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Time Incurred During Prior Court Proceedings - What are your thoughts?

Can an arbitrator award counsel fees at the conclusion of an arbitration for time incurred (prior to the arbitration) during prior court proceedings, which resulted in an Order directing the parties to proceed to the arbitration?

Please provide your thoughts/comments below.

Comments (10)

If the arbitration agreement is general and broad and at least implicitly authorizes an award or attorneys' fees, yes.

Arbitration being a creature of contract, it depends on the contract and the contextual background of the law being applied.

In a private, contract-based cause of action, the answer depends on the language of the contract and what it says constitutes a "proceeding" or whatever other term is used in the agreement for what attorney fees can be awarded for.

In a contract based cause of action which is driven by a public policy statute like antidiscrimination statutes, is more likely that the antidiscrimination statute would supersede the contract language since many jurisdictions have adopted the principle that arbitration cannot limit the remedies available to individuals damaged by discriminatory actions.

Steven Certilman:

I would not consider that to be counsel fees in the preceding so my answer would be no. That would not necessarily preclude the possibility of pre-arbitration counsel fees, such as those incurred in connection with a motion to compel, being includable as an element of damages in the arbitration claim.

Absent some specific clause in the rules that allowed it, I would be inclined to keep the costs awarded to a party to those incurred just the arbitration, not beforehand. Otherwise, how far back does one go?

Michael Orfield:

Sounds like a Bar Exam question. Certainly an Appellate Court case.
Atty fees clause will probably tell the tale.
But I do not think fees generated in an attempt to get the case into arbitration are recoverable. They certainly are not recoverable if you attempt and fail. Why would they be recoverable if you attempt and succeed. Either way you are not IN arbitration, just trying to get there.

steve conover:

Arbitration is governed by contract and the parties' submissions. If the contract simply says "prevailing party" recovers "legal fees" without further description or limitation, the Arbitrator should not unilaterally limit the Award to legal fees incurred only in the arbitration proceedings.

I agree with Steven Certilman. If pre-arbitration counsel fees are to be recovered, I think that can be justified only as damages incurred as a result of a party's breach of the arbitration clause in the contract.

Philip Allen Lacovara:

I sometimes have seen clauses that expressly authorize the award of costs of proceedings that are necessary to compel arbitration, which I construe as covering attorney’s fees. That is the easy situation. I also am sympathetic to the argument that, even without an explicit clause on this subject, a party that agrees to arbitrate and then has to be compelled to submit to arbitration implicitly agrees to a “make whole” remedy that would cover the costs of litigation to enforce the contractual duty to arbitrate.

Judge Gerald Harris:

If the pre-arbitration time was spent pursuing non-arbitration goals, eg. bringing a civil action later discontinued in favor of an arbitral forum, then attorneys’ fees would appear to be inappropriate. On the other hand, if the litigation was brought to compel arbitration, and assuming other prerequisites for recovering attorneys’ fees are met, the award of such fees would be appropriate.

Absent express, unambigious language in the arbitration clause, my answer is "no."The question is more interesting if the substantive issues in arise under a statute that permits prevailing party attorneys' fees. In such instances, judicial precedent in the jurisdiction could play a role.

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