An arbitrator has ethical obligations to maintain the integrity and fairness of the arbitration process, as well as ethical obligations to the parties to an arbitration. An arbitrator’s adherence to ethical standards is especially important given the limited circumstances under which courts are authorized to vacate arbitration awards.
The neutrality of an arbitrator is essential to the arbitration process; an arbitrator’s lack of impartiality is one of the few bases upon which a court may vacate an arbitral award. Under the Federal Arbitration Act, a court may vacate an arbitration award “where there was evident partiality or corruption in the arbitrators, or either of them….” 9 U.S.C. §10(a)(2). Similarly, under New York law, a court can vacate an arbitration award “if the court finds that the rights of that party were prejudiced by…partiality of an arbitrator appointed as a neutral….” CPLR §7511(b)(1)(ii). In both the state and federal contexts, the party seeking to vacate an arbitral award has the burden of proving the existence of evident partiality on the part of an arbitrator.
When to Decline to Serve?
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