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July 2015

Contract That Prohibits Challenge To Arbitration Award Is Unenforceable

By: Howard S. Suskin Ripped-contract

A contract provision stating that the parties expressly agreed not to challenge the validity of their arbitration or an arbitration award was held to be contrary to public policy and void and unenforceable.  Atlanta Flooring Design Centers, Inc. v. R.G. Williams Construction, Inc., A15A0664 (Ga. Ct. App., 2d Div., July 16, 2015).  The contract stated: “The award rendered by the arbitrator(s) shall be final and binding on the parties and judgment upon the award may be entered in any court of competent jurisdiction.  Contractor and Subcontractor hereby expressly agree not to challenge the validity of the arbitration or the award.”  Applying Georgia law, and relying on cases decided under the Federal Arbitration Act, the court concluded that the statutory grounds for vacating an arbitration award may not be waived or eliminated by contract.  The court reasoned that the statutory grounds for a court to review and vacate an award demonstrate Congressional intent to provide a minimum level of due process for parties to an arbitration.

 

 


Delay In Seeking Arbitration Waived Right To Arbitrate

GavelBy: Howard S. Suskin

A defendant in a class action antitrust suit that did not move to compel arbitration until shortly before trial was set to begin was held to have waived its right to arbitrate.  In re: Cox Enterprises, Inc. Set-Top Cable Television Box Antitrust Litigation, No. 14-6158 (10th  Cir., June 24, 2015).  Defendant’s motion to compel arbitration followed extensive discovery, class certification, and potentially dispositive motions.  The court found that the defendant’s assertion of its right to arbitrate was overly late and inconsistent with its conduct in litigating the case.  Here

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