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What is an Arbitration Appeal?

By Christy Bieber
Updated May 23, 2024
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An arbitration appeal is a request made to an appellate court to reconsider the decision of an arbitrator. Arbitration appeals are generally somewhat limited due to the respect given to decisions of arbitrators and arbitration clauses under the law. When an arbitration appeal occurs, the appellate court will look at the process of arbitration and the way in which the rules of law were applied to determine whether the proceeding was fair, but will generally not alter the arbitrator's finding of facts or decision unless impropriety exists.

Arbitration is a form of alternative dispute resolution that has become more popular in the United States legal system in light of the Federal Arbitration Act passed in 1925. When two parties contract or become involved in a business relationship governed by a contractual agreement, many agreements contain clauses requiring that disputes be resolved in arbitration. These arbitration clauses are commonly found in employment law agreements and in the purchase of products such as cellular telephones or other products.

If an arbitration clause exists, the court will not hear a dispute or award a judgment. Instead, the parties will go before an arbitrator or panel of arbitrators. The procedure for how the arbitration will be conducted is normally spelled out in the arbitration clause of the contract. Generally, an impartial third party arbitrator must be used.

The arbitrator will hear the evidence and arguments of both sides. Witnesses may be presented in some circumstances and the procedure may be conducted in a manner similar to a court case. In other situations, the arbitration will be less formal or will follow different procedures. At the end of the case, the arbitrator will make a decision that is binding to both parties.

Each party involved in the arbitration must follow the commands of the arbitrator. If one party believes the process was unfair or the decision was wrong, however, that party may file an arbitration appeal. When filing the arbitration appeal, the party will explain why he believes the decision or arbitration process was not legally fair under the law.

The appellate court will review the request for appeal and will look at the process of arbitration and the behavior of the arbitrator. The court will generally respect the arbitrator's findings of fact. During the arbitration appeal, therefore, the decision of the arbitrator will be overturned only if procedural irregularities exist or if the arbitrator's findings can't possibly be supported given the facts and the applicable law.

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