This week marks the third anniversary of this blog devoted to interpretations of the Federal Arbitration Act. (Here’s the first post.) After 155 posts, can there possibly be more to say? Yes, indeed. Three new opinions from federal courts of appeals demonstrate how new issues keep “cropping” up in arbitration law each week.

The first case has to do with crop insurance and whether an arbitrator exceeded his power. In Davis v. Producers Agricultural Ins. Co., __ F.3d__ 2014 WL3844815 (11th Cir. Aug. 6, 2014), the district court vacated the arbitrator’s award and the Eleventh Circuit reversed. The decision revolved around two legal issues. One is not likely to come up for many of us (whether the arbitrator exceeded his authority by interpreting an aspect of a crop reinsurance policy that is reserved to the Federal Crop Insurance Corporation; he didn’t because the FCIC had already approved the arbitrator’s interpretation). But the second is a harsh result that could impact many parties in arbitration. The applicable AAA rules provided that the arbitrator must issue his opinion within 30 days of closing the proceeding, but the arbitrator did not issue the award until the 33rd day. The losing party argued that by issuing the award late, the arbitrator had exceeded his power under Section 10, and the award should be vacated. The Eleventh Circuit relied on a 1969 case from the 5th Circuit to find that the losing party had waived his right to argue timeliness by failing to “object at the expiration of the thirty-day period.” This strikes me as an unrealistic standard. What party in their right mind would aggravate an arbitrator who is about to issue an award by complaining that the decision is tardy? None, unless that party already knew it was going to lose.

Read original article


Tags: