Let’s start this one with a hypothetical. A divorce action has been filed against you by your spouse. A very important court date is coming up regarding the children and somehow you find yourself in Bais Din. You are swept up in a mediation trying to settle your case, with the court date looming ahead of you. You are constantly told, settle or else the court will ultimately give you less time with your children. You are warned: court is the worst place you could possibly be.

You manage to resolve some issues, but you can’t decide on some holiday parenting time. A document is put in front of you: it’s an Agreement to Arbitrate giving the Bais Din the ability to make decisions about custody and parenting time. You don’t have a lawyer present, but your Toen is there. Everyone says to just sign it. Deal with the fallout later.

You think to yourself: I’m just going to enter into this Agreement to Arbitrate and if I don’t like the Bais Din or its decisions, I can always go to Court. Not so!

I’m not going to bury the lead on this one. DO NOT ENTER INTO AN AGREEMENT TO ARBITRATE IN THE BAIS DIN WITH INTENTIONS TO EVENTUALLY SET ASIDE THE AGREEMENT TO ARBITRATE OR THE BAIS DIN’S DECISIONS.

Do not be fooled. It is extremely difficult to set aside an Agreement to Arbitrate, or an Arbitration decision in general.

However, there are several arguments that might be available, although difficult to prevail on. I’ll start with a discussion of setting aside an Agreement to Arbitrate due to procedural reasons.

A litigant could argue procedural insufficiency of the Agreement to Arbitrate itself. As discussed in a prior post, the Arbitrator/Umpire Questionnaire is a mandatory component of any Agreement to Arbitrate in New Jersey pursuant to Rule 5:1-4.

Such disclosure is critical as it answers questions relative to a Bais Din’s relationships, with particular reference to the following unanswered questions:

Do you have any financial or personal interest in the outcome of this arbitration/alternate dispute resolution proceeding?

Do you have any existing or past financial, business, professional, family or social relationships which are likely to affect your impartiality in this arbitration/alternate dispute resolution proceeding or which might reasonably create an appearance of partiality or bias?

Does your spouse, minor child(ren) residing in your household, your current employer, partner(s) or business associate(s) have any existing or past financial, business, professional, family or social relationships which are likely to affect your impartiality in this arbitration/alternate dispute resolution proceeding or which might reasonably create an appearance of partiality or bias?

Have you had any professional or social relationship with counsel for any party in this proceeding or the firms for which they work?

Have you had any professional or social relationship with any parties or witnesses identified to date in this proceeding or the entities for which they work?

Have you or your law firm had any professional or social relationship of which you are aware with any relative of any of the parties to this proceeding, or any relative of counsel to this proceeding, or any of the witnesses identified to date in the proceeding?

Have any of the party representatives, law firms or parties appeared before you in past arbitration/alternate dispute resolution proceedings?

Are there any connections, direct or indirect, with any of the case participants that have not been covered by the above questions?

 The corollary to this Court Rule is found in the New Jersey Arbitration Act, N.J.S.A. 2A:23B–12a, which establishes a duty of reasonable inquiry and provides:

Before accepting appointment, an individual who is requested to serve as an arbitrator, after making a reasonable inquiry, shall disclose to all parties to the agreement to arbitrate and [sic] arbitration proceeding and to any other arbitrators any known facts that a reasonable person would consider likely to affect the impartiality of the arbitrator in the arbitration proceeding, including:

(1) a financial or personal interest in the outcome of the arbitration proceeding; and

(2) an existing or past relationship with any of the parties to the agreement to arbitrate or the arbitration proceeding, their counsel or representatives, a witness, or other arbitrators.

[Emphasis supplied.]

The language in the New Jersey Act is ostensibly identical to that contained in the Uniform Act of 2000, Uniform Arbitration Act (U.L.A.) § 12(a). Each act permits an award to be vacated if the mandated disclosure is not made. SeeN.J.S.A. 2A:23B–12d; Uniform Arbitration Act § 12(d).

A Comment to the Uniform Arbitration Act describes “reasonable inquiry” the must be made by an arbitrator prior to accepting an appointment as follows:

Section 12(a) requires an arbitrator to make a “reasonable inquiry” prior to accepting an appointment as to any potential conflict of interests. The extent of this inquiry may depend upon the circumstances of the situation and the custom in the particular industry. For instance, an attorney in a law firm may be required to check with other attorneys in the firm to determine if acceptance of an appointment as an arbitrator would result in a conflict of interest on the part of that attorney because of representation by an attorney in the same law firm of one of the parties in another matter.

Once an arbitrator has made a “reasonable inquiry” as required by Section 12(a) the arbitrator will be required to disclose “known facts” that might affect impartiality. The term “knowledge” (which is intended to include “known”) is defined in Section 1(4) to mean “actual knowledge.”

Failure to make these inquiries and disclosures could prove fatal for an Agreement to Arbitrate. If no disclosures are made, it could prevent a party to the Agreement from being able to vet the extent of prior involvement of the Bais Dinwith the parties’ respective counsel, including, but not limited to, how many cases in which counsel has been involved in with the Bais Din on a yearly basis and if referrals are granted to them; any pecuniary interest the Bais Din may prior involvement/relationships with third parties to the case including experts, advisors, Rabbis and witnesses who have been and continue to be involved in a matter.

So, if you feel you’ve been deprived of an opportunity to appropriately consider the involvement of the Bais Din and/or Dayanim in your matter, an application could be made to the court to set aside the entire Agreement to Arbitrate. This would likely bring you into a court proceeding, where you would be subject to the decisions of a judge instead of an arbitrator.

Consider your options and reach out to an attorney well versed in these subjects to determine if you may have a viable argument.

Next, I’ll begin a discussion regarding setting aside an Agreement to Arbitrate for more substantive reasons, like duress, unconscionability, and failure to consult with counsel.

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