Jurisdiction(s):
United Kingdom

US Eleventh Circuit: FAA Chapter 1 vacatur grounds apply to New York Convention awards; tribunal did not exceed powers—Hidroelectrica Santa Rita v Corporacion AIC SA

Published on: 30 October 2024

Published by a LexisNexis Arbitration expert

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Article summary

HIDROELECTRICA SANTA RITA S.A., a Guatemalan company, Petitioner-Appellee, versus CORPORACION AIC, SA, D.C. Docket No. 1:21-cv-23807-RNS

What are the practical implications of this case?

In an earlier ruling in this matter, the Eleventh Circuit set aside its own prior authority to align with other Circuits, expressly determining that the domestic law articulated in Chapter 1 of the FAA operates as a gap‑filler in this context and supplies the vacatur grounds for an international arbitration award otherwise regulated by Chapter 2. One such Chapter 1 ground permits vacatur where arbitrators act beyond their authority and exceed their powers. This judgment, which endorses the District Court’s subsequent conclusion that the tribunal did not exceed its remit, reaffirms the steep threshold that must be met before a court will set aside an award on that ground, and offers concrete illustrations of when arbitral tribunals—though arguably mistaken—will not be displaced if they are shown to have attempted to interpret or apply the contract in practice.

What was the background?...

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