What Can I Do If An Arbitration Award Is Made Against Me?
A final arbitration award is final and cannot be appealed in terms of its content.
A losing party can challenge the award on limited, largely procedural grounds and within a very limited time.
As a general rule, a final arbitration award is final and cannot be appealed in terms of its content. However, a losing party can challenge the award on limited, largely procedural grounds and within a very limited time. Such a challenge can be made either before or when the winning party seeks recognition and enforcement of the award through a court.
In making such a challenge, the party can seek to have the award (a) nullified, (b) set aside (in whole or part), (c) varied or (d) remitted back to the Tribunal. UNCITRAL Model Law refers to such a challenge as having ‘recourse’ against an award.
Article 34 of the Model Law sets out the grounds for setting aside an award prior to enforcement. Similar grounds are set out in Article 36 for challenging an award when the winning party seeks enforcement of the award through a court. These grounds are also set out in Article V of the New York Convention.
These grounds cover jurisdictional and procedural issues and include (i) incapacity of a party to the arbitration agreement, (ii), inadequate notice of proceedings or a party is prevented from presenting their case, (iii) the decision exceeds the authority or scope of the dispute, (iv) irregularity in arbitral proceedings, (vi) the subject matter is not capable of settlement under the law of the State and (vi) the award is in conflict with the public policy of the State.
An application for setting aside made under Article 34 must be made within 3 months from the date that the party receives the award or, in the case where an award has been corrected or request for interpretation addressed, then the 3 month time limit runs from the date upon which the Tribunal has disposed of the correction or interpretation.