Friday, September 25, 2009
Confirmation of Arb Award under the FAA: Standard of Review on Appeal
POINTS OF LAW FROM THE DALLAS COURT OF APPEALS: Applicable Standard of Review in Appeals from Confirmation Orders The parties agree the FAA applies to this case. See 9 U.S.C. §§ 1-16 (2009). We review de novo a trial court's confirmation of an arbitration award under the FAA based on the entire record. Myer v. Americo Life, Inc., 232 S.W.3d 401, 407 (Tex. App.-Dallas 2007, no pet.); Tanox, Inc. v. Akin, Gump, Strauss, Hauer & Feld, L.L.P., 105 S.W.3d 244, 250 (Tex. App.-Houston [14th Dist.] 2003, pet. denied). An arbitration award is treated the same as the judgment of a court of last resort. Bailey & Williams v. Westfall, 727 S.W.2d 86, 90 (Tex. App.-Dallas 1987, writ ref'd n.r.e.); see also Quinn v. Nafta Traders, Inc., 257 S.W.3d 795, 798 (Tex. App.-Dallas 2008, pet. granted). All reasonable presumptions are indulged to uphold the arbitrator's decision, and none is indulged against it. Bailey, 727 S.W.2d at 90; see also CVN Group, Inc. v. Delgado, 95 S.W.3d 234, 238 (Tex. 2002). An arbitration award is presumed valid and entitled to great deference. Myer, 232 S.W.3d at 407-08; Crossmark, Inc. v. Hazar, 124 S.W.3d 422, 429 (Tex. App.-Dallas 2004, pet. denied). When reviewing an arbitration award, we may not substitute our judgment merely because we would have reached a different decision. Bailey, 727 S.W.2d at 90; see also CVN Group, Inc., 95 S.W.3d at 238. Judicial review of an arbitration award adds expense and delay and thereby diminishes the benefits of arbitration as an efficient, economical system for resolving disputes. CVN Group, Inc., 95 S.W.3d at 238; Crossmark, 124 S.W.3d at 429. Accordingly, our review of the arbitration award is “extraordinarily narrow.” Myer, 232 S.W.3d at 408; see also Statewide Remodeling, Inc. v. Williams, 244 S.W.3d 564, 568 (Tex. App.-Dallas 2008, no pet.); Tanox,105 S.W.3d at 250. Importantly, our review is so limited that we may not vacate an award even if it is based upon a mistake in law or fact. Crossmark, 124 S.W.3d at 429 (citing Anzilotti v. Gene D. Liggin, Inc., 899 S.W.2d 264, 266 (Tex. App.-Houston [14th Dist.] 1995, no writ)). Because of the deference given to arbitration awards, judicial scrutiny focuses on the integrity of the process, not the propriety of the result. TUCO Inc. v. Burlington N. R.R. Co., 912 S.W.2d 311, 315 (Tex. App.-Amarillo 1995), modified on other grounds, 960 S.W.2d 629 (Tex. 1997). SOURCE: Ancor Holdings, LLC v. Peterson, Goldman & Villani, Inc., No. 05-08-00739-CV (Tex.App.- Dallas, Aug. 25, 2009) ("We conclude the statutory grounds are the exclusive grounds for vacating or modifying an arbitration award under the FAA. Because Ancor has failed to establish any statutory grounds for vacating the arbitration award, it must be confirmed. In addition, because the trial court erred in omitting PGV's award for its share of the arbitration costs from the judgment, we modify the trial court's judgment to conform with the arbitrator's award in that regard. We affirm the trial court's judgment as modified.") Also see: Grounds for vacature of arbitration award under the FAA after U.S. Supreme Court's decisions in Hall St. Assocs., L.L.C. v. Mattel, Inc., 128 S. Ct. 1396 (2008).