Consolidation Question Should be Considered by New Arbitration Panel, 3rd Cir. Affirms

PHILADELPHIA — The question of whether related reinsurance disputes should be consolidated must be determined by a new panel of arbitrators chosen according to the express terms of the reinsurance agreement, a federal appeals court has affirmed.

In a Dec. 6 opinion, the 3rd Circuit U.S. Court of Appeals explained that having an earlier-convened arbitration panel from a previous arbitration decide the new issue would disregard the agreement’s express language.

From 1991 to 1996, Pennsylvania National Mutual Casualty Insurance Co. entered into several excess-of-loss reinsurance treaties with multiple reinsurers, including Everest. The treaties were comprised of layers defined by increasing …