Case of the Day: Argentine Republic v. National Grid plc
Posted on March 16, 2011
The case of the day, Argentine Republic v. National Grid plc (D.C. Cir. 2011), shows the importance of compliance with the statutory time limits in the FAA. The case involved another UK investor arbitration against Argentina on account of measures it took to deal with its financial crisis (we previously reported on Argentina v. BG Group, which also arose out of the Argentine crisis and also involved a claim by a British investor). The tribunal found Argentina liable and awarded the investor $53 million.
Under § 12 of the FAA:
Notice of a motion to vacate, modify, or correct an award must be served upon the adverse party or his attorney within three months after the award is filed or delivered.
Argentina filed its motion to vacate the award within the time permitted, but it did not serve the motion. Instead, it filed a motion for an extension of time to serve the motion under Rule 6(b)(1), which provides:
When an act may or must be done within a specified time, the court may, for good cause, extend the time: (A) with or without motion or notice if the court acts, or if a request is made, before the original time or its extension expires; or (B) on motion made after the time has expired if the party failed to act because of excusable neglect.
Before the court ruled on the motion for an extension of time, Argentina and the investor entered into a stipulation in which the investor “agree[d] to accept service of process of the Petition filed by [Argentina], without waiving any defenses that [National Grid] has in this action, including but not limited to defenses based on the timing of service.” The district court then dismissed the motion for an extension of time as moot and dismissed Argentina’s motion to vacate the award on the grounds that Argentina had not timely served its motion. Argentina appealed.
The court affirmed. It held that the investor, far from waiving its defense to the timeliness of the service, had expressly preserved it in the stipulation. The question boiled down to whether the district court abused its discretion by dismissing as moot the motion for an extension of time. But because a statutory time limit cannot be extended by a motion under Rule 6, the court held that the district court had not abused its discretion.
The court went on to affirm the order granting the investor’s cross-motion to confirm the award, noting that Argentina could have, but didn’t, make arguments in opposition to the motion.