By Leslie King O’Neal
Interim v. Final Awards—What’s the Difference?
Arbitrators often issue “interim” awards regarding certain issues, such as liability, leaving damages claims or attorneys’ fees for later determination. Are these interim awards subject to motions to confirm or to vacate under FAA §§ 9 and 10? As discussed below, courts have generally held that only “final” awards are subject to confirmation or vacatur, citing FAA §10 (a) and (d).[i] As the Second Circuit explained, “That section has no application to an interim award that the arbitrators did not intend to be their final determination on the issues submitted to them.“[ii]
Bluegreen Vacations Unlimited v. T. Park Central, LLC[iii] Interim Award
This complex real estate dispute involved a contract whose arbitration clause included a cure provision, allowing a breaching party ten days to cure a default. After a twenty-day evidentiary hearing, the arbitrators issued an 81 page “Interim Award,” finding in Claimant’s favor on two breach of contract claims. However, the Tribunal expressly declined to award damages, citing the contract’s cure provision. The Tribunal “direct[ed] the Parties to meet and confer . . . to determine whether and, if so, how Bluegreen will cure its breaches of the [contract], and to report back to the Tribunal concerning those efforts.” [iv]
Court Denies Petition to Vacate Interim Award
Bluegreen filed a petition to vacate the Interim Award under FAA §10.[v] The district court dismissed the petition finding it lacked authority to review the award under the FAA (citing Major League Baseball Players Association v. Arroyo[vi] and Michaels v. Mariforum Shipping, SA[vii]) because it was not a final award. The court noted, “. . . [A]n arbitration award, to be final, must resolve all the issues submitted to arbitration, and . . . it must resolve them definitively enough so that the rights and obligations of the two parties, with respect to the issues submitted, do not stand in need of further adjudication.” Applying these standards, the district court found the Interim Award did not dispose of any claims submitted; therefore, the court lacked authority to review it.
Court Distinguishes Cases Allowing Interim Award Review
The district court distinguished the Zeiler v. Deitsch[viii] case Bluegreen relied upon. Zeiler allowed confirmation of eight interim accounting orders the tribunal issued.[ix] However, in Zeiler, “the decisions at issue “require[d] specific action and [did] not serve as a preparation or a basis for further decisions by the arbitrators.” The district court also distinguished the Bluegreen case from other cases it cited allowing federal review because the Bluegreen Interim Award did not require any specific action, such as ordering payment of funds or placing funds in escrow. Here there was no award of temporary equitable relief such as a security award, separable from the merits of the arbitration, making the award subject to federal review.[x]
Does Review of Interim Awards Help or Hurt Arbitrations?
The finality requirement for judicial review of arbitration awards prevents parties from shuttling back and forth between the arbitrator and court, frustrating the effort to achieve swift and streamlined dispute resolution .[xi] Some judges and commentators state that allowing such review is contrary to the parties’ contract (unless it specifically allows interim award review) and does not necessarily result in swifter and more cost effective dispute resolution. [xii] “Most of the advantages inherent in arbitration are dissipated by interlocutory appeals to a district court. . . .[A] district court should not ‘hold itself open as an appellate tribunal’ during an ongoing arbitration proceeding, since applications for interlocutory relief ‘result only in a waste of time, the interruption of the arbitration proceeding, and . . . delaying tactics in a proceeding that is supposed to produce a speedy decision.’”[xiii]
When is an “Interim Award” Considered “Final” for Review?
As shown by the cases cited here, merely labeling an award “interim” doesn’t mean it cannot be considered “final” for judicial review purposes. Rather, in deciding whether to review a partial award, courts have considered: (1) whether the award is for claims factually and conceptually unrelated to other claims[xiv]; (2) whether the parties agreed to bifurcate arbitration into distinct phases (liability and damages)[xv]; (3) whether the interim award requires a party to perform a specific action, such as posting security or making payment.[xvi]
Takeaways
- If an arbitration involves separate, distinct claims, the parties could agree to allow review of interim awards by amending their arbitration agreement. Conversely, if parties do not want to allow review of interim awards, they could add clarifying language to their agreement.
- Parties receiving interim awards requiring specific action, such as payment or posting security should consult with counsel about whether to move to confirm or vacate the awards within the FAA time limits.
- When agreeing to bifurcate liability and damages claims, parties should consider whether review of interim awards should be allowed and add language to clarify their choice.
- When drafting “interim” awards, arbitrators should consider whether the interim award should be subject to judicial review. If not, include language stating that the award is not final and should not be subject to review.
[i] See generally, Jennifer M. Rhodes, Judicial Review of Partial Arbitration Awards Under Section 10(a(4) of the Federal Arbitration Act, 70 Univ. of Chicago L. Rev 663 (2003). https://chicagounbound.uchicago.edu/uclrev/vol70/iss2/6/
[ii] Michaels v Mariforum Shipping, SA, 624 F.2d 411 (2d Cir. 1980) https://law.resource.org/pub/us/case/reporter/F2/624/624.F2d.411.80-7096.1001.html
[iii] Case No: 24-cv-8009 (JMF) (SDNY 2025) https://law.justia.com/cases/federal/district-courts/new-york/nysdce/1:2024cv08009/630326/24
[iv] Id.
[v] 9 U.S.C. § 10 https://www.law.cornell.edu/uscode/text/9/10s
[vi] No. 24-CV-3029 (LJL), 2024 WL 3539575, at *3 (S.D.N.Y. July 24, 2024) https://law.justia.com/cases/federal/district-courts/new-york/nysdce/1:2024cv03029/619956/36/
[vii] 624 F.2d 411 (2d Cir. 1980)https://law.resource.org/pub/us/case/reporter/F2/624/624.F2d.411.80-7096.1001.html
[viii] 500 F.3d 157 (2d Cir. 2007) https://www.newyorkconvention.org/media/uploads/pdf/4/4/4481_us-613b-23-aug-2007.pdf
[ix] One of the main issues in Zeitler appeal was validity of the orders entered by two arbitrators after the third arbitrator resigned. The 2d Circuit held the orders valid based on the arbitration agreement’s language and applicable law and custom. See Post: Arbitrator Replacement—When, Why and How (10/13/25)
[x] Distinguishing Ecopetrol S.A. v. Offshore Expl. & Prod. LLC, 46 F. Supp. 3d 327, 338 (S.D.N.Y. 2014) ( interim order requiring payment of funds); Sperry Int’l Trade, Inc. v. Gov’t of Israel, 532 F. Supp. 901, 909 (S.D.N.Y.), aff’d, 689 F.2d 301 (2d Cir. 1982) (interim order requiring placing funds in escrow); Brit Ins. Co. of Cayman v. Water St. Ins. Co., 93 F. Supp. 2d 506, 513 (S.D.N.Y. 2000) (interim award requiring posting security).
[xi] Rhodes, supra, note i at 670.
[xii] Rhodes, supra, note i at 682.
[xiii] Michaels v. Mariforum Shipping supra, note 2, at 419.
[xiv] Metallgesellschaft AG v M/V Capitan Constante,790 F.2d 280 (2d Cir 1986) (allowing for an appeal of an arbitral award despite the fact that claims “separate and independent” from the issue at hand remained before the arbitrators).
[xv] Hart Surgical v. UltraCision, 244 F.3d 231 (1st Cir 2001)(when parties formally agree to bifurcate liability and damages phases, a court has power to review the arbitrator’s decision on liability issue before arbitrator determines damages).
[xvi] See cases cited in footnote x.