Courtesy of the Ninth Circuit, we kick off 2019 with some fundamentals. The Federal Arbitration Act gives parties three months to petition to vacate an arbitration award. We know that “Three is the Magic Number,” but how exactly is a disappointed party supposed to calculate the three months?
Section 12 of the FAA requires that a petition to vacate be served upon the adverse party “within three months after the award is filed or delivered.” In Stevens v. Jiffy Lube Int’l, 2018 WL 6802644 (9th Cir. Dec. 27, 2018), the Ninth Circuit concluded that the three months should be calculated according to Federal Rule of Civil Procedure 6(a). That requires three steps. First, exclude the day the award was delivered. Second, calculate three months like this: “The first month began September 15 and concluded October 14; the second month began October 15 and concluded November 14; and the third month began November 15 and concluded December 14.” In other words, it does not matter whether it is a 28-day month or a 31-day month. It matters what day of the month the award was delivered. For the third and final step, if the end of that three month period is a weekend or holiday, the period gets extended to the next business day.
In Stevens, the party seeking vacatur made the mistake of believing that “three months from September 15, 2016, was December 15, 2016.” But, the court used multiple examples to point out why that is illogical. And therefore, it concluded the petition to vacate was filed one day late and was properly rejected as untimely.
Ouch.