Hartzler v. Bosarge
| Decision Date | 16 March 2021 |
| Docket Number | 2019-CA-01606-COA |
| Parties | Elton HARTZLER, Appellant v. Randy BOSARGE, Appellee |
| Court | Mississippi Court of Appeals |
ATTORNEY FOR APPELLANT: DOUGLAS LAMONT TYNES JR., Pascagoula
ATTORNEYS FOR APPELLEE: JAMES H. HEIDELBERG, Pascagoula, APRIL LEIGH McDONALD
EN BANC.
McCARTY, J., FOR THE COURT:
¶1. A homeowner hired a contractor to renovate a home in Ocean Springs. The homeowner later filed suit against the contractor, alleging the construction was faulty and that he needed to hire other workers to correct the issues. The parties agreed to submit the matter to binding arbitration in accord with their contract, and the homeowner was awarded damages and attorney's fees.
¶2. The homeowner sought to confirm the award in circuit court, and it was duly entered. Over a year after its confirmation, the contractor sought to have the court's judgment modified. He argued that the judgment was only against his company, and not him individually. Finding his arguments persuasive, the circuit court modified the judgment to release the contractor from the judgment.
¶3. The homeowner appealed. Finding that the circuit court exceeded its jurisdiction in modifying the arbitration award, we reverse and render.
BACKGROUND
¶4. The facts and procedural posture of this case are not in dispute. In 2007, Elton Hartzler entered into a Contractor Agreement with "Randy Bosarge of Superior Builders & Developers Inc." Bosarge is the president of Superior Builders. Hartzler hired him to work on a house in Ocean Springs.
¶5. About three years later, Hartzler filed a lawsuit against "Randy Bosarge d/b/a Superior Builders and Developers." In his complaint, he alleged Bosarge's substandard renovations not only breached "building codes," "industry standards," and "flood insurance requirements," but also caused him to incur additional costs to reverse the damages. The homeowner ultimately alleged the constructor was liable for breach of contract, breach of warranty, and negligent construction.
¶6. The defendant responded with a motion to send the case to arbitration. Using the singular, the relief was sought by "Defendant Randy Bosarge d/b/a Superior Builders and Developers." The motion requesting arbitration was signed by counsel under the party line "Randy Bosarge, Individually and d/b/a Superior Builders and Developers." The defendant argued that the contract between the two required arbitration if a dispute arose over the contract. As a result, the parties ultimately agreed to dismiss Hartzler's initial suit and arbitrate the case instead.
¶7. An arbitration hearing was held seven years later. On June 13, 2017, the arbitrator found in Hartzler's favor and ruled that he was entitled to recover an interim award of $67,009.12. On August 21, 2017, the arbitrator issued the homeowner a final arbitration award in the amount of $100, 513.68, which included attorney's fees, plus eight percent "due on any amount not paid within fourteen (14) days of this Final Award." Both the interim and the final arbitration awards listed the defendant as "Randy Bosarge d/b/a Superior Builders and Developers, Inc.," and referred to the defendant in the singular as "Bosarge."
¶8. Award in hand, Hartzler next sought to confirm it in circuit court. On April 13, 2018, the circuit court entered an order confirming the final arbitration award. On April 30, 2018, the circuit court entered a judgment consistent with the final arbitration award. The judgment held
¶9. A little less than a year later, on April 25, 2019, Hartzler filed a suggestion for a writ of garnishment on the judgment against "Randy Bosarge/Superior Builders and Developers," who was again referred to as the singular "Defendant." The circuit court issued a writ of garnishment that same day.
¶10. One full year after the judgment against him was entered, Bosarge filed a motion to quash the garnishment and modify the judgment. For the first time, Bosarge argued that the judgment was not entered against him personally, but only against "Randy Bosarge/Superior Builders and Developers." The better part of a decade after litigation began, and a year after judgment was entered in the case, Bosarge argued that he should not be bound by the arbitration award or the circuit court's confirmation of it.
¶11. Ultimately, after hearing arguments from the parties and reviewing the evidence, the circuit court agreed with Bosarge, and over a year after the original judgment confirming the arbitration award, removed Bosarge, in his individual capacity, from the judgment. The circuit court's order clarified that Hartzler "is entitled to Judgment from Superior Builders and Developers" but that Bosarge "is not and was not a party to the lawsuit or to the arbitration proceeding which led to the judgment, therefore the judgment does not apply to him."
¶12. Hartzler timely filed his notice of appeal from the trial court's modification of the judgment. He argues four points of error: (1) that the circuit court lacked jurisdiction to rule on Bosarge's motion to modify the judgment, (2) that the court likewise lacked jurisdiction to modify the arbitration award, (3) that Bosarge should not have been able to attack the judgment over a year later, and (4) that the circuit court erred in determining that Bosarge, individually, was not a party to the Contractor Agreement.
STANDARD OF REVIEW
¶13. The Mississippi Supreme Court has held that "the scope of judicial review of an arbitration award is quite narrow, and ‘every reasonable presumption will be indulged in favor of the validity of arbitration proceedings.’ " D. W. Caldwell Inc. v. W.G. Yates & Sons Constr. Co. , 242 So. 3d 92, 98 (¶13) (Miss. 2018) (quoting Wilson v. Greyhound Bus Lines Inc ., 830 So. 2d 1151, 1155 (¶9) (Miss. 2002) ).
DISCUSSION
¶14. Our review of this appeal is fully controlled by and fundamentally similar to the Supreme Court's decision in Caldwell v. Yates , supra. That case contains the required procedure we should use when analyzing whether an arbitration award is subject to modification.
¶15. In Caldwell , a subcontractor clashed with its general contractor over the work on a roof at Auburn University. Id . at 95-96 (¶¶4-5). The two companies went to arbitration, and the subcontractor prevailed. Id. at 96 (¶5). The general contractor asked the arbitrator to reconsider—a request that was "summarily dismissed by the arbitrator." Id . The subcontractor then asked the circuit court to confirm the award. Id .
¶16. During the proceedings to confirm the arbitration award, "the trial court allowed the parties to introduce evidence and witness testimony." Id . at 96-97 (¶¶7-8). "Ultimately, the trial court reviewed fourteen exhibits and the testimony of one witness in making its decision." Id . at 97 (¶6). The trial court found that the arbitration award had been wrongly calculated by the arbitrator, and "amended the award, reducing the total by $104,507." Id . But the Supreme Court reversed, rejecting both the process of confirmation used by the trial court and its findings of a miscalculation in the award. Id .
¶17. The Court first looked at the controlling law. The same code sections apply in this case as in Caldwell : construction contracts which "apply to any agreement for the planning, design, engineering, construction, erection, repair or alteration of any building, structure, fixture, road, highway, utility or any part thereof ...." Id . at 98 (¶12) (citing Miss. Code Ann. § 11-15-101(2) (Rev. 2012)). Guiding its analysis under that statute, the Court then called attention to the strict and binding nature of arbitration proceedings in general. Id . It explained that because the proceedings are so final and binding, trial courts must be careful to "review, confirm, or modify" all arbitration awards through an "extremely limited lens." Id . at 98 (¶13).
¶18. The Court went on to specify that the applicable statute which governs award modification is a part of that limited and narrow "lens." Id . In fact, that statute, along with its sister federal statute, are the only means by which an arbitration award can be modified. Id . The Caldwell Court specifically declared that "a circuit court has no authority to modify a construction-related arbitration award unless the exceptions outlined under" the statute apply. Id . (emphasis added).
¶19. Applying the rules above, the Court held the circuit court erred in finding a miscalculation existed. Id . at 100 (¶20). First, the Court reasoned that because a circuit court's review of arbitration awards is limited, "evident" mistakes "must be apparent from nothing more than the four corners of the award and the contents of the arbitration record." Id . (emphasis added). In other words, a circuit court must confine itself to the four corners of the award and the arbitration record, because "[l]ooking to evidence beyond ‘the face’ of the award or the arbitration record allows the parties an opportunity to retry the matter in front of a trial judge," which "diminish[es] the binding nature and finality of arbitration proceedings[.]" Id . at 100-01 (¶20).
¶20. The Supreme Court added that because parties are bound to the face of the award and the contents of the prior record, they should not be allowed "to present new evidence or witness testimony." Id . at 101 (¶20). This careful limitation follows the clear intent of the statute to favor the finality of arbitration: "By limiting the trial court's review to the arbitration award and the arbitration record alone, we ensure the integrity of arbitration proceedings...
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