Anthony v. Kaplan, 95-1270

• Decision Date: 01 April 1996
• Docket Number: No. 95-1270,95-1270
• Citation: 324 Ark. 52,918 S.W.2d 174
• Court: Arkansas Supreme Court
• Parties: Robert ANTHONY, Appellant, v. Phil KAPLAN and Kaplan, Brewer & Maxey, P.A., Appellees.

Page 174

918 S.W.2d 174

324 Ark. 52

Robert ANTHONY, Appellant, v. Phil KAPLAN and Kaplan, Brewer & Maxey, P.A., Appellees.

No. 95-1270.

Supreme Court of Arkansas.

April 1, 1996.

Kenneth R. Mourton, Rayburn W. Green, Fayetteville, James S. Cox, Memphis, TN, for appellant.

Bettina E. Brownstein, Little Rock, for appellee.

GLAZE, Justice.

This is a legal malpractice action based on a question involving vacation of an arbitration decision. Following his termination as a partner at KPMG Peat Marwick (KPMG), appellant Robert Anthony employed the legal services of appellees Phil Kaplan and his firm, Kaplan, Brewer & Maxey, P.A. On Anthony's behalf, Kaplan filed a complaint against KPMG in federal district court, alleging wrongful termination, and breach of contract based on a partnership agreement and a 1984 contract. The federal court dismissed Anthony's complaint and ordered the parties to arbitrate their dispute. Subsequently, Anthony and KPMG entered an arbitration agreement wherein they agreed the arbitration was to be conducted under the law of New York state, but that circuit court in Jackson County, Missouri was to have exclusive jurisdiction.

An arbitration hearing was held in December, 1992, at which time, the arbitration panel, by a two-to-one vote, held in KPMG's favor. Finding KPMG's partners had complied with the partnership agreement in terminating Anthony by a two-thirds vote, the majority panel held the partnership vote was the deciding factor and the 1984 contract was irrelevant to that issue.

Anthony filed a motion to vacate the panel's decision in the federal district court, and KPMG filed a motion to dismiss based on the forum selection clause in the arbitration agreement. On April 15, 1993, the district court dismissed Anthony's motion to vacate. The dismissal order was entered after the time had lapsed preventing Anthony from filing a motion to vacate the arbitration decision in the correct forum, the Missouri circuit court.

After obtaining his file from Kaplan, Anthony filed suit in the Pulaski County Circuit Court against Kaplan and his firm, alleging (1) legal malpractice and (2) breach of an oral contract for legal services. Thereafter, Kaplan filed a motion for summary judgment, asserting Anthony had failed to show proximate cause by establishing that a timely and properly filed motion to vacate the decision of the arbitration panel would have been granted by the Missouri court. Following a hearing, the Pulaski County Circuit Court granted Kaplan's summary judgment motion.

On appeal, Anthony argues two points which we do not reach. First, Anthony contends Kaplan's signature on the improperly filed motion is evidence of Kaplan's belief that the motion to vacate was tenable pursuant to Ark.R.Civ.P. 11. Therefore, Anthony argues Kaplan is estopped from now taking a position inconsistent to the one expressed earlier in his motion before the federal district court. This estoppel argument, however, was not raised below, and we will not consider it for the first time on appeal. See Collins v. Heitman, 225 Ark. 666, 284 S.W.2d 628 (1955). Second, Anthony failed to cite any supporting legal authority for his contention that the trial court improperly dismissed his claim for breach of the oral contract for legal services. As this court has held many times, we will not consider unsupported arguments that require further research. Fayetteville Sch. Dist. v. Ark. State Bd. of Ed., 313 Ark. 1, 852 S.W.2d 122 (1993).

For his third and final point on appeal, Anthony argues the trial court erred in granting summary judgment on his malpractice claim because issues of fact remained as to whether the decision of the arbitration panel would have been vacated, even if a timely appeal in the proper court had been filed. For support, Anthony cites the dissenting panel member's opinion as evidence that a properly filed motion to vacate the panel's decision would have been granted. ¹ Additionally, Anthony points out that, under his 1984 contract with KPMG, he had a monetary claim for compensation and retirement benefits, and claims his continuation with KPMG was to depend on maintaining a satisfactory level of performance. In sum, Anthony argues that, because his claims pursuant to the 1984 contract were totally ignored by the panel, the panel exceeded its powers in violation of the Uniform Arbitration Act.

An attorney is negligent if he or she fails to exercise reasonable diligence and skill on behalf of the client. In order to prevail under a claim of legal malpractice, a plaintiff must prove that the attorney's conduct fell below the generally accepted standard of practice and that this conduct proximately caused the plaintiff damages. Callahan v. Clark, 321 Ark. 376, 901 S.W.2d 842 (1995); Vanderford v. Penix, 39 F.3d 209 (8th Cir.1994); Ronald E. Mallen et al., Legal Malpractice § 8.12, at 601-608 (4th ed. 1996). To show damages and proximate cause, the plaintiff must show that but for the alleged negligence of the attorney, the result in the underlying action would have been different. Callahan; Vanderford.

While the question of proximate cause is usually a question for the jury, when the evidence is such that reasonable minds cannot differ, the issue becomes a question of law to be determined by the trial court. Skinner v. R.J. Griffin & Co., 313 Ark. 430 855 S.W.2d 913 (1993). To support his motion, Kaplan included a copy of the New York statute on vacating arbitration awards, the Uniform Arbitration Act on vacating awards, and case law from both New York and Missouri supporting his position. Once the moving party establishes a prima facie entitlement to summary judgment, the opposing party must meet proof with proof and demonstrate the existence of a material issue of fact. Renfro v. Adkins, 323 Ark. 288, 914 S.W.2d 306 (1996). Thus, for Anthony's complaint against Kaplan to have survived summary judgment, Anthony was required to show that, as a matter of law, the Missouri court would have granted his motion to vacate had the motion been properly filed.

Though the parties differ on whether New York or Missouri law applies, both New York and Missouri have adopted the Uniform Arbitration Act with only slight variances in the wording of the statutes. The New York statute in relevant part provides that an arbitration award shall be vacated if the rights of the complaining party were prejudiced inter alia where "an arbitrator ... exceeded his power[.]" N.Y.Civ.Prac.L. & R. 7511(b)(iii) (Consol.1980). The Missouri statute lists the grounds for vacating an arbitration award to include where "[t]he arbitrators exceeded their powers[.]" Mo.Ann.Stat. § 435.405.1(3) (Vernon 1992). ² Neither statute defines the arbitrator's power.

As a matter of public policy, arbitration is strongly favored, and is looked upon with approval by courts as a less expensive and more expeditious means of settling litigation and relieving docket congestion. Lancaster v. West, 319 Ark. 293, 891 S.W.2d 357 (1995); Estate of Sandefur v. Greenway, 898 S.W.2d 667 (Mo.App.W.D.1995). The party attempting to overturn an arbitration award, not the party attempting to sustain it, bears the burden of proof. Lancaster; R.L. Hulett & Co. v. Barth, 884 S.W.2d 309 (Mo.App.E.D.1994). The scope of arbitration is defined by the contract between the parties, and a party challenging the award is not entitled to a resolution on the merits. Estate of Sandefur, 898 S.W.2d 667. Further, it is not for the courts to determine if the arbitrators decided the dispute correctly, only that the arbitrators acted within their jurisdiction. Id. The failure of the arbitration panel to follow the law as a court of law or equity would have done, without specific agreement to such in the arbitration agreement, does not afford relief through the courts. Id.; Stifel, Nicolaus & Co. v. Francis, 872 S.W.2d 484 (Mo.App.W.D.1994); Maross Const. Inc. v. Central N.Y. Regional Transp. Authority, 66 N.Y.2d 341, 497 N.Y.S.2d 321, 488 N.E.2d 67 (1985).

On appeal, the...