Unfortunately, due to its very nature, arbitration is generally not open for appeals. Its aim is to make the decision process quicker and much more cost efficient. In fact, the only way to appeal a verdict given by an arbitrator is to take it to a formal court hearing. However, this defeats the purpose of having arbitration in the first place. Also, because of agreements signed before the hearing, it may not be possible to take the case further into the legal system. There are, however, some exceptions.
The term jurisdiction refers to an arbitrator or a tribunal’s right to make a judgment in a particular area or zone. For instance, a foreign arbitrator may not always be able to be brought in to resolve a dispute. The jurisdiction argument is a difficult one to prove, because arbitration does not technically have to involve the formal legal system, therefore, anyone may have jurisdiction rights. However, if improper jurisdiction can be proven, an appeal may be made in an official courtroom.
The losing party may make a claim that the arbitrator or tribunal made a decision that was biased, unfair or out of line. Again, this is tricky to define, especially because the hearing is private. However, the following are some warning signs that the arbitrator may not be acting appropriately:
The arbitrator heavily favors corporations- though he or she may not be formally employed by a corporate entity; they are more likely to hear more than one case from the corporation’s side. The chances of him or her ever arbitrating an issue for an individual more than once is slim. Therefore, arbitrators have been known to build subtle relationships and favoritisms towards larger corporations.
The arbitrator is not a legal professional or an expert in the field- though it is not required to find a professional arbitrator, it is recommended for maximum experience and fairness.
The dispute is settled by only one arbitrator. Again, it is not required to have more than one arbitrator, but by presenting the case to a panel of three judges, the chances of fairness increase dramatically, and this decision is often seen in more comprehensive and complex cases in dispute between large entities.
The Arbitration Fairness Act recently passed in Congress and the House that protects individuals from being taken advantage of by larger organizations. Awards given in arbitration hearings concerning employment, consumer or franchise disputes, where a pre-dispute agreement was made are valid or enforceable.
Though it is difficult to challenge the award given by an arbitrator, or a set of arbitrators, it is possible in various circumstances. A competent arbitration attorney can assist you or your company in appealing an arbitration decision today.