LD 1218
pg. 52
Page 51 of 94 An Act To Enact the Revised Uniform Arbitration Act Page 53 of 94
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LR 468
Item 1

 
an action against one of the parties for nonpayment of fees to
the arbitrator and may have to give testimony in order to
recover. If, in an action by the arbitrator to recover a fee,
the other party files a counterclaim against the arbitrator
attacking the award, this section is intended to allow the
arbitrator to testify as to the arbitrator's claim, but the
arbitrator cannot be required to testify or produce records as
to the party's counterclaim attacking the merits of the award.
Otherwise the party can circumvent the general rule against
requiring an arbitrator to provide testimony by forcing an
action by the arbitrator by, for instance, not paying a
contractually required fee for the arbitrator's services.

 
Section 14(d)(2) recognizes that arbitrators who have engaged
in corruption, fraud, partiality or other misconduct that are
grounds to vacate an award under Sections 23(a)(1) and (2) may
be required to give testimony so that a party will have
evidence to prove such grounds. Such testimony or records from
an arbitrator are only required after the objecting party
makes a sufficient initial showing that such grounds exist.
See Carolina-Virginia Fashion Exhibitors Inc. v. Gunter, 291
N.C. 208, 230 S.E.2d 380, 388 (1976) (holding that where there
is objective basis to believe that arbitrator misconduct has
occurred, deposition of the arbitrator may be permitted and
the deposition admitted in action for vacatur). A party's
allegation of these grounds without a showing of independent,
objective evidence should be insufficient to require an
arbitrator to testify or produce records from the arbitration
proceeding.

 
6. Section 14(e) is intended to promote arbitral immunity.
By definition, almost all suits against arbitrators,
arbitration organizations, or representatives of an
arbitration organization arising out of the good-faith
discharge of arbitral powers are frivolous because of the
breadth of their respective immunity. Spurious lawsuits
against arbitrators, arbitration organizations, and
representatives of an arbitration organization or involvement
in collateral judicial or administrative proceedings deter
individuals and entities from serving in such capacities and
thereby harm the arbitration process because of the costs
involved in defending even frivolous actions. Parties
considering such litigation should be discouraged by the
prospect of paying the litigation expenses of the arbitrator,
arbitration organizations, or representatives of an
arbitration organization. When they are not, the statute
enables the arbitrators, arbitration organizations, or
representatives of an arbitration organization to recover
their litigation expenses and not to lose their fee and incur
other expenses in the defense of a frivolous lawsuit. The
terms
"other reasonable expenses of litigation" are intended to
include both actions at the trial-court level and on appeal.


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