Time To Vacate Runs on Imperfect Award

 Imperfect Form of Award Does not Make it Less Final 

Renfro vs. Dean Witter Reynolds, Inc., 2001 US App. LEXIS 24438 (3rd Cir. 10/5/01)

Renfro v. Dean Witter Reynolds, Inc., 2001 U.S. App. LEXIS 24438 (3rd Cir., 10/5/01): That an Award is imperfect as to form or contains mistakes will not prevent the running of the 90-day time limit for vacatur motions.

In this case, NASD issued a letter ruling in April 1997, signed by a staff attorney on behalf of the Arbitration Panel, informing Mr. Renfro that his claims against Dean Witter were dismissed with prejudice on motion by Dean Witter, as a result of his failure to appear at the scheduled initial hearing. The letter was sent to an address provided by Mr. Renfro’s former counsel, but Mr. Renfro did not react to the decision until November 1997.

Since the district court made a finding that Mr. Renfro knew of the dismissal no later than July 30, 1997, it refused to consider his motion to vacate.

Section 12 of the Federal Arbitration Act provides 90 days from the date of delivery to challenge an arbitration Award and, even with the most generous reading, three months and 17 days passed before Mr. Renfro acted. The Court of Appeals affirms the untimeliness ruling.

One of the defenses raised by Appellant charged that the NASD, by issuing a letter ruling that did not have Arbitrator signatures, had not rendered an “Award” and, therefore, the time limitation in Section 12 was never triggered. The Court responds that Rule 10330 allows for the Award to be signed by a majority of the Arbitrators “or in such a manner as is required by applicable law.” This ruling clearly reflects the Panel’s intention “to resolve all of the submitted claims and issue a final award.” That it does not look like an Award is immaterial. To find otherwise would mean “the running of the limitations period prescribed in FAA §12 could be postponed or suspended indefinitely. In the process, the ‘finality’ test applicable to arbitral awards would be severely undermined, along with the central purpose served by arbitration proceedings.” (SAC Ed: These letter rulings, disposing of all claims against a party or in a case are clearly Awards in our view and should be part of the Public Award program. Not putting the dispositive decision in the standard form of an Award may fool the staff into thinking there is no Award to be made publicly available, but, as the Court indicates here, writing a letter does not change the character of the instrument – it’s still an Award!) (SAC Ref. No. 2001-46-01)


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Securities Attorney at Sallah Astarita & Cox | 212-509-6544 | mja@sallahlaw.com | Website | + posts

Mark Astarita is a nationally recognized securities attorney, who represents investors, financial professionals and firms in securities litigation, arbitration and regulatory matters, including SEC and FINRA investigations and enforcement proceedings.

He is a partner in the national securities law firm Sallah Astarita & Cox, LLC, and the founder of The Securities Law Home Page - SECLaw.com, which was one of the first legal topic sites on the Internet. It went online in 1995 and is updated daily with news, commentary and securities law related links.