Many arbitration provisions expressly or. impliedly, grant to the arbitrator the power to order interim relief pending a final determination of the matter subject to mandatory arbitration. There is a practical reason to expressly eliminate the arbitrator’s power to grant such interim relief and require such decisions to be submitted to a Court.

In Charlotte Kirk v. Brett Ratner, the California Second District Court of Appeal was confronted with an interim decision of an arbitrator to grant a preliminary injunction to prevent breach of a confidentiality provision in a settlement agreement that contained a mandatory arbitration provision. The dispute reached the Appellate Court after the enjoined parties petitioned the Superior Court to vacate the preliminary injunction. The Superior Court ruled that it lacked jurisdiction to consider the matter and dismissed the petition. The enjoined parties then appealed the dismissal of their petition for lack of jurisdiction.

The Court of Appeals concluded that the order of the Superior Court dismissing the enjoined parties’ petition was not appealable. The Appellate Court found the arbitrator’s ruling granting a preliminary injunction was not an award within the meaning of the California Rules of Court Rule 1283.4 that would give the Superior Court jurisdiction to consider the petition and the order dismissing the petition lacked the finality required for it to be appealable. The Court of Appeal expressly determined, as a matter of California law, interim rulings by an arbitrator are not reviewable until the final award is entered.

By leaving interim relief to an arbitrator parties may be leaving them without recourse should they believe the arbitrator’s interim order is in error. Since interim relief, such as preliminary injunctions, attachment and freezing of assets, can effectively ruin a party even if they ultimately prevail, before you agree to an arbitration provision in an agreement or an arbitration agreement, consult with qualified counsel. The contents of the provision or agreement can make all the difference in the event a dispute has to be resolved under their terms.

The information presented is not intended to be, and does not constitute, “legal advice.” Because each situation varies, and only brief summary information is provided here, you should not use this information as a basis for action unless you have independently verified with your own counsel that it applies to your particular situation.