d'Amico Dry d.a.c. v. Tremond Metals Corporation

Background

d'Amico Dry d.a.c. and Tremond Metals Corporation entered into a June 2019 Booking Note under which d'Amico Dry was to carry cargo from Brazil to China. After the shipment was delayed, d'Amico Dry demanded arbitration for demurrage charges, which are liquidated damages owed when cargo is not loaded or unloaded within the agreed time.

Tremond initially did not respond to the arbitration. d'Amico Dry therefore appointed David Lucas as the sole arbitrator under the London Arbitration Act. Tremond later appeared through counsel, actively participated, and asserted a counterclaim. Its counsel did not object to Lucas's appointment.

The arbitrator issued a Final Award on February 24, 2020. The award granted d'Amico Dry $67,260.42 in demurrage, plus 4% interest compounded quarterly; required Tremond to pay or reimburse the arbitrator's $19,528.52 fee, also with 4% interest compounded quarterly; and denied Tremond's counterclaim. The arbitrator later issued a Costs Award granting d'Amico Dry $54,919.80 in costs and $3,179.81 in arbitrator costs, plus 4% interest compounded quarterly. Tremond did not appeal either award, and the time to appeal expired.

Issue and arguments

d'Amico Dry filed a Second Amended Petition asking the court to confirm both awards. The court had jurisdiction under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards and the Federal Arbitration Act. Under the Convention, a court must confirm an award unless the opposing party proves one of the specified grounds for refusing recognition or enforcement.

Tremond argued that the arbitrator's decisions suggested bias, that Tremond lacked the financial ability to pay, and that d'Amico Dry's refusal to settle and decision not to seek insurance coverage should prevent confirmation. Tremond did not identify an enumerated Convention defense, such as an invalid arbitration agreement, inadequate notice, an improper arbitral procedure, or an award that had been set aside or suspended.

Ruling

The court declined d'Amico Dry's request to enter default against Tremond and considered Tremond's arguments. It held that conclusory allegations of bias and dissatisfaction with the result did not establish arbitrator bias or invalidate the awards. Tremond's financial condition was not a basis under the Convention to refuse confirmation, and the settlement and insurance discussions were not relevant to whether the awards should be confirmed.

Because Tremond did not meet its burden to show a valid ground for refusing recognition or enforcement, the court confirmed both awards. Judge John P. Cronan granted the Second Amended Petition, directed the Clerk to enter judgment for $156,069.76 with interest accruing at 4% per year compounded quarterly, and directed the Clerk to close the case.