Pennsylvania Arbitration Act: Agreements, Hearings, and Awards

The Pennsylvania Arbitration Act, codified at 42 Pa.C.S. Chapter 73, Subchapter A, governs private disputes that the parties agreed in writing to resolve outside court. It makes arbitration agreements enforceable, gives courts a narrow supervisory role, and sets tight rules for confirming, modifying, or vacating an award. If you signed a contract with an arbitration clause, or you are staring at an award you want to challenge, this is the framework that usually controls.

Pennsylvania actually runs several arbitration tracks in parallel, and the first thing to figure out is which one applies to you. The rules for enforcement, judicial review, and appeal are meaningfully different across them.

Which Arbitration Framework Applies to You

Chapter 73 divides arbitration into four subchapters, and each operates by its own rules.

Statutory arbitration under Subchapter A is the default framework for disputes where the parties signed a written agreement to arbitrate. It sets out how to compel arbitration, run a hearing, and confirm or vacate the award.
Common law arbitration under Subchapter B covers nonjudicial arbitration that falls outside the statutory scheme. Awards are binding and can only be overturned if the challenger clearly shows a party was denied a hearing, or that fraud, misconduct, corruption, or other irregularity produced an unjust, inequitable, or unconscionable result.¹
Compulsory court-annexed arbitration under Subchapter C applies to civil cases where the amount in controversy is $50,000 or less. A panel of three attorneys hears the case, and either party can appeal for a trial de novo.²
Family law arbitration under Subchapter D follows the Uniform Family Law Arbitration Act. It covers many family disputes but cannot grant a divorce, terminate parental rights, approve an adoption, or determine a child’s status in juvenile proceedings.³

The track matters most when a losing party wants to challenge the outcome. Subchapter A gives you five specific grounds for vacatur. Common law arbitration under Subchapter B is harder to overturn because a party must show an outright denial of a hearing, or fraud, misconduct, or corruption that produced an unjust result. Check your contract’s arbitration clause and any applicable court rules to figure out which track you are on.

When an Arbitration Agreement Is Enforceable

A written agreement to arbitrate an existing dispute, or a contract clause requiring future disputes to be arbitrated, is valid, enforceable, and irrevocable under Pennsylvania law. The only exception is a legal defense that would invalidate any contract, such as fraud, duress, or unconscionability.⁴ An arbitration clause gets the same treatment as any other contract provision. Changing your mind after signing is not enough.

These clauses turn up in commercial contracts, employment agreements, consumer transactions, real estate deals, and construction contracts. Courts generally enforce them but do scrutinize whether the clause was fairly presented. A clause buried in fine print or paired with terms that strip away basic rights can face an unconscionability challenge.

Non-signatories are another live issue. In Pisano v. Extendicare Homes, Inc., the Superior Court held that a nursing home’s arbitration clause signed by the decedent did not bind family members bringing a separate wrongful death claim, because wrongful death is an independent action belonging to the survivors rather than the decedent’s estate.⁵

Family disputes carry their own rule. Arbitration agreements covering child custody or child support that arise after the agreement is made are unenforceable unless the parties reaffirm the agreement after the dispute surfaces, or a court approved the agreement during a family law proceeding.³

Federal Limits on Arbitration Clauses

Two federal laws override Pennsylvania’s arbitration rules in specific situations. The Federal Arbitration Act applies when a contract involves interstate commerce, which federal courts read broadly.⁶ If a contract touches interstate commerce, the FAA generally preempts state law that singles out arbitration agreements for disfavored treatment. The U.S. Supreme Court reinforced this in AT&T Mobility v. Concepcion, holding that states cannot impose rules that obstruct the FAA’s goal of enforcing arbitration agreements as written.⁷ For purely local contracts with no interstate component, the Pennsylvania Arbitration Act governs on its own.

The Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act, signed in 2022, lets a person alleging sexual assault or sexual harassment void any pre-dispute arbitration agreement that would otherwise force them into arbitration. The choice belongs entirely to the person making the allegation, and it cannot be waived by contract.⁸

Starting Arbitration, and Forcing the Other Side to Show Up

Arbitration typically begins with a written demand referencing the contract’s arbitration clause and describing the dispute and the relief sought. If the contract names an arbitration provider like the American Arbitration Association or JAMS, the initiating party follows that organization’s filing rules and pays its administrative fees.

When the other side refuses to arbitrate despite a binding clause, you can petition the court of common pleas to compel arbitration. The court moves quickly on this. If the opposing party denies that an agreement exists, the court holds a summary determination on that issue alone. If the agreement is valid, the court orders arbitration and will not look at whether the underlying dispute has merit.⁹ The reverse is also available: if someone starts an arbitration and you believe no valid agreement exists, you can ask the court to stay the proceedings.

Once a court orders arbitration, or while an application for such an order is pending, any related lawsuit is stayed. If the arbitrable issue is separable from the rest of the case, the stay can apply to just that portion.⁹

One trap: arbitration does not pause the statute of limitations. A contract dispute still has to be initiated within the applicable window, which is four years for most written and oral contract claims.¹⁰ Miss it and the claim can be forfeited regardless of what the arbitration agreement says.

How Arbitrators Get Picked

If the agreement spells out a selection method, that method controls. Many contracts specify a single arbitrator or a panel of three, sometimes with required qualifications like industry experience or a law license. If the agreement is silent, or the agreed method breaks down, either party can ask the court to appoint one or more arbitrators. A court-appointed arbitrator holds the same authority as one the parties named in the contract.¹¹

When an arbitration provider administers the case, the provider handles selection through its own roster and procedures. AAA and JAMS both maintain panels with different specializations and give each side a role in selection, usually by striking names from a list.

Impartiality is enforced primarily through the vacatur process. An award can be thrown out if the losing party shows evident partiality by an arbitrator who was supposed to be neutral.¹² Institutional providers like AAA also impose their own disclosure rules, and a failure to disclose a conflict is a reliable path to having an award overturned.

Inside the Hearing

Arbitration hearings run less formally than trials, but the statute still sets procedural guardrails. Arbitrators acting as a panel decide by majority vote unless the agreement says otherwise. They can administer oaths, and all laws compelling testimony under subpoena apply to arbitration proceedings.

Arbitrators can issue subpoenas for witnesses and documents in the same form used in civil court, with service following the normal civil rules. Arbitrators cannot enforce a subpoena on their own; if a witness ignores it, a party or the arbitrators can apply to the court for enforcement.¹³ The arbitrators can also permit depositions of witnesses who cannot be served with a subpoena or are unable to attend in person.

The award must be in writing, signed by the arbitrators who join in it, and delivered to each party by registered or certified mail or as specified in the agreement. If the agreement sets a deadline for issuing the award, the arbitrators must meet it; if none exists, either party can ask the court to impose one. A party who does not object before receiving the award waives the right to complain about timing later.¹⁴

While the arbitration is running, courts stay out. They do not second-guess evidentiary rulings, procedural choices, or the arbitrators’ reasoning. Judicial involvement during the hearing itself is limited to a handful of specific tasks: deciding whether a valid agreement exists, compelling a reluctant party to participate, staying a related lawsuit, enforcing subpoenas, and appointing arbitrators when the selection process breaks down.⁹

Turning the Award Into an Enforceable Judgment

An arbitration award does not automatically carry the weight of a court judgment. To make it enforceable, the prevailing party files a petition to confirm the award with the court of common pleas. The court must confirm unless the opposing party raises grounds for vacating or modifying it within the statutory time limits.¹⁵ Once confirmed, the award becomes a court judgment with full enforcement power, including wage garnishment and asset seizure.

If the losing party does not challenge the award within 30 days, the court confirms it without reviewing the merits. The court does not evaluate whether the arbitrators got the law right or weighed the evidence properly. Absent a timely challenge, confirmation is essentially automatic.

Vacating or Modifying an Award

Overturning an arbitration award is intentionally difficult. Pennsylvania law treats awards as final, and a party who simply disagrees with the outcome has no basis for relief. A motion to vacate must be filed within 30 days of receiving the award. If the challenge is based on corruption, fraud, or other improper means, the 30-day clock starts when the party knew or should have known about those grounds.¹²

The statute limits vacatur to five grounds:

Any ground that would apply under common law arbitration, meaning denial of a hearing or fraud, misconduct, corruption, or other irregularity that produced an unjust result.
Evident partiality by an arbitrator appointed as neutral, or corruption or misconduct by any arbitrator that prejudiced a party’s rights.
The arbitrators exceeded their authority by resolving issues beyond what the parties submitted.
Procedural misconduct, including refusing to postpone a hearing despite good cause, refusing to hear material evidence, or conducting the hearing in a way that substantially prejudiced a party’s rights.
No valid agreement to arbitrate existed, the issue was not already resolved in proceedings to compel or stay arbitration, and the party raised the objection during the hearing.

The statute is explicit that even if the arbitrators granted relief no court could have awarded, that alone is not a reason to vacate.¹² This is where most disappointed parties hit a wall. An arbitrator’s legal error, even an obvious one, is generally not grounds for vacatur.

Modification is a narrower remedy. A party can ask the court to correct the award within 30 days if it contains a mathematical error, if the arbitrators ruled on a matter not submitted to them, or if the award has a defect in form that does not affect the substance of the decision.¹⁴ A court that grants modification preserves the arbitrators’ substantive findings and corrects only the error. If a vacatur motion is denied and no modification request is pending, the court confirms the award.

Common Law Arbitration Sets an Even Higher Bar

If your arbitration falls under common law rather than the statutory framework, challenging the award is harder still. Under 42 Pa.C.S. 7341, a common law award is binding and cannot be vacated or modified unless the challenger clearly shows that a party was denied a hearing, or that fraud, misconduct, corruption, or other irregularity caused an unjust, inequitable, or unconscionable result.¹ There is no separate track for exceeded-authority claims or procedural complaints. The test is whether the process was fundamentally unfair or corrupt. If not, the award stands.

Compulsory Court-Annexed Arbitration for Smaller Cases

Many civil cases in Pennsylvania never reach a judge because they get routed to compulsory arbitration first. Under 42 Pa.C.S. 7361, civil matters where the amount in controversy is $50,000 or less, excluding interest and costs, must be submitted to a panel of three attorneys who serve as arbitrators. Cases involving title to real property are excluded.²

The critical difference from voluntary arbitration is the right to appeal. Any party unhappy with the panel’s decision can appeal for a trial de novo, a completely fresh trial before a judge or jury as if the arbitration never happened. The appealing party pays fees and costs set by court rules. If nobody appeals, the arbitration award is enforced like any other court judgment.²

If your case is under the $50,000 threshold, plan to go through compulsory arbitration before any courtroom trial. Prepare for it seriously even though a full trial remains available on appeal, because the panel’s decision stands unless someone actually files.

1
Pennsylvania General Assembly. 42 Pennsylvania Consolidated Statutes 7341 – Common Law Arbitration
2
Pennsylvania General Assembly. 42 Pennsylvania Consolidated Statutes 7361 – Compulsory Arbitration
3
Justia Law. 2024 Pennsylvania Consolidated Statutes Act 12 – Uniform Family Law Arbitration Act
4
Pennsylvania General Assembly. 42 Pennsylvania Consolidated Statutes 7303 – Validity of Agreement to Arbitrate
5
FindLaw. Pisano v. Extendicare Homes Inc (2013)
6
Office of the Law Revision Counsel. 9 USC 2
7
Justia U.S. Supreme Court. AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011)
8
Congress.gov. H.R.4445 – Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021
9
Pennsylvania General Assembly. 42 Pennsylvania Consolidated Statutes 7304 – Court Proceedings to Compel or Stay Arbitration
10
Pennsylvania General Assembly. 42 Pennsylvania Consolidated Statutes 5525 – Four Year Limitation
11
Pennsylvania General Assembly. 42 Pennsylvania Consolidated Statutes 7305 – Appointment of Arbitrators by Court
12
Pennsylvania General Assembly. 42 Pennsylvania Consolidated Statutes 7314 – Vacating Award by Court
13
Pennsylvania General Assembly. Pennsylvania Statutes Title 42 Pa.C.S.A. 7309 – Witnesses, Subpoenas, Oaths and Depositions
14
Pennsylvania General Assembly. 42 Pennsylvania Consolidated Statutes Chapter 73 – Arbitration
15
Pennsylvania General Assembly. 42 Pennsylvania Consolidated Statutes 7313 – Confirmation of Award by Court