Appellate Law

"Manifest Disregard Of The Law" No Longer A Valid Basis On Which To Challenge Arbitration Award

The Alabama Supreme Court followed the lead of the United States Supreme Court and held that, for cases decided under the Federal Arbitration Act, manifest disregard for the law is not a valid basis on which to challenge the arbitration award.  In Hall Street Associates, LLC v. Mattel, Inc., 128 S.Ct. 1396 (2008), the United States Supreme Court held that the only bases on which an arbitration award can be challenged were the bases set out in 9 U.S.C. 10(a) and, because "manifest disregard of the law" was not one of those grounds listed, it cannot serve as a ground upon which the award could be reversed. In Hereford v. D.R. Horton, Inc., [Ms. 1070396] (Ala. Jan. 9, 2009), the Alabama Supreme Court followed suit.  The Alabama Supreme Court overruled its prior, inconsistent caselaw and held that, consistent with the United States Supreme Court holding, "manifest disregard for the law" is not a proper ground by which an arbitration award can be challnged where the arbitration was held pursuant to the Federal Arbitration Act.

Full post as published by Alabama Appellate Watch on January 15, 2009 (boomark / email).