A Louisiana appellate court determined that the narrow authority and exclusive nature of the Louisiana statute governing the modification of arbitration awards did not allow it to modify a contractor's arbitration award.

In JK Developments, LLC v. Amtek of Louisiana, Inc., No. 2007 CA 1825, 2008 WL 793600 (La. Ct. App. Mar. 26, 2008), Amtek, a contractor, and JK, a development company, arbitrated a contract dispute. The arbitration award ordered Amtek to pay JK damages for work not completed properly, attorney fees, and interest for a loan taken out by JK to fund Amtek's work.

Amtek objected to the award of attorney fees and interest on the loan. The lower court modified the award in favor of Amtek, vacating the award for attorney fees. However, the lower court declined to modify the award for interest on the loan.

On appeal, Amtek contended that the arbitrators exceeded their powers and that the award of interest on the loan amounted to an evident material miscalculation of figures and, therefore, should be vacated. The Court reviewed Amtek's motion under the very limited framework of Louisiana Revised Statutes 9:4210 and 4211.

The Court noted that Louisiana jurisprudence has applied the state statutes to reflect a strict adherence to the limited authority for judicial modification of arbitration awards. Because of strong policy favoring arbitration, awards are presumed to be valid.

Further, errors of fact or law do not invalidate an otherwise fair arbitration award, such that judges are not entitled to substitute their judgment for that of the arbitrators. There are specific grounds under Louisiana statute which dictate when a court shall vacate an arbitration award.

The Court found none of these statutory situations in Amtek's arguments. The Court noted that Amtek merely cited statutory provisions without making any argument that factually related the arbitrator's conduct and decisions to the provisions.

Amtek's arguments – that JK never made any payments from to loan to Amtek, JK terminated the contract early, and JK failed to mitigate its damages – failed to show that the arbitrators exceeded their power or made a material miscalculation of figures.

The Court stated that under Louisiana statute, the arbitration award was final and definite, and covered the subject matter submitted to arbitration. The Court noted that even if it did disagree with the decision on its merits, the arbitrators did not exceed their powers in this matter.

To hold otherwise would expand the remedy available by statute allowing judicial intervention into arbitration, which effectively would "defeat the purpose of arbitration: the speedy resolution of disputes outside the court system." Firmin v. Garber, 353 So.2d 975, 978 (La. 1977).