Many couples facing a Texas divorce seek alternative dispute resolutions, such as arbitration or mediation. Parties to an arbitration are entitled to an impartial arbitrator. The Texas Arbitration Act requires a court to vacate an arbitration award on the application of a party if that party’s rights were prejudiced by “evident partiality” of an arbitrator. The award should be vacated if the arbitrator does not disclose information that might give an objective observer a reasonable impression that the arbitrator is partial. The requirement to disclose applies whether the conflict arises before or during the proceedings. The nondisclosure itself establishes evident partiality, regardless of whether there is actual partiality or bias. Texas courts have acknowledged that extensive experience in the area of law related to the dispute will result in a need for the arbitrator to disclose prior dealings with parties or attorneys. However, the parties should be informed and have the opportunity to evaluate the potential bias ahead of time.
In a recent case, a wife challenged an arbitration award based on the arbitrator’s failure to disclose his connection to the husband’s attorney. The parties agreed to arbitration pursuant to their pre-marital agreement. In the initial status conference, the arbitrator said he did not have a material relationship with either party or their attorneys beyond normal professional relationships. He did not supplement his disclosures after a new attorney filed a notice of appearance on behalf of the husband as co-counsel.
When the arbitrator failed to issue an award within the time frame set by the court, the husband’s attorney requested a ruling. In her email, she stated, “You know how much I think of you as a friend and a lawyer . . .” The arbitrator issued the award several days after the email, ruling in favor of the husband and against most of the wife’s claims.