The continuing uncertainty as to the legal propriety and |
enforceability of contractual opt-in provisions for judicial |
review is best demonstrated by the opinion of the Ninth |
Circuit Court of Appeals in LaPine Technology Corp. v. |
Kyocera, 130 F.3d 884 (9th Cir. 1997). The majority opinion in |
Kyocera framed the issue before the court to be: "Is federal |
court review of an arbitration agreement necessarily limited |
to the grounds set forth in the FAA or can the court apply |
greater scrutiny, if the parties have so agreed?" The court |
held that it was obliged to honor the parties' agreement that |
the arbitrator's award would be subject to judicial review for |
errors of fact or law. It based that holding on the |
contractual view of arbitration articulated in Volt and Prima |
Paint Corp. v. Flood & Conklin Manufacturing Co., 388 U.S. |
395, 404 n.12 (1967) and their progeny. In doing so it |
observed that body of case law "makes it clear that the |
primary purpose of the FAA is to ensure enforcement of private |
agreements to arbitrate, in accordance with the agreement's |
terms." The Ninth Circuit relied squarely on the opinion of |
the Fifth Circuit in Gateway. The court rejected the |
"jurisdictional" view of the FAA set out by the Seventh |
Circuit in Chicago Typographical Union. |