Louisiana Bar: Proposed arbitration award legislation, SB 451, 'is a bad bill'

By Karen Kidd | May 19, 2016

BATON ROUGE – The Louisiana State Bar Association clearly opposes state Senate Bill 451, scheduled to be heard before a House committee on Monday, which would change the state's arbitration awards law.

What isn't as clear is why the Louisiana State Bar opposes the judicial treatment of the arbitration awards bill.

In April, the Louisiana State Bar Association released a list of almost 40 pieces of state legislation it is tracking, a list that includes SB 451. Every other piece of legislation on the list includes an explanation of why the bar opposes or supports a bill. For SB 451, the only note is, "The bar noted that this is a bad bill."

Some additional explanation was provided by Louisiana State Bar Association Communications Director Kelly Ponder in an email to the Louisiana Record.

"The LSBA Board of Governors accepted the LSBA’s Legislative Committee’s recommendation to oppose the bill," Ponder said. "The passage of the bill would make LA arbitration law inconsistent with federal law, leading to litigation and thus frustrating the whole purpose of arbitration."

The formal first few lines of the bill reads, "To amend and reenact R.S. 9:4276(A)(2), relative to arbitration; to provide certain terms, conditions, exceptions, requirements, definitions, and procedures; to provide that the recognition or enforcement of an arbitral award may be refused if the award is contrary to law; and to provide for related matters."

SB 451 would make some slight but important language changes to the grounds for which an arbitral award may be refused or enforced, regardless of the country in which the award is made, and adds grounds for which the award may be refused. Under present law, such an award can be refused if a court finds the subject matter under dispute can't be settled in arbitration, or if recognition or enforcement of such an award would be contrary to Louisiana's public policy.

SB 451 would re-enforce the present law's language to say a court may refuse an arbitration award if either of those findings is true, but adds a third provision for an arbitration award that is contrary to the law.

The bill, sponsored by Sen. Rick Ward III (R-District 17), was introduced into the Senate on  April 5 where it was referred to Committee on Judiciary A. The bill came up for Senate vote on May 3 where it passed unanimously with 37 yeas and 0 nays. Sen. Jack Donahue (R-District 11) and Sen. Wesley T. Bishop (D-District 4) were absent from the vote.

Once it passed in the Senate, the bill was passed to the House, where it was referred to the House Committee on Civil Law and Procedure. The resolution had been scheduled for hearing on Monday, but now is one of seven pieces of legislation scheduled to be heard beginning at 10 a.m. May 23, in Committee Room 4.

If the bill passes the House unchanged, it would have to be signed by the governor before it would become law.

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