Churchill Financial Management Corp.v.Clearnexus, Inc.
ClearNexus obtained a $255,021 arbitration award against Churchill Financial Management after alleging that Churchill terminated a service contract without proper notice. The trial court confirmed the award and rejected Churchill’s argument that tribal sovereign immunity barred the arbitration. Churchill appealed, arguing that the arbitration clause did not waive the immunity of the tribe under which it was incorporated and that the immunity defense had been waived by litigation conduct. The Georgia Court of Appeals held that tribal sovereign immunity is a jurisdictional issue that could be raised on appeal and that the arbitration clause did not itself establish a valid waiver by the tribe. Because the arbitrator’s authority depended on a valid waiver, the trial court erred by confirming the award without resolving that threshold issue. The court vacated the confirmation order and remanded for further proceedings.
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