Law Commons^™

Should Parties’ Disclosure Requirements For Arbitrators Be Honored By Courts: Positivesoftware Solutions, Inc. V. New Century Mortgage Corporation, Leonard E. Gross, Howard L. Wieder

Leonard E. Gross

In this article, we criticize the decision of the Fifth Circuit Court of Appeals in PositiveSoftware Solutions, Inc. v. New Century Mortgage Corporation. In PositiveSoftware, the court confirmed an arbitration award even though the arbitrator had failed to disclose rather significant facts about his relationship to one of the parties. Our thesis is that courts should enforce the arbitrator disclosure requirements to which the parties have agreed by not confirming arbitration awards when arbitrators fail to comply with those disclosure requirements. In adopting the Federal Arbitration Act, Congress intended to encourage the use of arbitration. The net effect of refusing …