Suppose an arbitrator issues an award, and the losing party pays the full amount set forth in the award. May the winning party still ask a court to confirm the arbitration award as a final judgment?
A federal district court in Colorado recently confronted this issue, and the court recognized that “[c]ourts disagree as to whether they may confirm an arbitration award when the party opposing confirmation has already complied with the award in full.” Gorsuch v. Wells Fargo, No. 11-cv-00970 (D. Colo. Aug. 21, 2013) (click here to see a copy of the opinion). Some courts refuse to confirm an arbitration award if the losing party has fully complied with the award because there is no case or controversy. Under this reasoning, a court can only confirm an award if the parties dispute its validity or compliance with the award. However, other courts look at the literal language of section 9 of the FAA and allow confirmation of an award even when the losing party has fully complied with the award. Section 9 provides the following:
If the parties in their agreement have agreed that a judgment of the court shall be entered upon the award made pursuant to the arbitration, … then at any time within one year after the award is made any party to the arbitration may apply to the court so specified for an order confirming the award, and thereupon the court must grant such an order unless the award is vacated, modified, or corrected as prescribed in sections 10 and 11 of this title.
Under a literal reading of section 9, courts must confirm awards “unless the award is vacated, modified, or corrected.” The Colorado district court adopted this literal reading of the FAA and held that parties may seek confirmation of an arbitration award, even where the losing party has fully complied with the award.