Enforcing Arbitration Agreements: Two Lessons From Recent Cases
In his International Arbitration column, John Fellas discusses some recent cases helpful to parties seeking to minimize the time spent in court to enforce an agreement to arbitrate. More specifically these cases provide guidance regarding the relief to request from a court in the context of a motion to stay or compel under the FAA: ask the court to stay rather than dismiss a lawsuit brought in breach of an arbitration clause; or ask the court to enforce the delegation provision in an arbitration clause if it has one.
November 04, 2015 at 04:18 PM
13 minute read
Parties don't always respect their arbitration agreements. Sometimes they commence litigation even though they agreed to resolve their disputes by arbitration. Other times, they refuse to participate in an ongoing arbitration. Frequently, they do both. And often the only reliable way to deal with a party that sidesteps its obligation to arbitrate is to seek the assistance of the courts.
That recourse to the courts may at times be indispensable to the enforcement of an arbitration agreement creates for arbitration a very particular predicament. One way of understanding an arbitration clause, after all, is as an agreement by which parties give up a right they would otherwise have to resolve their disputes in court; their intent is to resolve those disputes by arbitration instead of in the courts. And herein lies the predicament. On the one hand, I may have no choice but to go to court to compel a party to arbitrate. On the other, my invocation of the judicial process to enforce my arbitration rights is fundamentally at odds with my rationale for having entered into an arbitration agreement in the first place; the precise court involvement required to give effect to my intent to arbitrate in some fundamental sense subverts it.
It is essential to the efficacy of arbitration, therefore, that parties who need the assistance of the courts to enforce their arbitration agreements do not have to spend too long in the courts to secure it. If parties are required to engage in protracted litigation simply to get an arbitration going, arbitration would lose its appeal. Indeed, in the United States, the federal policy in favor of arbitration is animated precisely by the desire “to move the parties to an arbitrable dispute out of court and into arbitration as quickly and easily as possible.” Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 22 (1983).
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