A Dallas appellate court recently vacated an arbitration award in an employment matter. Alim v. KBR (Kellogg, Brown & Root) – Halliburton, No. 05-09-00395-CV (Tex. App.—Dallas, Jan. 10, 2011), available at http://www.5thcoa.courts.state.tx.us/cgi-bin/as_web.exe?c05topin.ask+D+137543.
An arbitrator issued an award that denied an individual’s employment-related claims. The individual, having learned that the arbitrator did not disclose a prior relationship with the opposing party’s representative, asked a trial court to vacate the arbitration award. The trial court denied this request, and this appeal followed.
Under the Federal Arbitration Act, evident partiality of an arbitrator is a substantive ground for vacating an arbitration award; a neutral arbitrator exhibits evident partiality if he does not disclose facts that might, to an objective observer, create a reasonable impression of the arbitrator’s partiality. Here, the individual argued that the arbitrator failed to disclose that he had served as an arbitrator in a prior case involving the opposing party’s representative and a related company. This relationship was not trivial, and the arbitrator was specifically required to disclose whether a party representative had appeared before him in prior cases. The Court held that the arbitrator’s nondisclosure and his failure to amend his answer to the question specifically inquiring about that fact constituted evident partiality. It vacated the award.
To speak to a Texas employment attorney about employment arbitration or another employment law issue, contact the Texas employment lawyers at Clouse Dunn Khoshbin LLP at [email protected].
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