Iron Hill Co. v. Cairone Construction Co. ( 2022 )

J-S36016-21
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
IRON HILL COMPANY, : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
Appellant :
:
v. :
:
CAIRONE CONSTRUCTION CO. :
:
Appellee : No. 513 EDA 2021
Appeal from the Orders October 16, 2020
In the Court of Common Pleas of Philadelphia County
Civil Division at No(s): Case ID 200300428
BEFORE: LAZARUS, J., KING, J., and COLINS, J.*
MEMORANDUM BY KING, J.: FILED FEBRUARY 23, 2022
Appellant, Iron Hill Company, appeals from the orders entered in the
Philadelphia County Court of Common Pleas, which denied its petition to
vacate the arbitration award entered in favor of Appellee, Cairone
Construction Company, and granted Appellee’s petition to confirm the
arbitration award in its favor. We affirm.
The trial court opinion set forth the relevant facts and procedural history
of this case as follows:
Appellant is a corporation organized under the laws of the
Commonwealth of Pennsylvania with its principal place of
business in Norristown, Pennsylvania. Appellee is a limited
liability company organized under the laws of the
Commonwealth of Pennsylvania with its principal place of
business in Jenkintown, Pennsylvania. The underlying
matter arises out of an appeal of an arbitration award.
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* Retired Senior Judge assigned to the Superior Court.
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In 2016, Appellant contracted Appellee to construct
trampoline pits for an indoor park in Hackensack, New
Jersey.[1] The project commenced in December 2016 and,
through the course of the project, numerous revisions were
made to the original plans for the trampoline pits. Based
upon these changes[,] Appellee submitted Change Order
Requests to Appellant. The Change Order Requests outlined
the additional work performed as well as the associated
additional cost. Appellee continued working on the project
and performed on the project.
On or about August 24, 2018, Appellee submitted a Demand
for Arbitration to the American Arbitration Association
(“AAA”).[2] Subsequently, Appellant filed a Response and
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1 Appellant was awarded the contract for construction of the trampoline park
and Appellant awarded the subcontract to Appellee to build the trampoline
pits.
2 Originally, Appellee had sued Appellant in New Jersey. After Appellant
objected on the basis of the arbitration clause and the case was dismissed,
Appellee initiated arbitration proceedings. The arbitration clause contained in
the parties’ agreement states:
Dispute Resolution
Any controversy or claim arising out of or relating to this
contract, [or] the breach thereof, shall be settled by
arbitration in accordance with the Construction Industry
Arbitration Rules of the American Arbitration Association,
and judgment upon the [award] rendered by the
arbitrator(s) may be entered in any court having jurisdiction
thereof. The parties specifically waive any rights under
state law to move to set the arbitration decision aside
and/or appeal, thus the arbitration decision shall be final
and binding. Any attorney’s fees incurred by the contractor
in enforcement of arbitration under this contract shall be
recoverable by the general contractor and will be paid by
the subcontractor. Subcontractor also agrees to be a party
to any arbitration between or among the general contractor,
owner, and/or other subcontractors if named as a party by
(Footnote Continued Next Page)
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Counterclaim, claiming a set-off for settling Subcontractor
Liens for two (2) of Appellee’s subcontractors. On June 20,
and June 21, 2019, a hearing was conducted before AAA
Arbitrator Mary Jo Gilsdorf, Esquire, in Philadelphia,
Pennsylvania.
On August 9, 2019, the Arbitrator: (1) found in favor of
Appellee and against Appellant, in regard to the unpaid
contract balance and the unsigned change orders; and, (2)
found in favor of Appellant and against Appellee, in regard
to Appellant’s counterclaim for settling the subcontractor
liens. On August 9, 2019, after accounting for the set-off,
the Arbitrator awarded Appellee $88,958.48 (the “2019
Arbitration Award”). After the inclusion of administrative
fees, the 2019 Arbitration Award total accrued to
$98,623.48, plus interest at 6.3 percent from August 24,
2018, until the date of payment.
On September 5, 2019, Appellant filed a Petition to Vacate
the 2019 Arbitration Award in the Court of Common Pleas of
Montgomery County, Pennsylvania, under Docket Number
19-21802 (First Petition to Vacate). On February 6, 2020,
the First Petition to Vacate was denied by the Honorable
Steven C. Tolliver, Senior.[3] Appellant did not file a motion
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the general contractor, and subcontractor shall be bound by
such arbitration decision. Both parties agree that this
subcontract shall be governed by the laws of the State of
Pennsylvania.
For any claim subject to, but not resolved by mediation, the
method of binding dispute resolution shall be Litigation in a
court of competent jurisdiction.
(Contract Between Contractor and Subcontractor, 12/15/16, at 3-4; R.R. at
35a-36a).
3 In its order, the court stated that Appellant’s petition to vacate was denied
and dismissed because the parties had arbitrated their dispute in Philadelphia
County. In a footnote to the order, the court stated: “Pursuant to 42 Pa.C.S.A.
§ 7321.28, [Appellant] may move for judicial relief in the court of the county
where the arbitration was held.” (Order of Montgomery County Court of
(Footnote Continued Next Page)
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for reconsideration or an appeal within thirty (30) days of
the date of the entry of the order denying the First Petition
to Vacate.
On March 5, 2020, Appellant filed a second Petition to
Vacate the 2019 Award in the Court of Common Pleas of
Philadelphia County, Pennsylvania (Second Petition to
Vacate). On [May 4], 2020, Appellee filed a Petition to
confirm the 2019 Award in Philadelphia Common Pleas
Court. On October 13, 2020, oral argument was held
regarding Appellant’s Second Petition to Vacate and
Appellee’s Petition to Confirm the 2019 Award. On October
16, 2020, [by separate orders,] the trial court granted
Appellee’s Petition to Confirm and denied Appellant’s Second
Petition to Vacate.
On November 10, 2020, Appellant timely filed a Notice of
Appeal of both this court’s October 1[6], 2020, Orders to
the Commonwealth Court of Pennsylvania (“Commonwealth
Court”), which appeal [the] Commonwealth Court docketed
at 1160 CD 2020. On November 16, 2020, this court issued
a [Rule] 1925(b) Order seeking Appellant’s Statement of
[Errors] Complained Of within twenty-one (21) days. On
December 7, 2020, Appellant timely filed the required [Rule]
1925(b) Statement. On February 19, 2021, the
Commonwealth Court transferred the instant appeal to the
Superior Court of Pennsylvania (“Superior Court”), which
appeal the Superior Court docketed at 513 EDA 2021.
(Trial Court Opinion, filed March 29, 2021, at 1-3) (internal citations omitted).
Appellant raises the following two issues for our review:
Did the trial court err in finding that Appellant waived the
right to seek judicial review of the underlying arbitration
award for irregularities in the proceedings that resulted in
the rendition of an unjust, inequitable, or unconscionable
award?
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Common Pleas, 2/6/20, at 1 n.1; R.R. at 157a). See also 42 Pa.C.S.A. §
7321.28 (stating motion relating to application for judicial relief must be made
in court of county in which arbitration hearing was held).
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Did the trial court err in denying Appellant’s Petition to
Vacate Arbitration Award and granting Appellee’s Petition to
Confirm Arbitration Award, where irregularities in the
underlying arbitration proceedings resulted in the rendition
of an unjust, inequitable, or unconscionable award?
(Appellant’s Brief at 4).
As a preliminary matter, Appellee argues the Philadelphia County Court
of Common Pleas trial court had no jurisdiction to rule on the merits of
Appellant’s second petition to vacate, where Appellant filed the petition more
than 30 days after entry of the arbitration award based on Appellant’s initial
improper filing of the first petition to vacate in Montgomery County. To
resolve this issue, we must first decide which arbitration principles apply in
this case. This Court has explained:
Chapter 73 of the Pennsylvania Judicial Code governs
statutory, common law and judicial arbitration. Section
7301-7320 of Subchapter A apply to statutory arbitration
proceedings and are known collectively as the Pennsylvania
Uniform Arbitration Act (“UAA”). Section 7341 and 7342 of
Subchapter B apply to common law arbitration
proceedings.[4] Whether an arbitration agreement is subject
to the UAA (Sections 7301-7320 of Subchapter A) or
common law (Sections 7341-7342 of Subchapter B)
arbitration principles depends on whether the agreement is
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4 On June 28, 2018, the General Assembly approved legislative amendments
creating revised statutory arbitration standards under Pennsylvania law,
effective July 1, 2019. See 2018 Pa. Legis. Serv. Act 2018-55 (H.B. 1644);
see also 42 Pa.C.S.A. §§ 7321.1-7321.31. Section 7342 was also amended
to incorporate some of these revised standards in the legislative framework
applicable to common law arbitrations in Pennsylvania. See 42 Pa.C.S.A. §
7342(a). Here, the parties entered the contract containing the arbitration
clause at issue in 2016 and the arbitration hearings took place in June 2019,
before the amendments took effect on July 1, 2019. Thus, we will apply the
law in place before the amendments took effect.
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in writing and expressly provides for arbitration under the
UAA. Absent an express statement in the arbitration
agreement, or a subsequent agreement by the parties which
calls for the application of the UAA statutory provisions in
Subchapter A, an agreement to arbitrate is conclusively
presumed to be at common law and subject to the
provisions of Subchapter B.
Sage v Greenspan, 765 A.2d 1139, 1141 (Pa.Super. 2000), appeal denied,
566 Pa. 684, 784 A.2d 119 (2001) (internal citations omitted). In other words,
a written agreement to arbitrate which fails to specify the application of either
common law or statutory rules is properly considered as common law
arbitration. Snyder v. Cress, 791 A.2d 1198, 1200 (Pa.Super. 2002).
Further, “[a]n agreement to arbitrate in accordance with the Rules of the AAA
is an agreement pursuant to common law arbitration.” Midomo Co., Inc. v.
Presbyterian Housing Development Co., 739 A.2d 180, 183 (Pa.Super.
1999). See also Bucks Orthopaedic Surgery Assoc., P.C. v. Ruth, 925
A.2d 868, 871 (Pa.Super. 2007) (stating same).
Here, the parties’ arbitration clause states, in relevant part: “Any
controversy or claim arising out of or relating to this contract, [or] the breach
thereof, shall be settled by arbitration in accordance with the Construction
Industry Arbitration Rules of the American Arbitration Association[.]”
(Contract Between Contractor and Subcontractor, 12/15/16, at 3; R.R. at
35a). As the parties did not specify for the application of the UAA statutory
provisions in Subchapter A, or another similar statute, the agreement to
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arbitrate is presumed to be at common law.5 See Snyder, supra; Sage,
supra. The parties’ reference to be bound by the Rules of AAA further
demonstrates that common law arbitration principles apply in this case. See
Bucks, supra; Midomo, supra.The statutes governing common law arbitration before the amendments
took effect stated:
§ 7341. Common law arbitration
The award of an arbitrator in a nonjudicial arbitration which
is not subject to Subchapter A (relating to statutory
arbitration) or a similar statute regulating nonjudicial
arbitration proceedings is binding and may not be vacated
or modified unless it is clearly shown that a party was denied
a hearing or that fraud, misconduct, corruption or other
irregularity caused the rendition of an unjust, inequitable or
unconscionable award.
42 Pa.C.S.A. § 7341 (effective until June 30, 2019).6
§ 7342. Procedure
(a) General rule.—The following provisions of
Subchapter A (relating to statutory arbitration) shall be
applicable to arbitration conducted pursuant to this
subchapter:
Section 7303 (relating to validity of agreement to arbitrate).
Section 7304 (relating to court proceedings to compel or
stay arbitration).
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5 Based on the law cited in the briefs on appeal, the parties appear to agree
that common law arbitration principles apply.
6 We note that even if the amended versions of the statutes at issue applied,
the statutes relevant to this appeal were substantially similar before and after
the amendments.
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Section 7305 (relating to appointment of arbitrators by
court).
Section 7309 (relating to witnesses, subpoenas, oaths and
depositions).
Section 7317 (relating to form and service of applications to
court).
Section 7318 (relating to court and jurisdiction).
Section 7319 (relating to venue of court
proceedings).
Section 7320 (relating to appeals from court orders), except
subsection (a)(4).
(b) Confirmation and judgment.—On application of
a party made more than 30 days after an award is made by
an arbitrator under section 7341 (relating to common law
arbitration), the court shall enter an order confirming the
award and shall enter a judgment or decree in conformity
with the order. Section 7302(d)(2) (relating to special
application) shall not be applicable to proceedings under this
subchapter.
42 Pa.C.S.A. § 7342 (effective until June 30, 2019) (emphasis added). “This
Court has consistently interpreted section 7342(b) to require that any
challenge to the arbitration award be made in an appeal to the Court of
Common Pleas, by filing a petition to vacate or modify the arbitration award
within 30 days of the date of the award.” U.S. Claims, Inc. v. Dougherty,
914 A.2d 874, 877 (Pa.Super. 2006), appeal denied, 593 Pa. 729, 928 A.2d
1291 (2007). “A party must raise alleged errors in the arbitration process in
a timely petition to vacate or modify the arbitration award or the claims are
forever waived.” Id.-8-
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Section 7319 of the Statutory Arbitration Act, applicable in common law
arbitration proceedings pursuant to Section 7342(a), provides:
§ 7319. Venue of court proceedings
Except as otherwise prescribed by general rules:
(1) An initial application to a court under this
subchapter shall be made to the court of the county in which
the agreement prescribes that the arbitration hearing shall
be held or, if the hearing has been held, in the county
in which the hearing was held.
(2) If an application to a court cannot be made under
paragraph (1) the application shall be made to the court in
the county where the adverse party resides or has a place
of business or, if he has no residence or place of business in
this Commonwealth, to the court of any county.
(3) All subsequent applications to a court shall be
made to the court hearing the initial application unless that
court otherwise directs.
42 Pa.C.S.A. § 7319 (emphasis added).
In Mulnix v. Toll Brothers, Inc., No. 3248 EDA 2018, 2020 WL
7353363 (Pa.Super. Dec. 15, 2020) (unpublished memorandum),7 this Court
considered a procedural posture similar to this case. There, Toll Brothers filed
a petition to vacate a final arbitration award in the Bucks County Court of
Common Pleas, even though the arbitration hearings took place in
Philadelphia. The appellees subsequently filed a petition to confirm the
arbitration award in the Philadelphia County Court of Common Pleas. The
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7 We may rely on unpublished cases from this Court filed after May 1, 2019
for persuasive value. See Pa.R.A.P. 126(b).
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Philadelphia trial court granted the appellees’ petition to confirm, and Toll
Brothers appealed.
On appeal, the appellees claimed, inter alia, that Toll Brothers’ petition
to vacate should be treated as a legal nullity because it was not filed in the
proper venue, i.e., the Philadelphia County Court of Common Pleas. This Court
acknowledged that “the proper venue for Toll Brothers’ petition to vacate is
indisputably situated in Philadelphia County, which was the location of the
arbitration hearings in the instant case.” Id. at *4. Nevertheless, this Court
explained:
With respect to Toll Brothers’ petition to vacate that was
filed in an incorrect venue, Pennsylvania law provides a
straightforward solution to such erroneous submissions:
If an appeal or other matter is taken to or brought
in a court … of this Commonwealth which does not
have jurisdiction of the appeal or other matter, the
court … shall not quash such appeal or dismiss the
matter, but shall transfer the record thereof to the
proper tribunal of this Commonwealth, where the
appeal or other matter shall be treated as if
originally filed in the transferee tribunal on the
date when the appeal or other matter was first
filed …
42 Pa.C.S. § 5103(a) (emphasis added).
Instantly, there is no dispute that Toll Brothers’ petition to
vacate was filed within thirty days of the entry of a final
award by the arbitrator. Pursuant to the imperative
language of § 5103(a) quoted above, the petition to vacate
should have been transferred to the Philadelphia County
Court of Common Pleas and, critically, treated as if it had
been timely filed.
* * *
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… The mere fact that Toll Brothers’ petition was filed in the
wrong venue does not render it a legal nullity. See, e.g.,
Commonwealth v. Gross, [627 Pa. 383, 396, 101 A.3d
28, 36 (2014)] (“As venue is predominantly a procedural
matter, and pertains to the locality most convenient to the
proper disposition of a matter, dismissal is disproportionate
and unjust where a court merely finds another judicial
district provides a more appropriate forum.” (internal
citations and quotation marks omitted)).
Mulnix, supra at *4-*5 (some internal citations omitted).
Instantly, the parties arbitrated their dispute in Philadelphia County.
The arbitrator entered the award in favor of Appellee on August 9, 2019.
Within 30 days, Appellant filed the first petition to vacate in Montgomery
County on September 5, 2019. During the proceedings in Montgomery
County, Appellee objected on the basis of improper venue. The record
suggests the issue of improper venue was also discussed at a hearing before
the Montgomery County trial court on January 22, 2020. Thereafter, on
January 24, 2020, Appellant filed a petition to transfer the petition to vacate
from Montgomery County to Philadelphia County.
The Montgomery County trial court did not rule on the transfer petition;
instead, on February 6, 2020, the Montgomery County trial court denied and
dismissed the petition to vacate because Appellant had filed the petition in the
improper venue. In a footnote to its order, the court stated: “Pursuant to 42
Pa.C.S.A. § 7321.28, [Appellant] may move for judicial relief in the court of
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the county where the arbitration was held.”8 (Order of Montgomery County
Court of Common Pleas, 2/6/20, at 1 n.1; R.R. at 157a). Within 30 days of
that order, on March 5, 2020, Appellant filed the instant petition to vacate in
Philadelphia County.
Under Section 5103(a), the Montgomery County trial court should have
granted Appellant’s petition to transfer and transferred the first petition to
vacate to the Philadelphia County Court of Common Pleas, where it would
have been considered as timely filed. See 42 Pa.C.S.A. § 5103(a); Mulnix,
supra. Based on the language in the footnote of the Montgomery County trial
court’s order, Appellant reasonably filed a second petition to vacate in
Philadelphia County within thirty days of that order. Under these
circumstances, we decline to construe Appellant’s current petition to vacate
as a legal nullity, and we will reach the merits of the petition to vacate filed in
Philadelphia County.9
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8 The Montgomery County trial court cited to Section 7321.28, which is a post-
amendment provision. Similar to Section 7319, Section 7321.28 requires that
a motion relating to an application for judicial relief be made in the court of
the county in which the arbitration hearing was held. See 42 Pa.C.S.A. §
7321.28. Thus, under the pre or post-amendment statute, the law directed
Appellant to file the petition to vacate in Philadelphia County, where the
arbitration proceedings were held.
9 Appellee has filed a petition to strike in this Court based on Appellant’s failure
to ensure that all of the pertinent proceedings that took place in Montgomery
County are part of the certified record in this appeal. Alternatively, Appellee
asks this Court to remand so that Appellant can supplement the record with
those filings. Our review of the record confirms that most of the filings that
(Footnote Continued Next Page)
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In its issues combined, Appellant acknowledges that the arbitration
clause contained in the parties’ contract stated that the parties would be
bound by the arbitrator’s decision, where the contract states: “The parties
specifically waive any rights under state law to move to set the arbitration
decision aside and/or appeal, thus the arbitration decision shall be final and
binding.” (Appellant’s Brief at 13) (citing R.R. 35a). Appellant argues,
however, that it is not precluded from challenging irregularities in the
arbitration process, which Appellant insists resulted in the rendition of an
“unfair, inequitable, or unconscionable award.” (Appellant’s Brief at 12).
Appellant claims the arbitrator violated the AAA’s Construction Industry
Arbitration Rules in various ways including, inter alia, the failure to make
findings of fact and conclusions of law; the failure to permit Appellant to
respond to Appellee’s post-hearing submission following arbitration; and the
failure to apply Pennsylvania law to the proceedings.
Specifically, regarding the arbitrator’s alleged failure to apply
Pennsylvania law to the proceedings, Appellant argues that the arbitrator
applied her own “notion” of “construction law” by directing the parties to brief
the applicability of the “Leading Edge Doctrine,” when no such doctrine exists
____________________________________________
took place in Montgomery County are attached as exhibits to various filings in
the certified record before us. Although the transcript of the January 22, 2020
hearing in Montgomery County is not part of the record, the court’s order
denying and dismissing the petition to vacate makes clear the court did so on
procedural grounds based on improper venue. Because our review of the
record is not impaired here, we deny Appellee’s application to strike.
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in Pennsylvania. Appellant concedes that the arbitrator subsequently
amended her request once the parties informed her that they were unaware
of the “Leading Edge Doctrine,” and she clarified that she meant she wanted
the parties to “brief the effect of verbal directions in the field without written
change orders—even if there is language in the contract stating that all change
orders must be in writing.” (Id. at 17) (citing R.R. at 72a). Appellant submits
that the arbitrator’s amended direction demonstrates an ignorance of
Pennsylvania law, which requires that when the words of a written contract
are plain and unambiguous, the intent of the parties is to be ascertained from
the plain language of the contract and courts are not permitted to alter the
meaning of the contract under the guise of contractual interpretation.
Appellant further complains that the arbitrator’s failure to make findings
of fact and conclusions of law is particularly problematic where there is no
transcript of the arbitration proceeding. Under these circumstances, Appellant
maintains “one can only reasonably conclude that the arbitrator rendered her
decision based on neither the facts nor on Pennsylvania law, but merely on
her personal predilections and unfounded ‘notions’ of ‘construction law.’”
(Appellant’s Brief at 18-19). Appellant insists the arbitrator impermissibly
exceeded the scope of her authority under the arbitration agreement, which
required the arbitrator to apply Pennsylvania law, by applying her personal
“notion” of non-state-specific “construction law.” Appellant concludes it did
not waive judicial review of these types of procedural irregularities in the
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proceedings, and this Court should reverse the orders denying its petition to
vacate and granting Appellee’s petition to confirm, or vacate and remand for
further proceedings. We disagree.
Our standard and scope of review in this case are as follows:
Judicial review of a common law arbitration award is
severely limited as otherwise arbitration would be an
unnecessary stage of litigation, causing only delay and
expense without settling the dispute. The arbitrators are
the final judges of both law and fact, and an arbitration
award is not subject to a reversal for a mistake of either.
Neither we nor the trial court may retry the issues addressed
in arbitration or review the tribunal’s disposition of the
merits of the case. Rather, we must confine our review to
whether the appellant was deprived of a hearing or whether
fraud, misconduct, corruption or other irregularity tainted
the award. The appellant bears the burden to establish both
the underlying irregularity and the resulting inequity by
clear, precise, and indubitable evidence. In this context,
irregularity refers to the process employed in reaching the
result of the arbitration, not to the result itself.
Civan v. Windermere Farms, Inc., 180 A.3d 489, 493 (Pa.Super. 2018)
(quoting U.S. Spaces, Inc. v. Berkshire Hathaway Home Servs., Fox &
Roach, 165 A.3d 931, 934 (Pa.Super. 2017)). “[A] trial court order
confirming a common law arbitration award will be reversed only for an abuse
of discretion or an error of law.” Gargano v. Terminix Intern. Co., L.P.,
784 A.2d 188, 193 (Pa.Super. 2001).
“A cognizable irregularity may appear in the conduct of either the
arbitrators or the parties. [T]he phrase ‘other irregularity’ in the process
employed imports such bad faith, ignorance of the law and indifference to the
justice of the result as would cause a court to vacate an arbitration award.”
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F.J. Busse Co., Inc. v. Sheila Zipporah, L.P., 879 A.2d 809, 811 (Pa.Super.
2005), appeal denied, 587 Pa. 694, 897 A.2d 457 (2006) (internal citations
and some internal quotation marks omitted). “[A] common law arbitration
award is not reviewable for an error of law. Therefore, regardless of whether
the arbitrators committed an error of law, the arbitrator’s award cannot be
vacated on this basis.” Id. at 812. “In most cases where an irregularity is
alleged, our appellate courts have denied relief.” Chervenak, Keane & Co.,
Inc. (CKC Associates) v. Hotel Rittenhouse Associates, Inc., 477 A.2d
482, 485 (Pa.Super. 1984) (collecting cases).
[T]his Court has found irregularities rising to the level of the
denial of a fair hearing where the arbitrators: exceeded the
scope of the arbitration agreement, Ginther v. U.S. Fid. &
Guar. Co., … 632 A.2d 333, 335 (Pa.Super. 1993); made
an award for claims that were never raised, Mellon v.
Travelers Inc. Co., … 406 A.2d 759, 762 (Pa.Super. 1979),
or for claims that were not raised against the party against
whom they were awarded, Alaia v. Merrill Lynch, Pierce,
Fenner & Smith Inc., 928 A.2d 273, 277 (Pa.Super.
2007); and had an undisclosed, ongoing business
relationship with one of the parties, James D. Morrisey,
Inc. v. Gross Const. Co., … 443 A.2d 344, 349 (Pa.Super.
1982).
However, this Court has held that no irregularity warranting
modification occurred where the allegations were that the
arbitrators: applied the wrong state’s law, Racicot v. Erie
Ins. Exch., 837 A.2d 496, 500 (Pa.Super. 2003); failed to
award fees as provided by a relevant statute, [F.J. Busse
Co., supra]; made an award contrary to a policy exclusion,
Hain v. Keystone Ins. Co., … 326 A.2d 526, 528
(Pa.Super. 1974); and made an incorrect determination
whether a person was an insured under a contract.
Prudential Prop. & Cas. Ins. Co. [683 A.2d 683, 684
(Pa.Super. 1996)].
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In sum, “only claims which assert some impropriety in the
arbitration process may be the subject [of] an appeal—to
the exclusion of appeals which seek review of the merits.”
[Snyder, supra at 1201]. “[N]either we nor the trial court
may retry the issues addressed in an arbitration proceeding
or review the tribunal’s disposition of the merits of the
case.” F.J. Busse Co., [supra] at 811.
D’Amelia v. Toll Bros., Inc., 235 A.3d 321, 329-30 (Pa.Super. 2020).
Instantly, in evaluating the merits of Appellant’s current petition to
vacate, the trial court reasoned:
In 2020, Appellee filed a Petition to Confirm the 2019
Arbitration Award. Subsequent to oral argument, the trial
court: (1) found that the 2016 Construction Contract was
valid; (2) found that the 2016 Construction Contract was
duly signed by both parties; and, (3) found that Appellant
had waived the right to appeal the 2019 Arbitration Award
[based on the contract language]. Furthermore, Appellant
has provided no evidence, pursuant to 42 Pa.C.S. § 7341,
to show that Appellant was “denied a hearing or that fraud,
misconduct, corruption or other irregularity” caused the
2019 Arbitration Award. Therefore, the trial court properly
granted Appellee’s Petition to Confirm and properly denied
Appellant’s Section Petition to Vacate.
(Trial Court Opinion at 5). We see no reason to disrupt the court’s decision.
Here, Appellant claimed the arbitrator violated the AAA’s Construction
Industry Arbitration Rules. Regarding the arbitrator’s improper reference to
the “Leading Edge Doctrine,” upon questioning from the parties, the arbitrator
explained that she had used that phrase in the colloquial sense “from a
construction law perspective” and wanted the parties to brief the “effect of
verbal directions in the field without written change orders—even if there is
language in the contract stating that all change orders must be in writing.”
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The arbitrator gave the parties another opportunity to brief this issue. (See
Arbitrator’s E-mail to Parties, 7/23/19, at 1; R.R. at 72a). Even if the
arbitrator misapplied Pennsylvania law, that is not grounds for upsetting the
arbitration award. See Civan, supra; F.J. Busse Co., supra.
Additionally, Appellant’s claims of the arbitrator’s alleged violations of
the AAA’s Construction Industry Arbitration Rules do not rise to the level of
those procedural irregularities where modification of the arbitration award was
required. See D’Amelia, supra. The record simply does not show that
Appellant was deprived of a hearing or that fraud, misconduct, corruption, bad
faith, ignorance of the law, or indifference to the justice of the result occurred
such that the arbitration award should be vacated. See Civan, supra; F.J.
Busse Co., supra. In light of our very narrow scope of review which favors
the public policy of finality in arbitration proceedings, we cannot say the trial
court abused its discretion in denying Appellant’s petition to vacate and
granting Appellee’s petition to confirm the arbitration award.10 See Gargano,
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10 Appellee requests that we award damages, attorney’s fees, and interest
under Pa.R.A.P. 2744 (explaining that appellate court may award counsel fees
and other damages when it determines that appeal is frivolous or taken solely
for delay or that conduct of participant against whom costs are to be imposed
is dilatory, obdurate or vexatious). Appellee’s request is based, at least in
part, on its belief that Appellant’s current petition to vacate was untimely filed
in Philadelphia County. Nevertheless, we have already decided that the timely
Montgomery County filing should have been transferred to Philadelphia
County. Further, while Appellant’s issues on appeal do not merit any relief,
we decline to hold that this appeal is frivolous or was taken solely for the
purpose of delay. See id.; U.S. Claims, supra at 878 (stating: “In
(Footnote Continued Next Page)
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J-S36016-21
supra; Civan, supra. Accordingly, we affirm.
Orders affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 2/23/2022
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determining the propriety of such an award, we are ever guided by the
principle that an appeal is not frivolous simply because it lacks merit; rather,
it must be found that the appeal has no basis in law or fact”).
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