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Arbitration

Is an arbitrator in Israel personally liable for mistakes or negligence?

Generally no. Section 30 of the Arbitration Law 5728-1968 grants an arbitrator immunity from liability for anything done in good faith in the performance of their function. An arbitrator who makes an honest error of fact or law, or who is merely negligent in conducting the proceeding, is not personally liable in damages. The protection does not extend to acts done in bad faith, fraud, or willful misconduct. A party unhappy with the outcome must use the statutory routes of challenge or setting aside, not a negligence suit against the arbitrator.

The immunity exists to protect the integrity of the process. If arbitrators could be sued every time a losing party disagreed with a finding, no qualified person would accept the role, and arbitrators would be pressured to favor the party most likely to litigate. Section 30 therefore shields the arbitrator for acts within the scope of the function, provided they acted in good faith. The line is drawn at good faith rather than at the quality of the decision, so an arbitrator can be wrong, even badly wrong, on the law or the evidence and still be immune. What falls outside the shield is conduct tainted by dishonesty, corruption, or a deliberate disregard of duty. The proper remedy for a flawed award is the supervisory jurisdiction of the court, through the grounds for setting aside an award and the limited routes for challenge, not a personal claim.

For foreign parties, the practical takeaway is to focus energy on the award, not on the arbitrator. If you believe the arbitrator exceeded their authority, denied a fair hearing, or decided a matter not submitted to them, those are recognized grounds to ask the court to set the award aside within the statutory deadline. Allegations of bias or misconduct should be raised promptly and through the correct procedure, since sitting on them can amount to waiver. Choosing an arbitrator with a strong reputation, and using clear institutional rules, reduces the risk of process failures in the first place. Our guide to the Israeli arbitration process sets out how appointment, conduct, and award stages fit together.

⚖ In Practice
  • Governing law: Section 30, Arbitration Law 5728-1968 (arbitrator immunity for good-faith acts)
  • Competent authority: District Court (Beit Mishpat Mehozi) for setting aside and supervisory applications
  • Scope of immunity: covers honest errors of fact or law and ordinary negligence within the arbitral function
  • Limit: no protection for bad faith, fraud, corruption, or willful misconduct
  • Correct remedy: an application to set aside the award, generally within 45 days, rather than a damages suit against the arbitrator

From the full guide: The Arbitration Process in Israel, Step by Step

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Get a Free Consultation with Adv. Eli ShimonyPrepared under the direction of Adv. Eli Shimony, Eli Shimony Law Office · Editorial policy

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