Ala. Workers’ Compensation Fund’s Contribution Action Sent to Arbitration

MONTGOMERY, Ala. — A federal judge has compelled arbitration of an action in which an Alabama self-insured fund demands contribution from its reinsurer for sums the fund paid to resolve a workers’ compensation claim, ruling that the dispute falls within the arbitration clause in the parties’ reinsurance contract.

However, in the March 31 order, Judge Emily C. Marks of the U.S. District Court for the Middle District of Alabama stopped short at dismissing the action, explaining that the Federal Arbitration Act empowers the court to stay the case while the parties submit to arbitration.

In January 2003, General Reinsurance Corp. …