Preemption: The United States Arbitration Act, the Manifest Disregard of the Law Test for Vacating an Arbitration Award, and State Courts

Abstract

The purpose of this Article is to examine the question of whether state courts are required by the USAA to apply the manifest disregard of the law test to a motion to vacate an arbitration award. The answer to that question appears to be "no" because the principal preemptive effect of the USAA is to insure that arbitration agreements are enforced in state and federal courts. Moreover, the manifest disregard of the law doctrine does not find its basis in the USAA; rather, it is a creature of federal common law. Further, sections 10 and 12 of the USAA permit for an arbitration award to be vacated under specified circumstances, and these provisions, by their very terms, apply only in federal courts.6 Hence, the USAA cannot be read as requiring state court judges to set aside an arbitration award when there has been a manifest disregard of the law by an arbitrator. State courts and legislatures can adopt such a rule, but state court judges are not required to apply the manifest disregard of the law rule because of the USAA.