Can you seek punitive damages in arbitration?

Asked by: Dr. Holden Luettgen  |  Last update: June 24, 2025
Score: 4.2/5 (72 votes)

The parties' rules may dictate whether an arbitrator can award punitive damages. Although rare, parties may include in their arbitration clause express wording allowing (or disallowing) punitive damages. Likewise, most arbitral institutional rules are silent on remedies.

Can you ask for punitive damages in arbitration?

Today, in most cases, arbitrators have the power to award punitive damages, but the expansion of an arbitrator's power in this area may be part of the rationale for the demise of the arbitration system as we know it.

Can you seek damages in arbitration?

While monetary damages are most often awarded, arbitrators frequently award equitable and other forms of relief, including specific performance, injunctive relief, consequential damages, liquidated damages, attorneys' fees and punitive damages.

What damages are awarded in arbitration?

In determining damages, arbitration tribunals should be able to ascertain an appropriate level of damages based on such evidence as the parties' negotiations, their prior course of dealing and the course of performance under the contract, as well as the extent to which the respondent knew and understood the ...

Can you ask for punitive damages?

Punitive damages are awarded punish a defendant for malicious conduct (such as drunk driving). Punitive damages are not available in all cases. You must request punitive damages when you file your lawsuit.

Can I still win punitive damages if my discrimination or sexual harassment case goes to arbitration?

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How do you justify punitive damages?

The deterrence justification for punitive damages is motivated by two objectives: (1) to deter the specific defendant in the case from repeating or continuing his, her, or its offensive behavior and (2) to deter, generally, other potential parties from committing similar offenses.

Can you ask for punitive damages in mediation?

Punitive damages are actually awarded and retained in a very small portion of cases. Nonetheless, it is not uncommon for opening demands in mediation to include claims for punitive damages to see what the insurance company is going to do.

What voids an arbitration?

As a general rule, only strong evidence of duress or fraud are sufficient to invalidate an arbitration clause. It is worth noting that many state courts will to set aside arbitration agreements where the parties have vastly disparate bargaining power (such as between employers and employees).

Can you recover costs in arbitration?

For the costs you do pay, you can request that the arbitrator award you those costs as part of his or her Final Award. This means that you are requesting the arbitrator to direct the other party to pay you back for those costs.

What is capable of settlement by arbitration?

Arbitrability indicates whether a dispute is “arbitrable”, i.e. capable of being settled by arbitration. Although arbitration is a private proceeding, the recognition and enforcement of a particular award may have an impact on any States involved.

Is it better to settle or go to arbitration?

In most cases, arbitration tends to be more cost-effective. While arbitrator's fees can be significant, the overall expenses are generally lower because of limited discovery and quicker resolution.

What matters are not allowed in arbitration?

1 of Act 49 of 1996.] A reference to arbitration shall not be permissible in respect of- (a) any matrimonial cause or any matter incidental to any such cause; or (b) any matter relating to status.

Can AAA arbitrators always award punitive damages?

They provide simply that “[t]he arbitrator may grant any remedy or relief that the arbitrator deems just and equitable and within the scope of the agreement of the parties.” (AAA Commercial Arbitration Rules rule R-43 [a].) New York law does not permit arbitrators to award punitive damages.

What evidence is needed for punitive damages?

In most jurisdictions, punitive damages apply when the defendant's actions exhibit an intentional disregard for the rights and safety of others or involve intentional misconduct. Your lawyer will establish that the defendant's behavior meets these legal standards through compelling evidence and persuasive arguments.

Can you sue for damages in arbitration?

In some instances, you may be able to sue if you signed a valid arbitration agreement. While courts generally favor arbitration agreements, they will allow you to file a lawsuit if either you didn't understand your rights or your claims fall outside the arbitration provision's scope.

Are punitive damages not allowed in contract actions?

The majority of American jurisdictions do not allow punitive damages for breach of contract unless the breach constitutes an independent tort.

What Cannot be solved by arbitration?

Generally, disputes in rem which are regarding a thing or property can't be resolved through arbitration, while disputes in personam regarding a selected person are often.

What if you can't afford arbitration?

After a party is compelled into arbitration by court order and is unable to pay the arbitrator fees, upon return to court, cases have held the matter can proceed in trial and/or the other party can pay the arbitrator fees.

Who pays the costs of arbitration?

In the final award the arbitral tribunal shall decide which of the parties shall bear the costs of the arbitration fixed by the Court or in what proportion they shall be borne by the parties.

How to beat an arbitration agreement?

How to Protect Yourself Against Forced Arbitration
  1. Look for arbitration language. Information regarding forced arbitration is usually buried in the company's terms of use or legal terms and conditions. ...
  2. Opt-out when you can. ...
  3. Submit official complaints. ...
  4. Negotiating using the legal leverage you have.

Can you lose in arbitration?

If you lose the case, it's very hard to challenge a decision the arbitrator has made. You can't appeal if you simply disagree with the decision. If you think the case wasn't handled properly, you should get advice about what to do next. You may be able to make an appeal to court on a point of law.

What makes arbitration unenforceable?

This law provides that arbitration agreements are generally valid and enforceable. The major exception to this provision is that the arbitration agreement is not enforceable if it violates the general law of contracts – which applies to all contracts under the law of the state that governs the agreement.

Can you get punitive damages in arbitration?

In Garrity v Lyle Stuart, Inc., the New York Court of Appeals held that an “arbitrator has no power to award punitive damages, even if agreed upon by the parties.

Is emotional distress punitive damages?

For example, if a hospital failed to obtain informed consent from a patient for a medical procedure and the patient suffered severe personal injury or emotional distress as a result, punitive damages may be awarded in addition to other compensatory damages such as hospital bills and lost wages.

Can the EEOC award punitive damages?

Remedies May Include Compensatory & Punitive Damages

Compensatory and punitive damages may be awarded in cases involving intentional discrimination based on a person's race, color, national origin, sex (including pregnancy, gender identity, and sexual orientation), religion, disability, or genetic information.