I. Introduction
 
Parties make arbitration agreements under their free will, and in different countries, cultural backgrounds, and legal systems. The procedure for making these agreements is very private and informal,[1] but worthy of our attention because international commercial arbitrations is perhaps a daily occurrence.[2] Parties make agreements to submit any possible disputes to arbitration. This form of arbitration is the foundation stone of international commercial arbitration.[3] Arbitration is perceived as quite capable of resolving disputes between parties on contracts mechanism. When parties agree upon the arbitration process for dispute-solving, the arbitral award should be final and binding. Conversely, when parties submit issues to arbitration and agree that courts pose the power for judicial review on the award, this would also be a result worth discussing.[4]
As mentioned in Chapters 1 and 4, international arbitration puts a lot of emphasis on the freedom of contract, and thus party autonomy plays an important role. However, the will of parties is still restricted by issues such as the public interests or mandatory rules of the law of the place in which arbitration was done or award made.[5] Traditionally, judicial review on arbitral award is rather restricted, because once it is unlimited, it would destroy two crucial goals of arbitration to wit: resolving disputes effectively and avoiding long process and huge expenses for litigation.[6] Compared with the past, it presently allows for broader jurisdiction for review.
General speaking, vacatur is granted only when it has been shown that the arbitral process had lacked fairness for reasons, which have to do with arbitrator bias or misconduct, fraud in consideration of or handling or dealing with evidences worth mentioning, as well as corruption over most modern arbitration laws delivering grounds for vacating awards should be narrow, not arbitrators misinterpret it like a mistake of fact or law.[7]
For the reason that the various circuit courts in the U.S. are yet to reach an agreement on this issue with pros and cons backed by each court, the U.S. Supreme Court, too has not been able to unify the discordant views among them. The U.S. appellate court has made a different decision on whether the U.S. courts follow the expanded review on arbitral awards by parties’ agreement.[8] The arguments on this issue, in fact, show the different stands of the courts and scholars on freedom of contract-making principle and expanded judicial review. This chapter shall focus on  finding out the circumstances where arbitral award can be said to be final and binding, and to  discover the relationship between party agreements and judicial review of the arbitral award。
 
II. Parties’ Agreement and the Expanded Judicial Review
                                                                                                                                                   
The party agreement is an agreement for both parties to submit current or future disputes to arbitration.[9] Two categories of arbitration agreement are envisaged herein; firstly, the most common one is a submitted agreement about future disputes to arbitration which is generally inserted as the form of an arbitration clause in the principal agreement between parties. Secondly, it concerns an already existing arbitration dispute, referred as “submission to arbitration agreement” or “submission agreement”.[10] The international arbitration conventions, for example, Geneva Protocol of 1923,[11] the New York Convention of 1958,[12] and European International Commercial Convention of 1961,[13] all recognize the effectiveness of arbitral agreements, in which parties make agreement to take future disputes to arbitration. In some countries, parties are clearly authorized by the arbitration law to expand the judicial review standards of arbitral award.[14]
 
III. Practice in the U.S. Jurisdictions
 
The U.S. courts have for long refused to enforce arbitral awards mainly to ensure the jurisdiction of courts.[15] On the one hand, in order to curb the hostility of U.S. courts toward arbitral procedure as well as arbitral award, the U.S. Congress passed the U.S Federal Arbitration Act (FAA) in 1925. On the other hand, putting FAA into practice was to ensure that private arbitral agreement were enforceable under parties’ own will.[16] In the U.S., due to the contrasting opinions about the expansion of judicial review resulting from the different and varied interpretations of the FAA; two sides have emerged with different ideas about the purport of FAA’s clause of an expansion of review, and this creates different views about the expansion. The FAA was adopted in 1925, designed to prevent the hostility of U.S. courts in the arbitration process, because courts refused to enforce arbitral awards, “jealously guard[ing] their own jurisdiction to decide cases.”[17] Varied interpretations of the FAA is the main cause of the controversies surrounding the issue of expansion of judicial review among circuit courts, and each policy was made to support its view on this matter. The FAA does not clearly state parties can create the scope of judicial review themselves.
Section 9 in the FAA states:
 
“If the parties in their agreement have agreed that a judgment of the court shall be entered upon the award made pursuant to the arbitration, and shall specify the court, then at any time within one year after the award is made, any party to the arbitration may apply to the court so specified for an order confirming the award, and thereupon the court must grant such an order unless the award is vacated, modified, or corrected as prescribed in sections 10 and 11 of this title. If no court is specified in the agreement of the parties, then such application may be made to the United States court in and for the district within which such award was made…”[18]  
 
From the above provision it is clear that Section 10 allows a vacatur of award only under the grounds listed by the courts.[19] It states the grounds concerning applicable law for vacating an award.[20] Nevertheless, the U.S. Circuit courts have disparate opinions about whether Section 10 provides for the grounds for vacating foreign arbitral awards issued in the United States.[21] Some courts, at least the Eleventh Circuit Court, confirm to confirm the validity of foreign awards issued in the United States, holding that they were not governed by the New York Convention.[22] Obviously, the Eleventh Circuit Court held that foreign awards decided in the United States were not an issue, and only domestic ones may be accepted. However the Second Circuit Court particularly insisted that the interpretation that foreign awards issued in the United States were governed by the same grounds as domestic ones should be consistent with the New York Convention at least.[23] For instance, the grounds for vacating an award are ‘manifest disregard of law’, and this is neither stated in the New York Convention nor attached to it by case law. In this situation, the Court declared that “the interpretations of the law by the arbitration in contrast to manifest disregard are not subject, in the federal courts, to judicial review for error.”
Section 11 provides that the U.S. courts of arbitral location can order to modify or correct an award if parties ask for courts’ involvement for the three following reasons: a matter not affected by the merits of the controversy, a matter not submitted to arbitrators, and an evident material miscalculation of figures or an evident mistake.[24]
The expanded review creates a mixed procedure for resolving disputes between parties, that is, judicial review of awards on the merits.[25] In the past, this measure did not happen in any case of the arbitration, and the FAA drafters most likely had not foreseen this would take place, because they meant to limit the judicial review, as narrowly as possible, for fear that the courts with enmity against arbitration would overturn awards.[26] It is ironic for today’s courts, because nowadays they do not hold on to the power of review in order to try to overturn arbitrators’ decisions. Instead, the opinion among some courts is against the expanded review, which reduces the right to involve in the arbitral process as well as chances of overturning the awards. If courts reject expanded review, then this would mean a throwback to the point where the FAA excluded the court from getting involved in the arbitral process in 1925. As a result, courts invoking this clause in the FAA narrowly interpret their rights to meddle in the arbitral process, even under parties’ request.[27] If parties agreed to contract for expanded review, it would inhibit the enthusiasm and willingness of the arbitrators to make award for fear of their decisions being set aside. Furthermore, arbitral award would be expected to include reasoned opinions leading up to the decision, based on the law and findings of fact. Thus, it would further diminish the simplicity, expediency and cost-effectiveness of arbitration, and make arbitration another step in the litigation process.[28]
According to Section 10, under certain circumstances the United States court in and for the district wherein the award was made may make an order to vacate the award on the request of any party to the arbitration[29] Section 11 also provides that in specific cases the United States court in and for the district in which the award was made may make an order modifying or correcting the award upon the application of any party to the arbitration.[30] According to the FAA, reviews of courts are limited to procedural issues, excluding substantive ones. We find out that, first, some parties still alter the scope of judicial review in practice. Second, circuit courts have varied opinions on the interpretation and application of FAA. These two reasons make the expansion of judicial review a contentious issue among the U.S. courts, and more problematic is the fact that the U.S. Supreme Court has not yet made a final decision to put this controversy, finally to rest and clarify this area of procedure.[31] Under such circumstance, there is great uncertainty as to whether parties in the U.S. can change the arbitration contractually, especially expand the scope of judicial review on arbitral awards.
In New England Utilities, Inc. v. Hydro-Quebec,[32] a Canadian company, H-Q had a dispute with NEU, an American company, in the matter of cost of transportation and of purchase. The dispute was submitted to arbitration in Boston, and the award turned out in favor of NEU, which sought to enforce the award whereas the other party moved to vacate it under the arbitration clauses. The arbitration clauses provided that the award the arbitrator made was final and binding, and the parties were unable to appeal unless there were errors of law in the award that needed reviewing. The U.S. District Court for the District of Massachusetts held that it was appropriate for the court to review errors of law in the award according to the parties’ agreement. After considering other courts’ decisions in related cases, the court decided to follow the Fifth Circuit’ decision in Gateway,[33] which was in favour of allowing for expanded judicial review under parties’ agreement.[34]
However, the First Circuit held that the court was incapable of reviewing errors of law in an award. Only when the arbitrator manifestly disregards the law can the court review the award, such as in Wilko v. Swan,[35] the reasons for review, however, were limited; a mistake the arbitrator made was not one of the reasons that would allow for judicial review of the award. For instance, in cases of Prudential-Bache Sec., Inc. v. Tanner[36] and of Wonderland Greyhound Park, Inc. v. Automated Systems, Inc,[37] parties did not agree in the contract to review errors of law. These non-statutory cases for setting aside interpretations of arbitration award have been limited. For example, more cases of error or misunderstanding of the law is needed for courts to pronounce more decisively on the issue of “manifest disregard of the law." Furthermore, the evidence must show clearly that the arbitrator knew the law and explicitly disregarded it.[38]
 
IV. Party Agreement to Narrow Judicial Review
 
The supporting legislation usually only allows the substantive questions admitted in law to be appealed about. See for example, the English Arbitration Act of 1996.[39] The parties, however, can abandon this appellate right under the arbitration agreement. In general, the law denying this right usually orders that parties can not make agreements with reasons to exclude the judicial review of the court. For example Voluntary Arbitration of Portugal states “1.The right to apply for setting aside of the arbitral award may not be excluded. 2 An application for setting aside may only be made within a period of one month from the date of the notification of the arbitral award.”[40] But parties can abandon this right to/of appeal. Legislative provisions against this right usually stipulate that parties cannot exclude the reasons for court’s review on procedure. However, Switzerland's Private International Law Statute has a somewhat different provision to wit: “1.Where none of the parties has its domicile, its habitual residence, or a business establishment in Switzerland, they may, by an express statement in the arbitration agreement or by a subsequent agreement in writing, exclude all setting aside proceedings, or they may limit such proceedings to one or several of the grounds listed in Article 190, paragraph 2. 2. Where the parties have excluded all setting aside proceedings and where the awards are to be enforced in Switzerland, the New York Convention of 10 June, 1958 on the Recognition and Enforcement of Foreign Arbitral Awards shall apply by analogy.”^[41] One of the reasons behind the support of expanded judicial review on the merits is that the parties against the right to unreviewable award will not submit the disputes to arbitration, but empower the courts to resolve them.[42] Now in the U.S., one of the reasons for opposing expanded review is that the courts would usually vacate the entire award while they refuse to review it as the parties may have requested. And because the parties would not have agreed on arbitration if they had known the expanded review would not be entertained or granted by the courts. Consequently, the entire arbitral agreements will be untenable if courts refused to expand judicial review.[43]
 
V. Courts Agree Parties’ Contractually Expanded Judicial Review:
 
Gateway Technologies, Inc. v. MCI Telecommunications Corp[44] is the leading case regarding expanded judicial review of arbitration awards. The parties here inserted a clause to the effect that the arbitral award would be final and binding, and further provided that errors of law shall be subject to appeal. After Gateway set up the system, MCI complained that it improperly completed many collect calls. To resolve this problem, MCI planned to integrate its own system to replace Gateway's. The arbitrator held in favor of Gateway. On appeal, the issue was whether the court should review the decision for errors of law either according to the stipulation of the contract or whether in accordance with the policy of the FAA which was in favour of limiting judicial review of arbitral award. The Fifth Circuit held inter alia that contractual modification of the standard of review was permissible, because the Supreme Court had hitherto held that arbitration is a creature of contract. Furthermore to hold otherwise, would be contrary to the FAA's purpose of ensuring that parties freely enter into agreement which would be ordinarily enforceable. In the Court’s view, the FAA had only provided a default standard of review; and parties were free to expand judicial review by agreement. The Court followed the view of Volt Information Sciences, Inc. v. Board of Trustees of Leland Stanford Junior University, in which the Supreme Court stated that federal policy would not favor arbitration according to a certain set of procedural rules; the federal policy is capable of being enforced, and private agreements are to be arbitrated under the terms parties themselves have made.
The Ninth Circuit Court made a similar conclusion in LaPine Technology Corp. v. Kyocera Corp.[45] the fact of which is as follows: The parties entered into a contract which included an arbitration clauses that provided as follows: (1) the arbitrator shall issue a written award, in which should be stated the grounds for the award, detailed facts, and conclusions of law (2) the court shall vacate, modify, or correct the award under the following circumstances: according to the agreed reasons, the fact was not supported by specific evidence; the conclusion of law arrived at by the arbitrator was wrong. In this case, the arbitral award was in favor of LaPine, and, Kyocera, dissatisfied with the result, rejected the award, and asked the court to vacate it according to its agreement with LaPine. LaPine Technology Corp moved to confirm the award from the court relying on the FAA. Kyocera applied to have the award set aside, and asked the court to apply the standard and scope of review provide for in the parties’ agreement. The Court held that it could not apply the broader review scope made by the parties because the written law restricted the court from exercising such jurisdiction, in the following words: “the Federal Court has to consider public interests, but not to serve private interests as its main purpose. The responsibility of the court cannot be violated due to parties’ contracts.” The court also held that, it would have violated public policy if it had moved according to the parties’ agreement to allow for thorough judicial review, because this judicial review would amount to a process of re-establishment of facts, and this certainly would violate its pro-arbitration policy. The Court confirmed the arbitral award and rejected Kyocera’s plea. Kyocera then filed another lawsuit. The District Court refused Kyocera’s petition for vacating the award, holding that parties cannot by contract expand the judicial review jurisdiction of the FAA. Kyocera then appealed to the Ninth Circuit for an order setting aside the decision of the District Court. The Appeal Court upheld the opinions of the court expressed in Gateway and supported the FAA policy. It also concluded that the main objective of the FAA is to ensure that the arbitration goes under the words of private arbitration. The main purpose of the FAA was to make sure the private arbitral awards could be enforced according to their agreements. The court also noted that the parties were free to submit disputes to arbitration and choose arbitrator to conduct the arbitration proceedings.
We can safely assume here that the U.S. courts will only grant expanded review of awards on merits of law and confirm the award. The party in favour of whom the award is made may seek to enforce the award in the place where the other party has its assets. The other party, however, can appeal based on a clause in the arbitration agreement, “except that errors of law shall be subject to appeal,” which means the award must be final as well as binding. Consequently, the party against whom the enforcement of the award is sought may appeal to the enforcing court for a review on the merits.[46]
This clause enables parties to appeal to the enforcing court to review on the merits.[47] This is because in most of the member states of the New York Convention,[48] their courts may not be favorably disposed to reviewing arbitral awards on the merits, the parties can put their assets in the place where the New York Convention does not operate, or in a place where the parties’ agreement is completely honored. As a result, if the parties want to expand judicial review, they have to make sure from the time of drafting the agreement that the judicial review can be enforced completely in the enforcing court and country. The clause inserted in the agreement in the case of LaPine is a case in point:
 
“The arbitrators shall issue a written award which shall state the basis of the award and include detailed findings of fact and conclusions of law. The United States District Court for the Northern District of California may enter judgment upon any award, either by confirming the award or by vacating, modifying or correcting the award. The Court shall vacate, modify or correct any award:
(i) based upon any of the grounds referred to in the Federal Arbitration Act,
(ii) where the arbitrators’ findings of fact are not supported by substantial evidence, or
(iii) where the arbitrators’ conclusions of law are erroneous.”[49]
 
The parties should especially note which court reserves jurisdiction to use expanded review in order not to confuse the enforcing court, which might think the parties give it the power at the enforcement stage by agreement.[50] To avoid this mistake and ambiguity, the parties should pay attention to these points when drafting the agreement. It is fairly important to make this point clear, since it is impossible for the foreign enforcing courts to have expanded judicial review, and then they can refuse to enforce the award on the account of invalid award. Just as in the first example, the court found that if the parties had known the local court or the enforcing court would not have expanded review on errors of law in an award, they would not have agreed to arbitrate. Consequently, their agreement on arbitration was invalid.[51] In this case, we see plainly that the U.S. Appeal Court’s policy is pro-arbitration, and in favor of approving judicial review on arbitral award made pursuant to parties’ agreement. The Appeals Court, in furtherance of federal policy, reviewed the Supreme Court’s decision to make sure that the agreed-arbitration was enforced.
However, Professor Smit has opposed the Ninth Circuit decision in LaPine and states that exclusion of judicial review of arbitral awards for errors of fact or law is a very significantly different from litigation, which is also widely acceptable. If it was possible to review arbitral awards could for errors of law or fact, arbitrations would become a precedent step towards litigation, and another vehicle in ordinary courts, making them undertake this socially most reprehensible outcome. The exclusion also represents an important reason to encourage federal and state legislature to declare enforceable arbitration agreements unenforceable. If such enforcement is realised, it will provide a most efficient method of dispute settlement and greatly reduce the burdens usually placed on the ordinary courts. The opposing view should not be accepted for both practical and legal reasons, as well as for reasons bordering on informed social policy.
Professors Rau and Smit respectively, agree in opposition to the views expressed by the Ninth Circuit, stating that if arbitral awards can be subject to judicial review for errors of law or fact, arbitration would then become an extended step in helping to unravel complicated instances of litigation in the ordinary courts. If the scope of judicial review is allowed to be limited by contract between parties, it would be contrary to the public policy of encouraging arbitration. He also points out that the statute’s default allocation of authority between courts and arbitrators in no way implies, a restriction on the power of the parties themselves to use the arbitration mechanism to further promote their interests
Similarly in Gateway Technologies, Inc. v. MCI Telecommunications Corp,[52] the parties agreed on expanded judicial review in the contract, which not only supplemented the default standard of the FAA. The court allowed for expanded judicial review.
Likewise, in Volt Information Sciences Inc. v. Board of Trustees of Leland Stanford,[53] the court was of the opinion that courts should support parties’ agreement related to judicial review, as the Supreme Court was in favor of the parties’ right to contractually decide on the applicable law to govern their transaction. But the Seventh and the Eighth Circuit Court asserted the purpose of the Supreme Court in Volt Information Sciences Inc. v. Board of Trustees of Leland Stanford, to the effect that the Supreme Court was neither calling for strict observance of the judicial review from the parties, nor adherence to the arbitration process strictly. The facts of this case were that the Board of Trustees of Leland Stanford in Stanford University filed a lawsuit against a contractor, Volt Information Sciences, for fraud and breach of contract. Volt Information Sciences filed a petition to enforce arbitration and stop prosecution from the university. Charles Gordon, J., from the Superior Court in Santa Clara County the position of the university to stop arbitration, and Volt Information appealed. Chief Justice Rehnquist of the Supreme Court stated that the Federal Arbitration Act and California Law were of co-ordinate jurisdiction concerning arbitration. In the arbitration agreement, the parties agreed to follow the state rules of arbitration, and California law permitted the court to stop arbitration when third parties were involved excluding situations where they are restricted by it. Federal Arbitration Act was meant to pass and enforce arbitration agreement which was refused or at least substantially impeded by the judiciary for a long time. The Federal Arbitration Act carries on arbitration procedure according to the contract of the party concerned. When interpreting the provisions of state law and Federal Arbitration Act on this issue, we must pay attention to the federal policy which may side with the principle of freedom of arbitration, and its influence resulting pro-arbitration stance. The Supreme Court had the right to review the ruling made by California Court of Appeal; it supported California Law, which permitted stopping the arbitration in related suit when third parties were involved but not restricted by it. Federal Arbitration Act did not exempt California Law from stopping arbitration in related suit when third parties were engaged but not restricted by it, though there was cross-state commerce in the disputes between university and contractor, the parties had reached an agreement to follow California law of arbitration as they entered into the contract.
Those who are against expanded judicial review claim that situations where parties can still resort to judges after the arbitration process will only serve to make the arbitration less efficient, more expensive, and completely devoid of confidentiality. But the scholars who are in favour of  parties’ right to enter into agreement on expansion of judicial review believe that the parties’ agreement to expand judicial review of the arbitral award will impose greater responsibility on arbitrators and parties, and this will push their willingness to participate in arbitration, and avoid being restricted by the FAA. This group is motivated by a certain ideology: what we need is not a unified and fixed arbitration system or another mechanism for resolving disputes. What we need is a mechanism with adaptability with parties having different interests.[54]
 
VI. Courts Negate Parties’ Agreement to Expand Judicial Review
 
Some of the U.S. courts, nonetheless, still refuse to grant expanded judicial review and choose instead to vacate an award on account of invalid arbitration agreement.[55] The reason advanced by the court for this decision was because it found that if it were not for the fact that the parties   knew there was a possibility for an expansion of review, they would not have agreed on arbitration. As a consequence, we know by given fact that their agreement on arbitration was held to be invalid, since they did not actually agree to expanded review.[56]
In this case, we can safely infer that if the party in favour of whom the award was made wants to enforce it in another judicial system, the foreign judicial system quite likely to refuse enforcing the award on the grounds of the invalid agreement. For example, let us assume the parties are subject to the New York Convention. According to the New York Convention, under Article V (1) (a), the enforcement of the arbitral award will be refused by the court if their agreement is invalid.[57]
The decision in cases such as Gateway really did not represent the U.S. courts in unanimity, because some courts still had disparate opinions on those issues. In Bowen v. Amoco Pipeline Co,[58] the parties’ agreement was for the district court’s decision on the arbitral award “shall be final,” and this did not hinder the appellate court’s review of the district court’s decision. Bowen had filed a lawsuit against Amoco in the District Court. Amoco, on the other hand, asked the Court to cease proceedings based on the arbitration clause in the contract. The U.S. District Court for the Eastern District of Oklahoma granted Amocodi’s petition. The award turned out to be in favor of Bowen, which sought to confirm it. However, Amoco moved to the court to set it aside. The District Court did not accept the party-agreed expanded judicial review, and thus it refused to set aside the award and in the same breath confirmed it. Amoco, still dissatisfied with the decision, appealed to the U.S. Tenth Circuit. The Chief Judge of the Court of Appeals, Tacha, stated that: (1) the arbitration agreement did not hinder appellate review (2) It will be forbidden for parties to take the contract as a means to expand the judicial review standard of award (3) The arbitral tribunal could not exceed its powers or manifestly disregard the law on this matter. Though according to the arbitration agreement, the parties may discard judicial review in the contract; however, they still had to explain clearly and specifically their main purpose for this. While reviewing the district court’s decision of vacating the arbitral award, the Court of Appeal not only reviewed questions of law anew, but were also able to find certain obvious mistakes in evidence. The reason for vacating the arbitral award was that the arbitrator manifestly disregarded the law, and it was proved that the arbitrator understood the law and manifestly disregarded it. Even if the parties had made an arbitration agreement, providing that the arbitral award could be appealed against if the tribunal finding was not backed by evidence, but the judicial standard of review will nevertheless be restricted. The Tenth Circuit held that the parties could not expand judicial review powers of the court. The court hopes the arbitral award could be enforced under the laws or the law precedents. Granting the parties the right to expand the scope of judicial review would increase the possibility of dissenting views on the award, the time spent and the cost, thereby running contrary the FAA policy; to ensure arbitration is faster, cheaper and more private than litigation. In order to ensure that these advantages are not lost, the law severely limits the availability of judicial review of arbitration proceedings, making the arbitration process expeditious as well as a lot more economical than litigation. In the Tenth Circuit’s opinion, expanded judicial review would violate the policy of the FAA, of ensuring that the provisions of the FAA which permit the enforcement of the parties’ agreement did not  tantamount to expanding judicial review, because in this way, the court may make unsuitable decisions. The FAA only allows for limited expanded judicial review, which makes it take serious cognizance of the arbitral process in the exercise of its jurisdiction and thus prevent or at worst minimize the possibility that award would be set aside at the end of its exertions. Limited expanded review standard enables the pro-arbitration policy to continue in the spirit of keeping the arbitral process independent. FAA, under Article 4 allows the parties to ask the court to enforce arbitral award under the parties’ agreement. However, other Articles,[59] governing judicial review, do not state clearly that the court had the jurisdiction to review award under the parties’ agreement. Expanded judicial review of law and fact of the award would violate the supposedly final and independent nature of an award because the court’s responsibility is to enforce the award and make it effective as well, as provided under the parties’ agreement. The Tenth Circuit agreed with this point and held that the parties could not contractually expand judicial review. Consequently, if the court decided to expand judicial review, it could only do so in accordance with the provisions of and with reference to the FAA or the “manifest disregard of law” standard. The Court also held that the Tribunal did not exceed its power or manifestly disregard the law when it ordered Bowen to clean up his property. Therefore, the Court confirmed/ upheld the decision of the District Court.
Stakeholders who object to expanding judicial review, have proffered convincing reasons in support of their position. First, granting parties the right to expand judicial review based on such questions as whether the arbitrator examined the issues and applied the laws properly, would violate one of the advantages of the arbitration—lessen the court’s burden. Second, and more seriously, it would increase the time involved in treating disputes if arbitral awards were limitlessly subject to judicial review.[60] The mechanism of FAA is an efficient method for arbitration, because the procedure under the FAA takes very little time in judicial review. Moreover, expanded judicial review would inevitably lead to one judicial institution examining another, and parties would forever be saddled with doubt as to the efficiency of the system generally, especially when the arbitrator did not apply the law of the place in which the arbitral award was made, and it may bring about an embarrassing result. Finally, if the expanded judicial review has ended in the setting aside of an award due to reasons of errors of law or fact or even both, it would increase problems; such as the case where an award vacated due to errors of law or fact is likely to be enforced in France or other countries under the New York Convention. This will precipitate a system fraught with conflict of the judgments.[61]
In Eljer Mfg., Inc. v. Kowin Development Corp.,[62] the U.S. District Court for the Northern District of Illinois, Eastern Division, set aside part of the arbitral award. The Seventh Circuit agreed with the District Court. The Seventh Circuit insisted that such a mechanism to limit judicial review or intervention was required, and that arbitration should not to be a “preliminary step to judicial resolution.”
In UHC Mgmt, Co. v. Computer Science Corp.,[63] the contract, between the contractor and subcontractor, stated that the beneficiaries could claim for medical damages. However, the contract was terminated by contractor UHC, because it was dissatisfied with subcontractor Computer Science’s performance. The arbitrator made an award which was in favor of UHC amounting to $1.3 million. UHC applied to confirm the award, while the Computer Science applied to the U.S. District Court for the District of Minnesota to vacate, modify or correct it. However, The District Court confirmed the award, holding that the governing law was the FAA, so it could be altered according to the FAA. After referring to the cases of the U.S. Supreme Court, the Eighth Circuit permitted the court to modify or correct the award;[64] but it could review the award under the Section 11 of FAA.
 
VII. Parties’ Agreement to Limit Judicial Review
 
This distinctive feature of English arbitration law is well known to English arbitration and legal practitioners, including those involved in drafting arbitration clauses in international contracts. They may thus, in certain circumstances, purposely decide to insert language to the effect that any form of appeal is excluded, in order to avoid an appeal on a question of law, considering that such language will not exclude their right to challenge the award under the Act for want of jurisdiction or serious irregularity. Difficulties may arise when such clauses are then transplanted into contracts providing for arbitration outside England, thus subject to the arbitration law of another jurisdiction, under which exclusion agreements/clauses may have a different effect. Such might be the case in Switzerland.
Contrary to the above cases, there appears not to be any real discrepancy in the attitudes of the courts in this issue, it is because they do not support parties’ right to exclude or limit judicial review. Take Hoeft v. MVL Group Inc.[65] for example, the parties made an agreement that the parties should do their best in partnership to resolve any dispute that might occur during the business transaction. In the event that the parties are unable to resolve the dispute, they should turn to Steven Sherrill, whose decision must be binding and final leaving the parties with no right of recourse to review or appeal of any kind with this arbitral award. The Stock Purchase Agreement also contains a general arbitration clause, which agrees on the parties conducting the arbitral proceedings all under the Rules of American Arbitration Association (“AAA”). The Arbitrator then made an award in favor of Richard Hoeft and Carol Hoeft. However, the respondents MVL and Discovery Research Group of Utah were dissatisfied and sought to vacate it. After the review, the District Court found the arbitrator Sherrill manifestly disregarded the law and granted MVL’s petition to vacate the award, while it refused the Hoefts’s petition. The Hoefts disagreed with the decision of the District Court and appealed his case to higher court raising three grounds of appeal. First, the Amendment stated the award would be separated from judicial review; consequently, while considering whether or not the arbitrator had manifestly disregarded the law at all, the District Court had made a mistake. Second, the arbitrator’s decision-making process was not a suitable ground for the Court to depose of his award. Third, they reasoned that the arbitrator did not manifestly disregard the law or exceed his powers in any way. On the other hand, MVL applied to set aside the arbitral award on four grounds: (1) that Sherrill exceeded his powers, (2) that the arbitrator manifestly disregarded the law because he didn’t apply GAAP in this case, (3) that the parties did not explore all the avenues open to them to amicably resolve a dispute as stated in the Amendment, and (4) that the arbitrator prejudged the matter and had taken sides with the Hoefts. The 2^nd Circuit Court insisted that parties asking for confirmation of the arbitration awards in federal court may not interfere with the right and ability of the court to exercise judicial review. The 2^nd Circuit Court also held that it was wrong for the district court to supported MVL in raising doubts about the arbitrator’s decision-making process, because such attitudes on the part of the court will cause serious criticisms from U.S. courts. Besides, it made the arbitration process more complicated, and reduces the arbitration process into a sort of mechanism for beginning the resolution of dispute, rather than the end resort. The 2^nd Circuit Court also held the Hoefts could not do so in the following terms: Parties seeking to enforce arbitration awards through federal court confirmation judgments may not divest the courts of their statutory and common law authority to review both the substance of the awards and the arbitral process for compliance with the FFA §10(a) and the manifest disregard standard. In other words, we must examine the merits of the District Court’s conclusion that the arbitrator manifestly disregarded the law in rendering his award.[66]
From the case of Hoeft, we can conclude that the party requesting vacatur of an arbitral award is not supposed to depose the original arbitrator though they do not know for sure whether they will be allowed to find out the fact or to examine the decision-making process. Parties, nevertheless, are not restricted by material in the award. Awards vacated on the grounds of manifest disregard of law are few; they are usually found to occur in employment arbitration rather than commercial ones.
In Hoeft's case, the MVL had tried use the principle of “manifest disregard of law” as ground   in support of its application for a review on the arbitral award. However, the application was refused by the court. The 2^nd Circuit Court of Appeals, however, set out the regulations for “manifest disregard.” The two-prong test for ascertaining whether an arbitrator has manifestly disregarded the law has both an objective and a subjective component. Firstly we should consider whether the “governing law alleged to have been ignored by the arbitrators [was] well defined, explicit, and clearly applicable.” We then look to how knowledgeable the arbitrator actually is. The arbitrator must “recognise the existence of a clearly governing legal principle but decide to ignore or pay no attention to it.” Both of these prongs must be satisfied before a court may find that there has been a manifest disregard of law.[67]
These two points of standard for reviewing and vacating awards are anything but usual because the arbitral tribunal may commit errors while they may have different interpretations of law. The only reason for vacating awards is obvious mistakes in them; however, it gives the party against whom an award has been made some hope of review and possible vacation of the award by the court. Thus, the court is able to review the substantive issues of an award under the rule of “manifest disregard of law” if there is some doubt as to the validity of it.[68]
Similarly, the Second Circuit in International Telepassport,[69] had to consider the arbitral clauses which stated that “the arbitral award shall be final and can not be appealed.” The court held it did not exclude the operation of Section 10 of the FAA. Therefore, it was acceptable to review the arbitral award according to the FAA. Furthermore, the precedents in other courts show that parties cannot exclude the application of an international convention by agreement. Recognition and enforcement of the award may be refused, at the request of the party against whom the award was made under New York Convention, no matter how the contract was made. For instance, in Iran Aircraft Industries v. Avco Corp,[70] the party in favour of whom the award was made argued that the other party should not apply the New York Convention for review of the award, because they had agreed that the arbitration would be “final and binding.” Avco filed to Iran-U.S. Claims Tribunal against the U.S. breached its obligations according to the Algiers Declarations concerning the enforcement of the Tribunal Award. Iran claimed that the awards which were made by international arbitral tribunal should be recognized and enforced in domestic courts according to international law. In other words, the awards could not be reviewed or refused enforcement by domestic courts, and this award did not apply to the Article V of the New York Convention. U.S. replied to the Iran-U.S. Claims Tribunal claiming that the U.S. had followed all the requirements under rules. However, the Tribunal held the Second Circuit made an erroneous decision, because the U.S. Second Circuit violated the Algiers Declarations which ensured that the tribunal’s decision was final, binding and effective, and it was enforceable in the U.S. courts.
The Second Circuit pointed out that “final” and “binding” simply meant that no court could review the questions that have been resolved by arbitration. In our opinion, even if the award was “final” and “binding,” it ought to be governed by the New York Convention. As a result, parties could still refute the enforcement, according to the New York Convention, even their agreement stipulated that the award would be “final” and “binding.” From the above statement, we can see exactly what the U.S. court’s stance is: first, parties have no right in reducing the judicial review to a scope smaller than the scope provided for in laws and regulations. No matter how the parties make the agreement, the losing party can still ask for a vacatur of the award pursuant to Section 10 of the FAA and object to the enforcement according to any Articles of the New York Convention.     
Second, it remains an uncertainty whether parties can expand the scope of judicial review in the FAA, at least it would depend heavily on which court reviews the case. The U.S. courts still have a discrepancy in treatment of allowing parties’ expand judicial review, but in the issue of parties’ narrowing down on the scope of judicial review by agreement, they vehemently object to this attitude. Because the written laws, such as the FAA and the New York Convention, have the most basic standard of protection, as they provide for dissenting views on awards. Due to the protection of parties, perseverance of public interests, and the need for a healthy development of arbitration, parties may not give up on these rights in advance unless and until the court curtails that right. The Article V of the New York Convention does not permit a review on the merits of the award, and this is widely confirmed by courts. The usual reasons advanced by courts for refusing to enforce an award are defects existing in the award, as for example, the arbitral agreement is invalid, the arbitral procedure or the composition of the arbitral tribunal is flawed, the award extra or ultra petita, the result of the award is not binding, the award is vacated in the original country, as well as the public policy was disregarded.[71]
The U.S courts allow for review of awards and to vacate them on the process. The parties in whose favour an award is made are very likely to go to the Appeal Court after a court might have vacated the original award because they want the award to be enforced. And there are chances that the awards will still be effectively enforced if the parties appeal in France or other counties which are parties to European Convention. That is because the reasons for a vacatur in French law[72] or European Convention on International Commercial Arbitration are narrowly defined.[73] As a result, if an award is vacated by U.S. courts, it does not constitute a sufficient reason to be vacated under French Law or European Convention, and it can therefore still be enforced. Moreover, if the U.S. court vacates an award on the grounds of “manifest disregard of law”, it can be enforced under French law or European Convention on International Commercial Arbitration. Consequently, if the parties have assets in France or one of the countries to European Convention,[74] it is not recommended when parties choose to expand judicial review on awards. Even if the award is preposterous and is vacated due to breach of applicable law, the courts in some jurisdiction may not prevent the awards from being enforced to protect the parties.[75]
As far as the “final and binding” argument goes, there is another case dealing with the capability of an arbitral agreement. The French New Code of Civil Procedure[76] grants the parties the right to choose the applicable procedural law or to choose the procedural law from an arbitration institution where the award is made. It permits the parties to choose the law which should govern the proceedings in their arbitral agreement, and this means they have to make a decision on the applicable law at the beginning of the agreement. If they fail to do this, the tribunal has to make the decision, “as may be necessary.” According to the Swiss Private International Law Statute, similarly, provides that parties are free to choose the arbitral procedure. This precludes the tribunal from making the decision for them.[77] In both cases, the tribunal needs to “assure equal treatment of the parties and the rights of the parties to be heard in an adversarial procedure.”[78] Even before the Act was adopted, Swiss Courts respected the parties’ right of choosing the arbitral procedure. For instance, in Muller v. Bergesen,[79] the parties made a charter party agreement, in which was contained an arbitration clause providing for arbitration in New York. It supplemented that the arbitration would be conducted under the New York law, and the award would be “final and binding on the parties.” When Bergesen sought to enforce an award against Muller in Switzerland, Muller contended that it was not binding according to Article V(1)(e) of the New York Convention.[80] It insisted that, according to the New York Convention, the award could only be binding and enforceable when it had been confirmed in New York courts which event had not taken place at that time.[81] On the other hand, Bergesen insisted the award was “final and binding on the parties” under arbitration clauses. Both the Court of First Instance of Zurich and the Court of Appeal of the Canton of Zurich decided that the award was enforceable. Muller appealed to the Swiss Federal Supreme Court, and the Court rejected the appeal, inter alia, because it held the arbitration agreement in which it was stated that the award was final and binding excluded the New York Civil Practice Law and Rules. The Court declared the New York Law was only applicable when the party did not make any arbitration agreement.[82]
There remains a question is the Convention provides that a court granting enforcement of a foreign award cannot review the merits of award. This idea is generally accepted by many. The main reason for the prohibition against reviewing merits of the award is that among the reasons for refusal of enforcement, they do not consist of errors of law or of fact of the arbitrator.[83] Moreover, the power of the enforcement judge is limited to the Conventions. Therefore, when the party against whom the award had been made asks to vacate it, for reason that it deals with a different matter than that transacted about or a matter not contemplated by the terms of the submission to arbitration, or consists of matters beyond the scope of arbitration, the court ought to review the award to examine whether it is justifiable.[84] The court also has the right to review to examine if it is compatible with the reasons under Article V(2) of the Convention. The jurisdiction of the court, however, falls within the scope of checking whether there are reasons in Article V for vacating the award. Therefore, the review of the court does not include reviewing the arbitrator’s findings of facts.[85]
 
VIII. Conclusion
 
Party autonomy is the basic principle of arbitration. Under party autonomy, parties can agree to take disputes to arbitration rather than file a suit in the regular court, to designate arbitral institution and law, and to make the award final and binding. But is it within parties’ right to make an agreement to stipulate every thing in arbitration, including judicial review of the award?[86] If parties can choose the scope of judicial review, they will discard the award’s characteristics of being final and binding at the same time, and thus the finality and independence will disappear.[87] Therefore, arbitration will be the first step toward litigation. To expand judicial review, though practically feasible, is improper on the grounds that it reduces the capability and potency of arbitration. In the case of Chicago Typographical Union,[88] the court pointed out those parties cannot contractually expand judicial review; they cannot by contract create the federal jurisdiction.
Pro-arbitration campaigners believe that parties can choose to expand judicial review under their agreement, because “the arbitration is the product of both parties.” Due to recognition of party autonomy, that parties can agree to have expanded judicial review is similar to their agreeing to include any other clause in the arbitral agreement. Hence, according to the FAA, the arbitral agreement must be enforced under its clauses, and the expanded judicial review should be enforced under parties’ agreement.[89] Those against this position believe that expanded judicial review should be severely restricted in the arbitral agreements, because the arbitration is an independent event. The expansion of judicial review will collide with the FAA, for it changes the arbitral procedure, and creates new and varied obligations for courts.[90]
One of the advantages of arbitration is that the arbitral award is final and binding under parties’ agreement, and this helps to solve disputes quickly within this system. If parties agree to have expanded judicial review, it emphasizes party autonomy, but breaks some advantages of the arbitration at the same time. For instance, the party against whom an award has been handed down usually exercises related rights whether or not he really believes there is a mistake existing in recognition of fact or applicable law. This will break the efficiency of arbitration as well as the finality of arbitral award. It is not beneficial for the cost of arbitration and it also increases the court’s burden. What’s worse, it leads to the increase of actual expense and procrastination, breaking the purpose of arbitration and parties’ purpose of using arbitration.
Article V of New York Convention, 1958, provides that foreign arbitration can be recognized, enforced, and vacated. The court, however, can only review the procedure of arbitration with the reasons listed in the New York Convention, but not the substantive contents and issue of law in the award.[91] However, the reasons listed in the Article V are limited. It does not constitute good reason for a vacatur if the arbitrator makes a mistake in law or if the fact and the contents of the award do not match. The reasons for taking an award to arbitration are limited; parties can not make an agreement to change these reasons, for example, asking the court to review issues of law in the award. Moreover, according to Section 10 of the FAA, the responsibility of courts is not reviewing the contents of the award, but reviewing whether the arbitral procedure is correct before the award goes into enforcement in other places, and if it has any defect, the court is obliged to vacate it.[92] This writer hopes that somehow we can expand parties’ autonomy by the parties’ agreeing to judicial review. However, considering the nature of arbitration, the FAA, and the 1958 New York Convention, judicial review may conflict with the functions of arbitration because it will delay the dispute-resolving process, go against the independence of arbitration, and break confidentiality of parties and disputes. We also hope that arbitration will be independent from judicial review, not to be a “bed fellow” of litigation. We can make arbitration final as well as binding, and truly an expeditious way of resolving disputes.