Hilton Head Resort Four Seasons Center Horizontal Property Regime Council of Co-Owners, Inc. v. Resort Inv. Corp.

• Decision Date: 17 March 1993
• Docket Number: CO-OWNER,No. 1991,INC,1991
• Citation: 429 S.E.2d 459,311 S.C. 394
• Parties: HILTON HEAD RESORT FOUR SEASONS CENTER HORIZONTAL PROPERTY REGIME COUNCIL OF, Plaintiff, v. RESORT INVESTMENT CORPORATION, a/k/a Resort Development Corporation; The Hartford Accident and Indemnity Company, L.P. Cox Company of Concord, Inc., L.P. Cox Company, Inc., K.W. Arthur & Son, Inc., Stevens & Wilkinson, Inc., Masonite Corporation, Buford Goff and Associates, King/Guinn and Associates, P.A., Coker Builders, Inc., St. Paul Fire and Marine Insurance Company, Covil Corporation, Johnny T. Johnson and Associates, Inc., now known as Johnson, Knowles, Burgin & Bouknight, Inc., Joseph Rogers, Architectural Design Associates, P.A., and John Watkins, Defendants, of whom Resort Investment Corporation, a/k/a Resort Development Corporation, is Defendant/Respondent, and Coker Builders, Inc., is Third Party Plaintiff/Appellant, and ST. PAUL FIRE AND MARINE INSURANCE COMPANY is Appellant, v. DYNAMIT NOBEL OF AMERICA, INC., Crawford Sprinkler Company of South Carolina, Inc., and J.L. Summerlin, Third Party Defendants. . Heard
• Court: South Carolina Court of Appeals

Page 459

429 S.E.2d 459

311 S.C. 394

HILTON HEAD RESORT FOUR SEASONS CENTER HORIZONTAL PROPERTY

REGIME COUNCIL OF CO-OWNERS, INC., Plaintiff, v. RESORT INVESTMENT CORPORATION, a/k/a Resort Development

Corporation; The Hartford Accident and Indemnity Company,

L.P. Cox Company of Concord, Inc., L.P. Cox Company, Inc.,

K.W. Arthur & Son, Inc., Stevens & Wilkinson, Inc.,

Masonite Corporation, Buford Goff and Associates, King/Guinn

and Associates, P.A., Coker Builders, Inc., St. Paul Fire

and Marine Insurance Company, Covil Corporation, Johnny T.

Johnson and Associates, Inc., now known as Johnson, Knowles,

Burgin & Bouknight, Inc., Joseph Rogers, Architectural

Design Associates, P.A., and John Watkins, Defendants, of

whom Resort Investment Corporation, a/k/a Resort Development

Corporation, is Defendant/Respondent,

and

Coker Builders, Inc., is Third Party Plaintiff/Appellant, and ST. PAUL FIRE AND MARINE INSURANCE COMPANY is Appellant, v. DYNAMIT NOBEL OF AMERICA, INC., Crawford Sprinkler Company

of South Carolina, Inc., and J.L. Summerlin, Third

Party Defendants.

No. 1991.

Court of Appeals of South Carolina.

Heard March 17, 1993.

Decided April 12, 1993.

Rehearing Denied May 17, 1993.

Cause Dismissed Oct. 21, 1993.

Thomas C. Hildebrand, Jr., and Mark E. Rostick, of Sinkler & Boyd, Charleston, for appellant.

Thomas B. Jackson, III, of Tyler, Cassell & Jackson, Columbia, for defendant/respondent.

Russell S. Stemke, Charleston, for plaintiff.

GOOLSBY, Judge:

Coker Builders, Inc., and St. Paul Fire and Marine Insurance Company appeal an order that, among other things, denies their motion to stay a circuit court action pending arbitration and that stays arbitration of their dispute with Resort Investment Corporation, also known as Resort Development Corporation ("RDC"). The central issue concerns whether the circuit court should have stayed an arbitration proceeding that had been commenced. We affirm.

In 1987, Hilton Head Resort Four Seasons Center Horizontal Property Regime Council of Co-owners, Inc., brought an action in the circuit court against RDC and others. RDC filed a third-party complaint against Coker Builders seeking indemnification.

Coker Builders later moved to stay the action in the circuit court.

Meanwhile, on January 4, 1988, Coker Builders filed with the American Arbitration Association ("AAA") a demand for arbitration directed to RDC. RDC responded by notifying AAA on February 3, 1988 that it planned to contest in the action pending in the circuit court whether RDC's contract with Coker Builders contained an arbitration clause. On February 5, 1988, two days later, RDC returned to AAA a list for the selection of arbitrators mailed to RDC by AAA. RDC, however, expressly conditioned the return of the list on the circuit court requiring arbitration.

The circuit court subsequently required Coker Builders and RDC to arbitrate, but it did so in a verbal order. On March 10, 1988, however, AAA suspended "further administration" of the arbitration proceeding.

On March 2, 1989, the circuit court entered a consent order that dismissed the underlying action without prejudice. It dismissed the action without ever having set forth and entered in the record an order compelling arbitration. Coker Builders was among those consenting to the dismissal of the action. The arbitration that the circuit court had verbally ordered never went beyond the commencement stage.

In August 1989, Hilton Head Resort re-filed its action. This time, RDC asserted a cross-claim against Coker Builders and others. It also asserted a third-party complaint against St. Paul, Coker Builders' surety on a performance bond. Coker Builders and St. Paul each alleged arbitration as an affirmative defense.

Coker Builders and St. Paul then filed, among other motions, a motion to stay the circuit court action until the arbitration proceeding that Coker Builders and St. Paul alleged was still pending had been concluded. In response, RDC made application pursuant to section 15-48-20(b) of the Code of Laws of South Carolina to stay the arbitration proceeding. ¹

After a hearing, the circuit court denied the motion by Coker Builders and St. Paul to stay the action and stayed the arbitration proceeding. In doing so, the circuit court held, citing Archer v. Long, 46 S.C. 292, 24 S.E. 83 (1896) and Bayne v. Bass, 302 S.C. 208, 394 S.E.2d 726 (Ct.App.1990), it was not bound by any verbal order it might have issued because it had not reduced any such order to writing. See Bayne, 302 S.C. at 210, 394 S.E.2d at 727 (" 'The [d]ecree must be in writing and until such time the [j]udge may modify, amend or rescind such an oral [o]rder.' ") (quoting Case v. Case, 243 S.C. 447, 451, 134 S.E.2d 394, 396 (1964).)

The circuit court also expressly found the contract between Coker Builders and RDC contained no arbitration provision and Coker Builders and RDC had not agreed to arbitrate any claims. Neither Coker Builders nor St. Paul appealed these findings.

I.

Coker Builders and St. Paul contend the circuit court erred in not granting their motion to stay the circuit court action on the ground that the court lacked subject matter jurisdiction because the claims against Coker Builders and St. Paul were then subject to a pending arbitration proceeding. See Fils et Cables D'Acier de Lens v. Midland Metals Corp., 584 F.Supp. 240, 244 (S.D.N.Y.1984) ("[A] court is precluded from considering any issue that the parties have voluntarily agreed to arbitrate."). This contention, however, assumes the parties had somehow agreed to arbitrate the dispute and it assumes the circuit court had properly ordered arbitration to commence.

As we noted above, the circuit court found Coker Builders and RDC's contract did not contain an agreement to arbitrate and Coker Builders and RDC did not otherwise agree to arbitration. Coker Builders and St. Paul have not questioned these findings. Where there has been no agreement to arbitrate, a party cannot be forced into compulsory arbitration. Episcopal Housing Corp. v. Federal Ins. Co., 269 S.C. 631, 239 S.E.2d 647 (1977).

Aside from any agreement to arbitrate, the circuit court, as we mentioned, did not set forth and did not enter in the record any order that compelled the parties to arbitrate their dispute before it dismissed the first action with the consent of all the parties. Without an order for arbitration set forth and entered in the record during the pendency of the action, the parties were not properly required to proceed with arbitration because a final order compelling arbitration never materialized. See Rule 58(a), SCRCP ("A judgment is effective only when so set forth and entered in the record."); First Union Nat'l. Bank v. Hitman, Inc., 306 S.C. 327, 329, 411 S.E.2d 681, 682 (Ct.App.1991), aff'd, --- S.C. ----, 418 S.E.2d 545 (1992) ("No order is final until it is written and entered."); Bayne, 302 S.C. at 210, 394 S.E.2d at 727 (an " '[oral] pronouncement is not a final ruling on the merits' " and it " '[is not] binding upon the parties until it has been reduced to writing, signed by the Judge and delivered for recordation.' ") (quoting Case, 243 S.C. at 451, 134 S.E.2d at 396); 46 Am.Jur.2d Judgments § 158 at 418 (1969) ("[I]t is sometimes specifically provided by statute or rule of court that a judgment is ineffectual until it is entered ... and that a judgment is not rendered before it is reduced to a journal entry, or before it is put in writing and entered as a judgment."); see also State ex rel. Preissler v. Dostert, 260 S.E.2d 279, 284 (W.Va.1979) ("It is well-settled that a court of record speaks only through its record and anything not appearing on the record does not exist in law.").

Coker Builders and St. Paul argue, however, RDC consented to arbitration by allowing arbitration to commence. They did not make this argument, however, to the circuit court and the circuit court did not rule upon it. We, therefore, cannot consider the issue. See Rental Uniform Serv. of Greenville, South Carolina, Inc. v. K & M Tool and Die, Inc., 292 S.C. 571, 357 S.E.2d 722 (Ct.App.1987) (the court of appeals will not address a question not raised in and passed on by the trial court).

Moreover, the commencement of an arbitration proceeding does not prevent the proceeding from being stayed. Section 15-48-20(b) expressly authorizes a court, on application, to stay "an arbitration proceeding commenced ... on a showing that there is no agreement to arbitrate." Here, RDC, acting pursuant to section 15-48-20(b) satisfied the circuit court that it had no agreement with Coker Builders and St. Paul to arbitrate. The circuit court clearly had jurisdiction, by virtue of section 15-48-20(b), to stay the "arbitration proceedings commenced" between Coker Builders and RDC.

II.

Coker Builders and St. Paul also contend RDC is estopped from pursuing any claims against them in the circuit court. Because the circuit court did not address the issue of estoppel in its order and because Coker Builders and St. Paul made no motion pursuant to Rule 59(e), SCRCP to require the circuit court to do so, we are precluded, even assuming Coker Builders and St. Paul raised the issue, from treating it on appeal. See Talley v. South Carolina Higher Educ. Tuition Grants Comm., 289 S.C. 483, 487, 347 S.E.2d 99, 101 (1986) (an issue raised but not ruled on by the trial court is not preserved and the complaining party must move before the trial court to amend the judgment pursuant to Rule 59(e), SCRCP); Rental Uniform Serv. of Greenville, South Carolina, Inc., 292 S.C. at 574, 357 S.E.2d at 724.

III.

Similarly, we do not address the issues of laches and waiver. The circuit court did not rule on these issues and Coker Builders and St. Paul made no Rule 59(e) motion to require the circuit court to address these issues. See Talley, 289 S.C. at 487, 347 S.E.2d at 101; Rental Uniform Serv. of Greenville, South...