Third Circuit finds lack of a contractually designated arbitration forum does not nullify an arbitration agreement.
The Third Circuit found the arbitration agreement to be ambiguous as to whether the designated National Arbitration Forum (NAF) was intended to be the exclusive forum for resolving disputes and was, thus, an integral part of that agreement. The majority resolved this ambiguity in favor of arbitration. It held that the designation of the NAF was not exclusive and, therefore, not integral to the agreement and that the unavailability of the NAF did not render the arbitration agreement unenforceable. The court further held that such unavailability constituted a “lapse” within the meaning of Section 5 of the Federal Arbitration act, thereby requiring the appointment of a substitute arbitrator.
Case Law Alert - 3rd Qtr 2012