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A party cannot avoid the FAA's statute of limitations for petitions to vacate an arbitration award by renaming the petition as one to partially confirm an award and arguing that the court is barred from enforcing certain portions of the award, a federal court in North Dakota held.
In Stedman v. Great American Insurance Co., No. 4:06-cv-101, 2007 WL 1040367 (D. N.D. April 3, 2007), Stedman purchased crop insurance from Great American. When Stedman suffered losses as a result of weather, he filed a claim under this policy with Great American.
However, Great American refused to pay on the claims, arguing that the crops yields claimed by Stedman were not common to the area. When the parties submitted their dispute to arbitration, the arbitrator issued an award in Stedman's favor.
Stedman brought a petition to confirm the award, and Great American answered and counterclaimed with a petition to vacate the award. However, under the Federal Arbitration Act, 9 U.S.C. § 12, the statute of limitations for petitions to vacate, modify or correct an arbitration award must be filed within the three months following the issuance of the award. The arbitrator in this case issued the award over five months before Stedman filed the petition to confirm.
Great American then amended its counterclaim, changing the petition to vacate to a petition to confirm the award – but arguing that the Court was barred from confirming some aspects of the award.
However, this Court held that Great American's renaming of its petition did not change the fact Great American was seeking vacatur of the arbitration award. The original petition to vacate and the amendment petition to confirm asked the court to take the same action. Because the statute of limitations had run for petitions to vacate the award, the Court confirmed the award in Stedman's favor.
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