Originally from Law and Practice of Arbitration - 4th Edition

Preview Page

1. The Decisional Edifice on Arbitration

The U.S. Supreme Court has expressed a strong interest in promoting party recourse to arbitration and protecting the autonomy and operation of the arbitral process. The Court's interest in arbitration has generated a large number of rulings (some forty-five high court opinions)--the type and number of pronouncements usually reserved for issues of substantial political significance. To borrow a phrase from Justice O'Connor, the Court, in effect, has built its own edifice of arbitration law.1 The Court's rulings have modified substantially the express language and stated purpose of the FAA.

The Court has repeatedly emphasized the importance of contract principles in the U.S. law of arbitration, stating in various cases that "[a]rbitration under the Act is a matter of consent, not coercion. . . ."3 As a result, the provisions contained in an arbitration agreement have the force of law for the parties' transaction. Parties can even reverse the effect of federalization by providing in their agreement for the application of a state law to their arbitration, even though the transaction involves interstate commerce and the state law contains provisions that conflict with the FAA's position on the recourse to arbitration. The reference to state law is effective as long as the parties expressly recognize the chosen law's disabling impact upon their agreement to arbitrate.