University of Notre Dame (USA) in England v. TJAC Waterloo, LLC, No. 16-1397 (1st Cir. 2017)Annotate this Case
A final determination of liability but not damages in arbitration can satisfy the final requirement of Article V(1)(e) of the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards when the parties have agreed to submit the issue of liability to the arbitrator for a distinct determination prior to a separate proceeding to assess damages.
At issue in this appeal was the district court’s judicial recognition of an English arbitrator’s determination of joint contract liability against the seller and the renovator of a building. The parties agreed to bifurcate litigation of the liability and damages issues. Accordingly, the district court treated the liability judgment, which was decided before the damages issues, as final and thus entitled to judicial recognition. Specifically, the district court held the contractor for the renovation work bound as a party to the agreement providing for arbitration of disputes. The renovator and contractor appealed, claiming that the arbitrator’s judgment of liability in the bifurcated arbitration proceeding lacked the finality required for judicial confirmation of a foreign arbitral award under 9 U.S.C. 207. The First Circuit affirmed, holding that the arbitrator’s liability judgment was final in this instance and that the contractor could indeed be subjected to arbitration.