Can an arbitrator award punitive damages?

In Texas, the answer to whether an arbitrator can award punitive damages is generally, no. Punitive damages are a type of compensation awarded by a court to further punish a defendant for egregious conduct. According to both Texas state and federal laws, punitive damages are prohibited in arbitration proceedings. This means that an arbitrator cannot award punitive damages, even though the arbitrator may have the authority to award other types of damages. The purpose of punitive damages is to deter a defendant from engaging in wrongful conduct in the future. Since arbitration proceedings are private and not subject to the scrutiny of the public, the punitive effect of such damages would not be applicable. Additionally, arbitration awards are generally considered to be final and binding, meaning parties cannot challenge them in court or appeal the decision. In general, if parties are seeking punitive damages, they should seek relief through a court rather than through arbitration. While courts have the discretion to award punitive damages, arbitrators do not have that same authority. Punitive damages are rightfully reserved for judicial bodies that have the capability to assess a defendant’s conduct and grant appropriate punishment.

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