Arbitration Arbitration Awards and Enforcement 2 — Questions and Answers
Question 1: What does 'confirmation of an arbitral award' mean under US law?
- The arbitrator re-reads the award at a public hearing
- A court converts the arbitral award into a court judgment enforceable by court mechanisms (Correct answer)
- The parties sign a consent decree
- The award is registered with the AAA
Correct answer: A court converts the arbitral award into a court judgment enforceable by court mechanisms
Confirmation under FAA Section 9 allows a party to have an arbitral award entered as a judgment of the court, making it enforceable through court enforcement mechanisms.
Question 2: What is the doctrine of 'manifest disregard of the law' as it applies to arbitral awards in the US?
- A constitutional ground for vacating any unfair award
- A judicially-created ground for vacating an award where the arbitrator knowingly ignores clear, applicable law (Correct answer)
- A rule requiring arbitrators to cite case law in every award
- A statutory ground codified in FAA Section 10
Correct answer: A judicially-created ground for vacating an award where the arbitrator knowingly ignores clear, applicable law
Manifest disregard is a judicially-created standard allowing vacatur when arbitrators knew of and deliberately ignored clear, governing law, though its current status varies by circuit.
Question 3: In a multi-party arbitration, how are arbitral awards typically structured when different parties have different claims?
- A single award covers all parties uniformly
- The tribunal issues separate awards for each bilateral pair
- The award specifies liability and damages for each claim and each party separately (Correct answer)
- Only the claimant receives an award; respondents do not
Correct answer: The award specifies liability and damages for each claim and each party separately
In multi-party arbitrations, the award typically addresses each party's claims and counterclaims separately, specifying who owes what to whom.
Question 4: What is an 'interim award' in arbitration?
- A final award issued before hearing evidence
- An award resolving specific preliminary issues such as jurisdiction or liability before a final award (Correct answer)
- A court order staying arbitration proceedings
- An agreement to pause arbitration proceedings
Correct answer: An award resolving specific preliminary issues such as jurisdiction or liability before a final award
An interim award resolves a discrete issue, such as jurisdictional challenges or liability alone, prior to the final award addressing all remaining issues including damages.
Question 5: Under ICSID (International Centre for Settlement of Investment Disputes) rules, how is an award enforced?
- Through the New York Convention enforcement mechanism
- ICSID awards are directly enforceable as if they were final judgments of the domestic courts of each member state (Correct answer)
- Through a separate UN enforcement protocol
- ICSID awards require Security Council approval before enforcement
Correct answer: ICSID awards are directly enforceable as if they were final judgments of the domestic courts of each member state
Under the ICSID Convention, member states are required to recognize and enforce ICSID awards as if they were final domestic court judgments, bypassing the need for a separate enforcement proceeding.
Question 6: What is 'interest on an arbitral award' and how is it typically handled?
- Interest is never awarded in arbitration
- Arbitrators have discretion to award pre- and post-award interest based on the applicable law and circumstances (Correct answer)
- Interest must equal the federal funds rate
- Interest can only be awarded if both parties agree
Correct answer: Arbitrators have discretion to award pre- and post-award interest based on the applicable law and circumstances
Arbitrators generally have discretion to award pre-award interest (from the date of breach) and post-award interest (from the award date until payment), guided by applicable law.
Arbitration Arbitration Awards and Enforcement 2
What does 'confirmation of an arbitral award' mean under US law?