The District of Columbia Court of Appeals has held that remanding a matter for arbitral clarification is proper, but remanding for an arbitral rehearing on the issues is improper.

In Williams v. Richey, No. 03-CV-1099, 2008 WL 2199211 (D.C. May 29, 2008), Williams and Richey agreed to dissolve a general partnership. The dissolution required that asset distribution would be resolved through arbitration. The arbitrator ultimately issued an award, requiring adjustments to each party's "capital accounts" as the basis for the distribution amounts.

Upon a petition for confirmation of the award, the parties expressed disagreement over the method used to calculate those adjustments and over entitlement to attorney's fees. The trial court asked for clarification of these issues from the arbitrator. After considering the arbitrator's response, the court distributed the assets in accordance with the arbitration award and also awarded one party attorney's fees out of Williams' funds.

The Court first clarified that the trial court possessed the authority to seek clarification of the arbitration award. The Court was careful to distinguish an order for rehearing by the arbitrator from an order for clarification of an award. Compare Am. Postal Workers Union, AFL-CIO v. U.S. Postal Service, 254 F.Supp.2d 12, 15 (D.D.C. 2003) (holding that "remand[ing] to clarify an ambiguity does not run afoul of the… functus officio doctrine") with Jaffe v. Nocera, 493 A.2d 1003, 1007 (D.C. 1985) (holding that a rehearing of an issue not originally put before the arbitrators was inappropriate). The Court declared that only the clarification of the arbitrator's decisions, as requested here, was appropriate.

The Court found the trial court's order granting attorney's fees from Williams' share of the partnership assets was improper. The contractual provision in the partnership agreement stated that partners were immune from liability to another partner for actions in connection with the partnership unless there was "actual fraud, gross negligence, or dishonest conduct." The Court found this to be immunity from liability save certain forfeiting circumstances and that it clearly did not authorize a court to award attorney's fees.

Furthermore, absent a party acting "in bad faith, vexatiously, wantonly, or for oppressive reasons," the trial court could not exercise its inherent authority to award attorney's fees as a sanction. With no contractual or extra-contractual grounds to impose this sanction, the trial court's award of fees was improper.

The Court also decided to remand the issue of the particular distributions to the trial court for further fact-finding as to the amount in each party's capital account in the time between the arbitration proceedings and the trial court action.