The American Arbitration Association (AAA) has adopted rules, effective November 1, 2013, providing parties to commercial and construction arbitrations with an optional process for appealing an arbitration award. Except for the occasional inclusion of an ad hoc private appeal process in a contractual ADR provision, or unique state statutes, there have been limited opportunities for appellate review of the “merits” of arbitration awards.
With increasing frequency, parties dissatisfied with an arbitration award are seeking judicial review of their awards. The scope of that review is limited. In federal court, awards are only reviewed pursuant to the Federal Arbitration Act (FAA), 9 U.S.C. § 1 et seq., and the limited statutory grounds set forth in the act. The grounds generally relate to the conduct of the arbitrator and include corruption, fraud, undue means, partiality, or other misconduct or fault. The FAA does not provide for review of the merits of an award, and contracting parties cannot confer jurisdiction on the federal courts to expand the scope of judicial review.