Arbitrator's Application of Incorrect Law Basis for Vacatur of Arbitration Decision

July 8, 2013

While the misapplication of a law is ordinarily not a reason for a judge to throw out an arbitration award, a Civil Court judge has refused to confirm an arbitration award because it was contrary to established law.

In this case, the arbitrator was found to have acted contrary to established law in determining the proper standard for which party was obligated to prove its case. Upon application to the court for confirmation and enforcement of that arbitration award, the judge held that while the misapplication of a correct law would not lead to vacatur, here, because the arbitrator's decision was based on a wrong legal principal and thus contrary to established law, it was deemed irrational under Article 75 of the CPLR, and could not stand.