{"id":899278,"date":"2021-10-27T15:24:40","date_gmt":"2021-10-27T21:24:40","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=899278"},"modified":"2021-10-27T15:24:48","modified_gmt":"2021-10-27T21:24:48","slug":"arbitration-provisions-construction-contract","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/arbitration-provisions-construction-contract\/","title":{"rendered":"Arbitration Provisions in Colorado Construction Contracts: Implications on Challenges to an Arbitrator\u2019s Jurisdiction"},"content":{"rendered":"\n<p>Kelly Smith | <a href=\"https:\/\/information.swlaw.com\/REACTION\/2021\/Newsletters\/UnderConstruction\/1020_UC_WEB.html\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">Snell &amp; Wilmer<\/a><\/p>\n\n\n\n<p>Many construction contracts include provisions requiring the parties to <a href=\"https:\/\/www.myconstructionexpert.com\/blog\/arbitration-provision-incorporated\/\" target=\"_blank\" rel=\"noreferrer noopener\">arbitrate<\/a> disputes relating to the contract or construction project rather than bringing their claims in a court of law. Often times, the arbitration provisions specify which arbitral body will decide the claims and which arbitration rules will govern. The American Arbitration Association (or \u201cthe AAA\u201d) is one such arbitral body that is commonly specified and, in fact, is designated in the AIA standard agreement between contractors and subcontractors and other AIA standard agreements. The designation of the AAA as the arbitral body and its accompanying rules may seem standard and innocuous but can have significant implications in Colorado on: (1) extent of judicial review of the arbitrator\u2019s jurisdiction, and (2) timing of judicial challenges to the arbitrator\u2019s jurisdiction.<\/p>\n\n\n\n<p><strong>Judicial Review of an Arbitrator\u2019s Jurisdiction<\/strong><\/p>\n\n\n\n<p>Generally, Colorado courts determine gateway issues of arbitrability, like an arbitrator\u2019s ability to decide the dispute and jurisdiction over claims. However, where parties incorporate arbitration rules which afford the arbitrator with the power to determine his or her own jurisdiction, Colorado courts find that \u201cthe parties authorized the arbitrator to decide arbitrability issues.\u201d&nbsp;<em>See, e.g., Ahluwalia v. QFA Royalties, LLC<\/em>, 226 P.3d 1093, 1099 (Colo. App. 2009).<\/p>\n\n\n\n<p>Parties can still seek judicial review of an arbitrator\u2019s jurisdiction, but Colorado courts will likely give deference to the arbitrator\u2019s findings on its own jurisdiction if the parties designated arbitration rules authorizing the arbitrator to make determinations regarding jurisdiction. Both the AAA Commercial and Construction Arbitration Rules provide arbitrators with the ability to determine their own jurisdiction. Accordingly, parties should be aware that by designating the AAA\u2019s rules or rules that similarly afford arbitrators the ability to determine their own jurisdiction, they are potentially limiting their ability to seek full judicial review on that topic.<\/p>\n\n\n\n<p><strong>Timing to Seek Judicial Review<\/strong><\/p>\n\n\n\n<p>A party seeking to challenge an arbitrator\u2019s jurisdiction should carefully analyze the proper time in which to bring such a challenge. Colorado\u2019s Uniform Arbitration Act appears to provide parties with the ability to seek vacation of an arbitration award based on the arbitrator\u2019s lack of jurisdiction&nbsp;<em>after<\/em>&nbsp;the award is entered. CRS \u00a7 13-22-223(1)(d). However, waiting to challenge the arbitrator\u2019s jurisdiction is not without risk. The Colorado Court of Appeals has held that \u201ca commercial entity that objects to the arbitrability of a dispute, but does not seek reasonable judicial remedies and instead participates in the arbitration, waives its argument on appeal that the dispute was not arbitrable.\u201d<em>&nbsp;Harper Hofer &amp; Assocs. v. Northwest Direct Marketing, Inc.<\/em>, 412 P.3d 659, 666 (Colo. App. 2014). This holding was a departure from prior Colorado case law, which had permitted a party to challenge an arbitrator\u2019s jurisdiction post-award so long as the party had reserved the right to object to jurisdiction. Id.<\/p>\n\n\n\n<p>Accordingly, parties entering into construction contract in Colorado should pay close attention to the arbitral body and arbitration rules specified in their contract as these rules will affect the timing and extent to which the party may challenge the arbitrator\u2019s jurisdiction.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Kelly Smith | Snell &amp; Wilmer Many construction contracts include provisions requiring the parties to arbitrate disputes relating to the contract or construction project rather than bringing their claims in a court of law. Often times, the arbitration provisions specify which arbitral body will decide the claims and which arbitration rules will govern. The American&hellip; <a class=\"more-link\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/arbitration-provisions-construction-contract\/\">Continue reading <span class=\"screen-reader-text\">Arbitration Provisions in Colorado Construction Contracts: Implications on Challenges to an Arbitrator\u2019s Jurisdiction<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[41,9],"tags":[9895,9310,120,224],"class_list":["post-899278","post","type-post","status-publish","format-standard","hentry","category-arbitration","category-construction-contracts","tag-advise-consult","tag-arbitration-provision","tag-colorado","tag-construction-contract","entry"],"jetpack_publicize_connections":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Arbitration Provisions in Colorado Construction Contracts: Implications on Challenges to an Arbitrator\u2019s Jurisdiction - Advise &amp; 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