Allstate Ins. Co. v. Cook, 2
| Decision Date | 04 March 1974 |
| Docket Number | No. 2,CA-CIV,2 |
| Citation | 519 P.2d 66,21 Ariz.App. 313 |
| Parties | ALLSTATE INSURANCE COMPANY, a corporation, Appellant, v. Richard M. COOK, Appellee. 1439. |
| Court | Arizona Court of Appeals |
The appellant-insurer (hereinafter referred to as Allstate) seeks reversal of a superior court judgment confirming an arbitration award in favor of appellee (hereinafter referred to as Cook).
Cook, while riding as a passenger in an automobile driven by Galvez and owned by Garcia, was injured when the car was involved in a collision with an uninsured vehicle driven by Soto. The Galvezdriven vehicle was insured by Farmers Insurance Exchange and Allstate had issued an automobile liability insurance policy, including uninsured motorist cover age, to Cook's father.
After the accident in question, Farmers paid Cook $10,000 and Cook executed a release of Farmers. Cook then made demand upon Allstate to pay the limit of its uninsured motorist coverage to him. On December 22, 1969, Cook filed a demand for arbitration pursuant to the following provision in the Allstate policy:
February 8, 1971 was set as the date for the arbitration hearing. On January 26, 1971, Allstate filed a lawsuit against Cook alleging in part that since Cook had been paid $10,000 under the uninsured motorist coverage of the Farmer's policy, there was no coverage under the Allstate policy and requested a declaration as to its obligation to Cook arising out of its insurance policy. Allstate also filed a petition to stay the arbitration proceeding. Cook responded with a motion to dismiss and to compel arbitration. The arbitration hearing was held as scheduled on February 8, 1971, and thereafter on February 23, 1971 the court ruled as follows on the motion to dismiss the declaratory judgment action:
'It is hereby ordered that the Motion is granted, and the Complaint is ordered dismissed without prejudice to the rights of the Plts. to have the Superior Court hear and determine any matters properly presented to it with reference to any award resulting from the arbitration proceeding.
The portion of the Motion requesting the Court to compel arbitration is moot since the Court was formed by both counsel that the arbitration has actually been held.'
At the commencement of the arbitration hearing, counsel for Allstate argued that the arbitrator was without jurisdiction to determine Allstate's liability under the insurance policy because Allstate denied the existence of coverage under such policy. He contended that the arbitration provision of the insurance policy did not authorize submission of coverage issues to arbitration. The partial transcript of the hearing reflects that the arbitrator intended to decide whether or not there was coverage:
'Well, I am going to take into account the fact that Cook has received $10,000 already and what I mean by that is, for example, if I find that the person is entitled to $15,000, he will get $5,000.'
On March 4, 1971 the arbitrator made his award directing Allstate to pay Cook the sum of $10,000, expressly finding that Cook was damaged in excess of $20,000. Allstate did not pay the sum awarded whereupon Cook applied for confirmation of the arbitration award. Allstate opposed the application alleging that the arbitrator had exceeded his power and acted beyond his jurisdiction. 1 The matter was duly heard and the judgment confirming the arbitrator's award resulted. This appeal followed. 2
The pivotal question is whether or not the arbitrator had authority to decide, as he apparently decided,...
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