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. Renfros 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 Panels 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 its still an Award!) (SAC Ref. No. 2001-46-01)
Copyright 2000-2002 Securities Arbitration Commentator, Inc. P.O. Box 112, Maplewood, NJ 07040; t: 973-761-5880 f: 973-761-1504. Materials denoted with a SAC Reference No. (e.g. SAC Ref. No. 99-01-001) are on hand at SAC and may be obtained by calling the Securities Arbitration Commentator, or by email to email@example.com. The Securities Arbitration Commentator is the leading publication for securities arbitration news and information, and maintains the most complete database of arbitration awards availalble anywhere. For more information regarding their services, visit their website at www.sacarbitration.com
Nothing herein is intended as legal or financial advice. The law is different in different jurisdictions, and the facts of a particular matter can change the application of the law. Please consult an attorney or your financial advisor before acting upon the information contained in this article.
Need help with a securities law issue? Call New York Securities Lawyer at 212-509-6544 or visit the website. Representing investors and advisers across the country for over 30 years.
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.