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Arbitrator's non-disclosure was OK
February 11, 2006 by Ross Runkel at LawMemo
Must an arbitrator disclose that he is on a permanent panel?
The City of North Las Vegas and the North Las Vegas Police Officers Association selected an arbitrator under FMCS rules. The arbitrator did not disclose that he was on a permanent panel under the collective bargaining agreement between the Las Vegas Metropolitan Police Department and the Las Vegas Metropolitan Police Department.
The losing parties in the arbitrations sued to vacate the awards, the trial court did vacate the awards, but the Nevada Supreme Court reversed. Thomas v. City of North Las Vegas (Nevada 02/09/2006).
FMCS rules govern. The parties agreed to arbitrate under FMCS Rules. Therefore, the court used the FMCS disclosure rules and did not apply the state statute on arbitrators' disclosure obligations. The FMCS uses the Code of Professional Responsibility for Arbitrators of Labor-Management Disputes (originally a joint effort of the National Academy of Arbitrators (NAA), American Arbitration Association (AAA), and FMCS).
http://www.naarb.org/code.html
National Academy of Arbitrators Opinion. The court relied on a 1991 Advisory Opinion promulgated by the NAA. In that case an arbitrator was hearing a case between an employer and Union A, and the arbitrator did not disclose that the arbitrator regularly served as an expedited arbitrator in cases between the same employer and Union B. The NAA opinion held that disclosure was not required. Quoting NAA Opinion 22:
Previous or current service as a neutral arbitrator for a particular employer and/or union is not a relationship requiring disclosure under the Code. Absent some personal relationship or other special circumstance mandating disclosure, such service is not a "circumstance ... which might reasonably raise a question as to the arbitrator's impartiality.
My view:
- Certainly the correct outcome.
- Extremely interesting that the court cited Chevron U.S.A. v. Natural Resources Defense Council, 467 US 837 (1984) (courts give deference to administrative agencies' interpretations of statutes), and said that the NAA's "Opinion 22 is the equivalent of an agency interpretation of the FMCS guidelines." Wow, they gave Chevron deference to the opinion of a non-profit private organization.
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