USA Law and Practice Contributed by: Jason W. Myatt, Ankita Ritwik and Charline Yim, Gibson, Dunn & Crutcher LLP
Although uncommon, certain courts also recognise “manifest disregard of the law” as a non-enumerated ground for vacatur under the FAA. Notably, domestic vacatur or set-aside proceedings must be brought with 90 days of notification of the award, which is substantially shorter than the 12-month period appli - cable to actions to confirm such awards. ICSID awards are not subject to set-aside proceed - ings on the above grounds, and a party seeking to vacate an ICSID award may pursue annulment pro - ceedings under the ICSID Convention and ICSID Arbi - tration Rules. The grounds for annulment of an ICSID award are narrow, and limited to the following: (i) that the Tribunal was not properly constituted; (ii) that the Tribunal has manifestly exceeded its powers; (iii) that there was corruption on the part of a member of the Tribunal; (iv) that there has been a serious departure from a fundamental rule of procedure; or (v) that the award has failed to state the reasons on which it is based (ICSID Convention, Art. 52 (1)). 4.4 Process of Enforcing Arbitral Awards There are two steps to enforcing an arbitral award in the US: (i) recognition and (ii) execution. Recognition Recognition involves converting an arbitral award into a US judgment. The following apply: • domestic awards are governed by Chapter 1 of the FAA; • foreign non-ICSID awards are governed by the New York Convention or Panama Convention pur - suant to Chapters 2 and 3 of the FAA; and • ICSID awards are governed by 22 USC § 1650a. To initiate recognition proceedings, the award-creditor may file a petition before the relevant state or federal court where the award-debtor’s assets are located or where it can otherwise establish jurisdiction. If the award-debtor is a foreign state, the appropriate venue for the petition is generally the DC District Court. Typically, the petition must include an authenticated copy of the arbitral award, the arbitration agreement underlying the award, and, if the original documents are not in English, a certified translation into English.
The petition is also generally accompanied by a short memorandum of law and an attorney affidavit certify - ing that the copies of the documentation provided are true and correct. The award-creditor must also prop - erly serve the petition on the award-debtor. The award-debtor may challenge recognition pro - ceedings (as discussed in 4.6 Challenging Enforce- ment of Arbitral Awards ). Recognition proceedings are typically summary processes, meaning courts will decide on any challenges without trial, and often with - out a hearing, based only on written submissions. If the court confirms the arbitral award, it can enter a money judgment for the amount of the award. Nota - bly, recognition of an award will typically result in a judgment that replaces any post-award interest with the jurisdiction’s applicable post-judgment interest rate from the date of entry of the award until the judg - ment is fully satisfied. Execution A judgment-creditor may take steps to enforce the judgment in any US jurisdiction where the award- debtor has assets. Each state will have its own pro - cedures governing the execution process as set out in 2.2 Enforcement of Domestic Judgments . States will also generally allow discovery in aid of execution, including against third parties, to find and identify attachable assets. 4.5 Costs and Time Taken to Enforce Arbitral Awards The primary cost in enforcing awards is that of legal counsel and, where necessary, discovery. Translation costs can also be significant. The administrative costs are comparatively low. For instance, the current cost to file an action in federal court to request enforce - ment of or set aside an arbitral award is approximately USD400. The time taken for recognition and enforcement pro - ceedings varies by jurisdiction and complexity of the proceedings, among other factors. Generally, recog - nition processes take a year or less but appeals and stays will lengthen that time. Execution will take as long as is required to fully recover the value of the judgment and will depend largely on the type of assets that are to be executed against.
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