South Carolina Arbitration Act: Compelling, Vacating, and Confirming

The South Carolina Arbitration Act, codified at Title 15, Chapter 48 of the state code, makes written agreements to arbitrate valid and enforceable, sets the ground rules for the proceeding, and lets a court turn the arbitrator’s decision into a judgment. It also sets a hard 90-day deadline to challenge an award and carves out several categories of disputes, including most insurance and personal injury claims, that cannot be arbitrated under it at all.¹

What the Act Covers and What It Excludes

The Act applies to any written agreement in which parties commit to resolve existing or future disputes through arbitration. That sweeps in most commercial contracts, real estate deals, and business-to-business relationships. The exclusions in Section 15-48-10(b) are broader than people expect:²

Agreements that expressly say the Act does not apply. Parties can arbitrate outside the statutory framework if they say so.
Employer-employee agreements, unless the agreement specifically opts in. Even with an opt-in, workers’ compensation claims, unemployment compensation claims, and collective bargaining disputes cannot be brought under the Act.
Pre-dispute arbitration clauses entered into during a lawyer-client or doctor-patient relationship. “Doctor” covers a broad range of licensed medical professionals.
Any claim arising from personal injury, whether framed in contract or tort.
Claims by an insured person or beneficiary under any insurance policy or annuity contract.

The insurance exclusion is the one that trips people up. An arbitration clause tucked into an insurance policy is not enforceable under this Act, no matter how carefully drafted.

Family law disputes sit on a separate track. South Carolina’s Family Law Arbitration Act allows parties to arbitrate most issues coming out of a separation or divorce, including property division, alimony, and custody. The divorce itself, adoptions, terminations of parental rights, and allegations of child or spousal abuse cannot be arbitrated.³

When Federal Law Takes Over Instead

If your contract touches interstate commerce, the Federal Arbitration Act controls and preempts state rules that single out arbitration for disfavored treatment.⁴ South Carolina’s Act governs contracts that stay within the state: purely local transactions between South Carolina parties doing business entirely inside its borders. Courts read the FAA’s reach broadly, so anything involving out-of-state parties, a national company, or goods and services crossing state lines usually falls under federal law rather than Chapter 48.

Starting Arbitration and Getting a Court to Compel It

A party begins by serving a written demand on the other side identifying the dispute and the relief sought. The Act does not require a specific format, but vague demands invite objections and delay.

If the other party refuses to participate, you can petition the court to compel arbitration under Section 15-48-20. If the opposing party denies that an agreement exists, the court holds a quick hearing on that narrow question and orders arbitration if it finds one. The court’s role is limited to two questions: is there a valid agreement, and does it cover this dispute? It does not weigh in on the merits.²

The reverse also works. A party that believes no valid agreement exists can ask the court to stay arbitration, and the court will try that issue quickly.

How Arbitrators Are Chosen

If the agreement spells out a selection method, that method controls. Where the agreement is silent, the default is not a single arbitrator but a panel of three: each side picks one, and those two select the third.² Many agreements sidestep this by naming an arbitration organization or requiring the parties to agree on a single arbitrator. The choice between one arbitrator and three affects cost, speed, and strategy, so the clause deserves attention when you sign.

A neutral arbitrator who shows evident partiality creates grounds to throw out the eventual award, so both sides have reason to take selection seriously.

How Hearings Run

Hearings are less formal than trials but still structured. Each side presents evidence, calls witnesses, and argues. The arbitration agreement often sets procedural rules; when it does not, the arbitrator has broad discretion.

Arbitrators can issue subpoenas compelling witnesses to appear and produce documents. They are not bound by the South Carolina Rules of Evidence, though they may reference them when weighing reliability. Testimony can be live or, if the arbitrator allows, by deposition or affidavit. Cross-examination is permitted but tends to be shorter and more focused than in court.

The Act also allows additional parties to be joined if complete relief cannot be granted without them, or if a non-party has a stake that could be harmed by absence.² Joinder in arbitration is unusual across states, and it gives South Carolina arbitrators real power to pull all necessary parties in.

Challenging an Arbitration Agreement Before You’re Bound

Because the Act preserves any grounds “at law or in equity for the revocation of any contract,” standard contract defenses apply to arbitration clauses.¹ The most common defense is unconscionability, which has two prongs. Procedural unconscionability asks whether the party had a meaningful choice. Substantive unconscionability asks whether the terms are so one-sided that no reasonable person would accept them.

South Carolina courts have found arbitration clauses unconscionable where the weaker party had no real bargaining power and the terms were oppressive. In a 2024 Court of Appeals decision, 315 Corley CW LLC v. Palmetto Bluff Development, LLC, the court struck down an arbitration clause on both prongs even though the plaintiffs were wealthy real estate buyers, reasoning that unequal bargaining and one-sided terms were enough.

Fraud, duress, and lack of capacity also work. The key limitation: the defense must target the arbitration clause specifically, not the contract as a whole. You cannot avoid arbitration by arguing the whole contract was fraudulently induced. The question is always what was wrong with the agreement to arbitrate.

The 90-Day Window to Vacate an Award

Awards are final and binding, and courts will not second-guess the arbitrator’s reasoning. The Act lists narrow grounds on which a court must vacate:⁵

The award was procured by corruption, fraud, or other undue means.
A neutral arbitrator showed evident partiality, or any arbitrator engaged in misconduct that prejudiced a party.
The arbitrator exceeded their powers by deciding issues outside the agreement or granting unauthorized relief.
The arbitrator refused to hear material evidence or denied a reasonable postponement, prejudicing a party’s ability to present its case.
There was no agreement to arbitrate, the issue was not already resolved in court, and the objecting party did not participate in the hearing without raising the point.

What is not a ground: that a court would have decided differently or could not have granted the same type of relief. The statute rules that out.

The deadline is strict. A motion to vacate must be filed within 90 days after the award is delivered. If the challenge is based on fraud or corruption, the 90 days runs from when the party knew or should have known about the misconduct. Miss it and you lose the right to challenge the award. When a court does vacate, it can order a rehearing before new arbitrators, or before the original panel if the defect was procedural.

Modifying or Correcting an Award

Not every problem warrants throwing out the whole award. Courts can modify or correct in three situations:⁶

An obvious miscalculation of figures or a wrong name, address, or property description.
A ruling on a matter the parties never submitted, where that piece can be removed without affecting the rest.
An imperfection in form that does not touch the merits.

The same 90-day deadline applies. A party can file motions to vacate and to modify in the alternative, hedging in case the stronger challenge fails. If the court grants the modification, it confirms the award as corrected. If neither motion succeeds, the court confirms the award as originally issued.

Confirming and Enforcing an Award

An award does not automatically carry the weight of a court judgment. The winning party has to apply to the court for confirmation. The court confirms unless the losing party has timely raised grounds to vacate or modify. It does not re-examine the merits.²

Once confirmed, the award becomes a judgment enforceable like any other. The court can also award costs for the confirmation proceedings and any subsequent enforcement work. Standard collection tools become available: execution against property, and for judgments requiring some action other than paying money, contempt sanctions.⁷

If the losing party tries to hide or transfer assets, South Carolina’s fraudulent transfer statute lets courts void conveyances made with intent to delay, hinder, or defraud creditors.⁸ For judgments requiring specific performance or ongoing obligations, Section 15-35-180 provides that a certified copy can be served on the party, and refusal to comply may be punished as contempt, which can include fines or, in serious cases, incarceration.⁷

Attorney Fees

Under the American rule, each side pays its own attorney fees unless a contract or statute says otherwise. That applies in arbitration too. If the agreement includes a fee-shifting clause, the arbitrator can enforce it. Without one, each party bears its own legal costs.

Drafting matters. A fee-shifting provision that ties attorney fees to recovering a specific type of damages may be read narrowly, leaving a prevailing party unable to recover fees if the arbitrator finds liability but not that particular relief. Language awarding fees based on prevailing on any claim, independent of the damages recovered, avoids that trap. The court can also tack on costs for the confirmation proceedings once the award reaches the judicial stage.²

1
South Carolina Legislature. South Carolina Code 15-48-10 – Validity of Arbitration Agreement; Exceptions From Operation of Chapter
2
South Carolina Legislature. South Carolina Code Title 15 Chapter 48 – Uniform Arbitration Act
3
South Carolina Legislature. 2015-2016 Bill 4001 – Family Law Arbitration Act
4
GovInfo. 9 USC 2 – Validity, Irrevocability, and Enforcement of Agreements to Arbitrate
5
South Carolina Legislature. South Carolina Code 15-48-130 – Vacating an Award
6
South Carolina Legislature. South Carolina Code 15-48-140 – Modification or Correction of Award
7
South Carolina Legislature. South Carolina Code Title 15 Chapter 35 – Judgments and Decrees Generally
8
South Carolina Legislature. South Carolina Code 27-23-10 – Conveyances to Defraud Creditors; Transfers of Income and Property to Avoid Paying Child Support