Enforcing Awards [Securities Dispute Resolution] Law and Legal Definition
Parties may voluntarily comply with an award. However, in the event of noncompliance, the arbitral panel has no power to enforce the award, only a court has the power to force compliance. Thus, a party seeking to enforce an award may have to sue in court.
The United States Code Title 9 on the Federal Arbitration Act provides for the enforcement of arbitral awards. Any party may sue for enforcement of the award within a year of the rendering of the arbitral award. (See §9) The court shall confirm the award unless it finds one of the grounds for refusal or deferral of recognition or enforcement of the award specified in §10 of the Federal Arbitration Act. These grounds are exclusive according to Supreme Court decision Hall Street Associates v. Mattel (U.S. Sup. 2008).
Grounds for vacating an award include:
If the award was obtained by corruption, fraud, or undue means; If there was evident partiality or corruption in the arbitrators, or either of them; where the arbitrators were guilty of misconduct in refusing to postpone the hearing, upon sufficient cause shown, or in refusing to hear evidence pertinent and material to the controversy; or of any other misbehavior by which the rights of any party have been prejudiced; or where the arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made.
Thus, a court will only vacate an award where there has been corruption, unfairness, or the arbitrators have exceeded their powers. These grounds are extremely difficult to prove as evidence tends to be highly circumstantial. Thus, it is uncommon for a court to vacate an award. Additionally, the time limitations provided for vacating, modifying, or correcting an award are more limiting than the time limitations for enforcing the award. While a party seeking enforcement can file a suit within a year of the rendering of the award, a party seeking to vacate an award has three months to file for vacation of the award. After the three month period has passed, the party has waived his or her right to seek vacation of the award.) However, regardless of the potential for success, an appeal can be used by a recalcitrant party to prolong nonpayment of damages and increase the costs of the dispute.
Legal Definition list
- Enforcement Power
- Enforcement Hotline [Energy Conservation]
- Enforcement Bureau [FCC]
- Enforcement Adjudication [Energy]
- Enforcement Action
- Enforcing Awards [Securities Dispute Resolution]
- Enfranchisement of Copyhold
- Engaged in a Pattern of Racketeering Activity
- Engaged in Business (Firearms)
- Engaged in the Business [Firearms]
- Engaging in Terrorist Activity