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Section 144 deals with the rescission of arbitration awards and rulings. Any award may be varied or rescinded by the commissioner who issued the award or by any other commissioner appointed by the Director to do so. A party must apply for rescission.
To vacate an award, the arbitrators must have known of a governing legal principle yet refused to apply it or ignored it, and the law ignored by the arbitrators must be clearly defined.
Further, the CAA provides only limited grounds for judicial review of an arbitration award, such as fraud, corruption, misconduct, or that the award exceeded the arbitrators' powers.
The answer is yes, through a process called vacatur, i.e., having the award vacated or canceled. The vacatur process is set forth in two statutes: the Federal Arbitration Act and the applicable state arbitration act governing the dispute. Depending on the case, one or both statutes may be applicable.
Under federal and state laws, there are only a few ways to challenge an arbitrator's award. The Federal Arbitration Act (“FAA”) and some state laws provide the reasons why an award can be vacated (thrown out), modified (changed), or corrected. Those reasons are very limited in general.
Section 7 of the Federal Arbitration Act (FAA) provides: "Arbitrators ... may summon in writing any person to attend before them ... as a witness and in a proper case to bring with him or them any book, record, document, or paper which may be deemed material as evidence in the case." 9 U.S.C. § 7.
A court may vacate an award only if it finds that one of the limited grounds in the FAA (9 USC section 10) applies, namely: the award is a result of corruption or fraud; there was evident partiality or corruption by an arbitrator; there was arbitrator misconduct; or.
If a party to an arbitration wishes to challenge an award for any reason, they need to make an application to a court except in the rare case where the parties' agreement provides for some type of appellate proceeding within the arbitration.
But, in the absence of an agreement between all parties to end the proceedings, can a claimant unilaterally withdraw from an arbitration that it has commenced? The short answer is yes. No set of institutional rules prevents a party from abandoning claims it has raised in an arbitration.