitration” Case
By Mark Kantor – June 29, 2018
Does the Federal Arbitration Act permit an arbitrator to decide arbitrability?
Enforcement of Arbitration Clause Does Not Constitute State Action
By Milana Lickova – June 22, 2018
AT&T customers brought a class action alleging false advertising of data services.
Will SEC Approve Mandatory Securities Arbitration?
By S.I. Strong – June 13, 2018
Questions have arisen as interest in shareholder arbitration has been increasing around the world.
Are Truck Drivers Exempt from the FAA When Classified as Independent Contractors?
By Mitchell L. Marinello – June 6, 2018
The exemption does not apply to sales employees but only to “transportation workers.”
An Epic Decision
By Debra Fischman, James M. Garner, and Jeffrey D. Kessler – May 30, 2018
Employers may continue to require workers to relinquish the right to bring class-action claims on disputes over wages and hours.
Text Message Plaintiff Not Bound to Arbitrate
By Nicole O’Toole – May 23, 2018
Subway's spam causes headache, not indigestion.
Wanna Be a Mediator? Find a Niche
By John Bickerman – May 16, 2018
Becoming a successful neutral is not an easy task and there is no guarantee for success.
Arbitral Immunity Does Not Apply to Claim for False Advertising
By S.I. Strong – May 10, 2018
The ultimate decision in federal court could have significant repercussions on the arbitral industry.
Arbitrators Not Authorized to Subpoena Non-Parties for Document Discovery
By Mark Kantor – May 2, 2018
The Ninth Circuit based its decision on this emerging rule on a textual reading of the FAA.
FLSA Claims Held Arbitrable Against All Three Employers
By Kelly Rice – April 25, 2018
Signing an employment contract with only one company does not preclude arbitration with all companies involved.
Arbitrator Has Authority to Make Summary Dispositions
By Mark Kantor and Mitchell Marinello – April 19, 2018
The court found such authority was implicit.
Arbitrator Decides Own Jurisdiction under JAMS Rules
By Henry Caldwell – April 13, 2018
The incorporation of JAMS rules into the clause granted power “clearly and unmistakably” to the arbitrators.
Med-Arb: Maybe Not a Better Idea
By John Bickerman – April 4, 2018
Should the same person serve as the mediator and arbitration in a single dispute?
Minor Not Bound by Mother’s Arbitration Agreement
By S.I. Strong – March 28, 2018
A class action complaint was filed against Credit One Bank for repeated, harassing telephone calls to the child’s cellphone.
Appropriations Act Targets Arbitration
By Mark Kantor – March 22, 2018
A last-minute budget agreement slides a pre-dispute arbitration provision rider into final legislation.
Mixing It Up: Did We Mediate or Arbitrate?
By Mitchell L. Marinello – March 14, 2018
Be careful to properly document the nature of your proceedings.
Reference to Nonexistent Arbitration Forum Nullifies Arbitration Agreement
By Robert E. Bartkus – March 8, 2018
CashCall has been the subject of significant litigation due to its unique business model and bizarre arbitration clauses.
Email to Employee Not Sufficient Notice of Arbitration
By S.I. Strong – February 28, 2018
A recent case from the English Commercial Court considers issues relating to service of notice of arbitration by email.
Financial Hardship Can Nullify Employee’s Obligation to Arbitrate Statutory Claims
By Lally Gartel – February 13, 2018
New York appellate court rules the trial court also could consider the risk that the plaintiff might have to pay the defendant’s legal fees and expenses.
How (Not) to Carve Out Injunctive Relief from Arbitration Clauses
By D.C. Toedt III – February 8, 2018
A lesson in drafting.
Federal Court Refuses to Seal Judicial Record of Arbitration
By Mark Kantor – January 23, 2018
A recent decision offers a reminder of the hurdle a party must meet to seal a proceeding to confirm or vacate an award.
Ninth Circuit Holds that Arbitration Is Not State Action
By S.I. Strong – January 12, 2018
There’s been much scholarly debate on how best to describe the connection between arbitration and the Constitution.
Arbitrator Not Required to Follow Own Precedent
By Michael S. Oberman – January 5, 2018
The arbitrator interpreted a collective bargaining agreement differently in two different cases.
Together, limited jurisdiction and deferential review advance the central aims of commercial arbitration: efficiency and finality.
By Daniel Urbas
In July 2018, a Canadian court issued a decision giving deference to a decision made by an appellate arbitration panel. SG Ceresco Inc. v. BroadGrain Commodities Inc., 2018 MBQB 120.
SG Ceresco Inc. (Ceresco) and BroadGrain Commodities Inc. (BroadGrain) entered into a contract for the purchase of $684,649 USD worth of soybeans (the contract). BroadGrain sourced the soybeans from Prograin Inc., a third party. Ceresco paid BroadGrain’s initial invoices but, further to information Ceresco received after making partial payment, disputed the quality of the first shipment. Inspections of subsequent shipments raised the same quality questions. Ceresco and BroadGrain exchanged positions on the issues of quality and inspection but did not resolve their dispute, leaving BroadGrain’s final invoice unpaid.
The contract provided that any disputes would be resolved by arbitration through the Canadian Special Crops Association (CSCA), a national industry association for pulse crops and special crop growers. The CSCA provides a comprehensive set of arbitration rules, including internal appeals, which Ceresco and BroadGrain agreed in the contract to use.
BroadGrain initiated arbitration against Ceresco, and a three-member arbitration panel, called an “Arbitration Committee” under the arbitration rules, determined that Ceresco was entitled to compensation in the amount of $265,000 USD for the losses stemming from the BroadGrain’s breaches of the contract. BroadGain appealed to a five-member arbitration tribunal called the “Board of Appeal.” The Board of Appeal set aside the Arbitration Committee’s award and issued an award requiring Ceresco to pay BroadGrain’s final invoice in the amount of $137,000 USD. Ceresco challenged the board’s decision in the Canadian courts.
Madam Justice Grammond, Manitoba Queen’s Bench, dismissed the challenge to the Board of Appeal decision. She applied Teal Cedar Products v. British Columbia, 2017 SCC 32, para. 1, in which the Supreme Court of Canada noted that the scope of appellate intervention in commercial arbitration is narrow even when the court’s jurisdiction is limited to a question of law. Judge Grammond also relied on the Supreme Court of Canada’s decision in Creston Moly Corp. v. Sattva Capital Corp., 2014 SCC 53 which held that, even where jurisdiction exists, the deferential standard of review of reasonableness almost always applies to arbitration awards.
The judge pointed to the policy objectives stated in Teal Cedar Products v. British Columbia: “Together, limited jurisdiction and deferential review advance the central aims of commercial arbitration: efficiency and finality.” These key policy objectives of commercial arbitration were also noted in Wolfe et al v. Taylor et al; Fat Cat Farms Ltd et al v. Wolfe et al, 2017 MBCA 74, para. 74.
Daniel Urbas is an experienced arbitrator and mediator at Urbas Arbitral in Montreal, QC, Canada.
Copyright © 2019, American Bar Association. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or downloaded or stored in an electronic database or retrieval system without the express written consent of the American Bar Association. The views expressed in this article are those of the author(s) and do not necessarily reflect the positions or policies of the American Bar Association, the Section of Litigation, this committee, or the employer(s) of the author(s).
Together, limited jurisdiction and deferential review advance the central aims of commercial arbitration: efficiency and finality.
By Daniel Urbas
In July 2018, a Canadian court issued a decision giving deference to a decision made by an appellate arbitration panel. SG Ceresco Inc. v. BroadGrain Commodities Inc., 2018 MBQB 120.
SG Ceresco Inc. (Ceresco) and BroadGrain Commodities Inc. (BroadGrain) entered into a contract for the purchase of $684,649 USD worth of soybeans (the contract). BroadGrain sourced the soybeans from Prograin Inc., a third party. Ceresco paid BroadGrain’s initial invoices but, further to information Ceresco received after making partial payment, disputed the quality of the first shipment. Inspections of subsequent shipments raised the same quality questions. Ceresco and BroadGrain exchanged positions on the issues of quality and inspection but did not resolve their dispute, leaving BroadGrain’s final invoice unpaid.
The contract provided that any disputes would be resolved by arbitration through the Canadian Special Crops Association (CSCA), a national industry association for pulse crops and special crop growers. The CSCA provides a comprehensive set of arbitration rules, including internal appeals, which Ceresco and BroadGrain agreed in the contract to use.
BroadGrain initiated arbitration against Ceresco, and a three-member arbitration panel, called an “Arbitration Committee” under the arbitration rules, determined that Ceresco was entitled to compensation in the amount of $265,000 USD for the losses stemming from the BroadGrain’s breaches of the contract. BroadGain appealed to a five-member arbitration tribunal called the “Board of Appeal.” The Board of Appeal set aside the Arbitration Committee’s award and issued an award requiring Ceresco to pay BroadGrain’s final invoice in the amount of $137,000 USD. Ceresco challenged the board’s decision in the Canadian courts.
Madam Justice Grammond, Manitoba Queen’s Bench, dismissed the challenge to the Board of Appeal decision. She applied Teal Cedar Products v. British Columbia, 2017 SCC 32, para. 1, in which the Supreme Court of Canada noted that the scope of appellate intervention in commercial arbitration is narrow even when the court’s jurisdiction is limited to a question of law. Judge Grammond also relied on the Supreme Court of Canada’s decision in Creston Moly Corp. v. Sattva Capital Corp., 2014 SCC 53 which held that, even where jurisdiction exists, the deferential standard of review of reasonableness almost always applies to arbitration awards.
The judge pointed to the policy objectives stated in Teal Cedar Products v. British Columbia: “Together, limited jurisdiction and deferential review advance the central aims of commercial arbitration: efficiency and finality.” These key policy objectives of commercial arbitration were also noted in Wolfe et al v. Taylor et al; Fat Cat Farms Ltd et al v. Wolfe et al, 2017 MBCA 74, para. 74.
Daniel Urbas is an experienced arbitrator and mediator at Urbas Arbitral in Montreal, QC, Canada.
Copyright © 2019, American Bar Association. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or downloaded or stored in an electronic database or retrieval system without the express written consent of the American Bar Association. The views expressed in this article are those of the author(s) and do not necessarily reflect the positions or policies of the American Bar Association, the Section of Litigation, this committee, or the employer(s) of the author(s).
Together, limited jurisdiction and deferential review advance the central aims of commercial arbitration: efficiency and finality.
By Daniel Urbas
In July 2018, a Canadian court issued a decision giving deference to a decision made by an appellate arbitration panel. SG Ceresco Inc. v. BroadGrain Commodities Inc., 2018 MBQB 120.
SG Ceresco Inc. (Ceresco) and BroadGrain Commodities Inc. (BroadGrain) entered into a contract for the purchase of $684,649 USD worth of soybeans (the contract). BroadGrain sourced the soybeans from Prograin Inc., a third party. Ceresco paid BroadGrain’s initial invoices but, further to information Ceresco received after making partial payment, disputed the quality of the first shipment. Inspections of subsequent shipments raised the same quality questions. Ceresco and BroadGrain exchanged positions on the issues of quality and inspection but did not resolve their dispute, leaving BroadGrain’s final invoice unpaid.
The contract provided that any disputes would be resolved by arbitration through the Canadian Special Crops Association (CSCA), a national industry association for pulse crops and special crop growers. The CSCA provides a comprehensive set of arbitration rules, including internal appeals, which Ceresco and BroadGrain agreed in the contract to use.
BroadGrain initiated arbitration against Ceresco, and a three-member arbitration panel, called an “Arbitration Committee” under the arbitration rules, determined that Ceresco was entitled to compensation in the amount of $265,000 USD for the losses stemming from the BroadGrain’s breaches of the contract. BroadGain appealed to a five-member arbitration tribunal called the “Board of Appeal.” The Board of Appeal set aside the Arbitration Committee’s award and issued an award requiring Ceresco to pay BroadGrain’s final invoice in the amount of $137,000 USD. Ceresco challenged the board’s decision in the Canadian courts.
Madam Justice Grammond, Manitoba Queen’s Bench, dismissed the challenge to the Board of Appeal decision. She applied Teal Cedar Products v. British Columbia, 2017 SCC 32, para. 1, in which the Supreme Court of Canada noted that the scope of appellate intervention in commercial arbitration is narrow even when the court’s jurisdiction is limited to a question of law. Judge Grammond also relied on the Supreme Court of Canada’s decision in Creston Moly Corp. v. Sattva Capital Corp., 2014 SCC 53 which held that, even where jurisdiction exists, the deferential standard of review of reasonableness almost always applies to arbitration awards.
The judge pointed to the policy objectives stated in Teal Cedar Products v. British Columbia: “Together, limited jurisdiction and deferential review advance the central aims of commercial arbitration: efficiency and finality.” These key policy objectives of commercial arbitration were also noted in Wolfe et al v. Taylor et al; Fat Cat Farms Ltd et al v. Wolfe et al, 2017 MBCA 74, para. 74.
Daniel Urbas is an experienced arbitrator and mediator at Urbas Arbitral in Montreal, QC, Canada.
Copyright © 2019, American Bar Association. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or downloaded or stored in an electronic database or retrieval system without the express written consent of the American Bar Association. The views expressed in this article are those of the author(s) and do not necessarily reflect the positions or policies of the American Bar Association, the Section of Litigation, this committee, or the employer(s) of the author(s).