Challenge of Arbitration Award Too Late

The Alabama Supreme Court reversed an order vacating an arbitration award because the argument that the defendant offered in support of his motion to vacate came too late. To avoid the arbitration award, the defendant submitted that he should not have been compelled to arbitrate because he was not a party to the arbitration agreement. The Court held that the defendant waived the argument; he should have raised it in an ARAP 4(d) appeal from the trial court order that directed the claims against him to arbitration. Jenks v. Harris, No. 1050686 (March 14, 2008).

The Court noted that the order vacating the arbitration award was an appealable order under Ala. Code §6-6-15, which provides that, “when an arbitration award is set aside by the trial court, ‘such action shall be a final judgment from which an appeal shall lie as in other cases.’” The Court added that the defendant failed to establish that in issuing an award, the arbitrator “manifestly disregarded the law.” The Court wrote, “[j]udicial review under the ‘manifest disregard of the law’ ground is severely limited and . . . the party challenging an award on this ground bears a heavy burden.’” That burden includes proof that the arbitrator knew the applicable law but ignored it, and the law was “’well defined, explicit and clearly applicable to the case.’”