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New Delaware Rapid Arbitration Rules Go Into Effect



 

The Delaware Supreme Court has adopted, in consultation with the Court of Chancery, the Delaware Rapid Arbitration Rules to govern arbitration procedures under the recently-enacted Delaware Rapid Arbitration Act (DRAA). The Rules are available on the Delaware State Courts Website.

The Rules set forth the procedures for arbitrations under the DRAA and address, among other things, commencement of an arbitration; the authority of the arbitrator; the scheduling and order of arbitration proceedings; the confidentiality of arbitration proceedings; and the form of a final award.

The parties to an arbitration may agree to modify the Rules or adopt additional rules, so long as the arbitrator consents and the modifications are not inconsistent with the DRAA. The Delaware Supreme Court may amend the Rules at any time.
The DRAA offers fast, efficient dispute resolution

Delaware’s Rapid Arbitration Act became effective on May 4 of 2015, and provides sophisticated parties with speedy and private resolution of their disputes.

Under the DRAA, arbitrations must be completed within 120 days of the arbitrator accepting appointment. That timeline can be extended to 180 days, but only with the unanimous consent of the parties and the arbitrator. Arbitrators who do not issue final awards within the prescribed timeframe face reductions in their fees corresponding to the length of the delay.

The new legislation gives arbitrators broad powers. The arbitrator determines whether a dispute can be resolved through arbitration, and may grant injunctions and related remedies. The arbitrator’s final award is deemed confirmed simply by the passage of time.

Challenges to the final award are made directly to the Delaware Supreme Court, skipping review by a trial court. Challenges are reviewed according to the narrow Federal Arbitration Act standard of review, unless otherwise indicated in the contract.

The DRAA may only be invoked by business entities which have agreed in writing to submit their disputes to be resolved under the DRAA.  One of the business entities must be formed under Delaware law but need not be physically located in Delaware.

For more information about DRAA, please take a look at our blog posts on this topic which can be found here. We also encourage you to review The Practitioner’s Guide to the Delaware Rapid Arbitration Act, a comprehensive resource to help attorneys understand the DRAA. To download an electronic copy of the book, read frequently asked questions about the DRAA, and obtain forms and petitions, visit http://www.rlf.com/DRAA.

 

 

 


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