Judd Const. Co. v. Evans Joint Venture

• Citation: 642 P.2d 922
• Decision Date: 29 March 1982
• Docket Number: No. 80SC239,80SC239
• Parties: JUDD CONSTRUCTION COMPANY, Petitioner, v. EVANS JOINT VENTURE, Respondent.
• Court: Supreme Court of Colorado

Page 922

642 P.2d 922

JUDD CONSTRUCTION COMPANY, Petitioner, v. EVANS JOINT VENTURE, Respondent.

No. 80SC239.

Supreme Court of Colorado, En Banc.

March 29, 1982.

Weller, Friedrich, Hickisch & Hazlitt, Mary A. Wells, Denver, for petitioner.

Cogswell & Wehrle, William E. Brayshaw, William C. Wildberger, Denver, for respondent.

ROVIRA, Justice.

We granted certiorari to review the Colorado Court of Appeals decision that the trial court erred in entering a final judgment on an arbitrator's award prior to the determination of the issues raised by cross claims. Judd Constr. Co. v. Evans Joint Venture, Colo.App., 619 P.2d 775 (1980). We reverse.

I.

Judd Construction Company (Judd) contracted with Evans Joint Venture (Evans), the owner, to act as a general contractor on a construction project. Ace Tile Company (Ace), a subcontractor, filed suit against Judd and Evans, claiming that it had not been paid for work done on the project (Civil Action 80448). Both Judd and Evans answered Ace's complaint and, in addition, Evans asserted counter-claims against Ace and cross claims against Judd. Judd moved to dismiss the cross claims of Evans based upon an arbitration agreement entered into between them, and this motion was taken under advisement by the trial court. ¹

Subsequently, Judd and Evans entered into an arbitration proceeding and, as a result, Judd received an award of $14,236.62. The Award of Arbitrator also provided that Judd would hold Evans harmless from all claims arising out of the litigation initiated by Ace. Judd does not dispute the hold harmless provision of the award.

Judd filed the Award of Arbitrator with the clerk of the district court pursuant to section 13-22-213, C.R.S. 1973 (1981 Supp.) and C.R.C.P. 109(e), and judgment was entered on the award (Civil Action 83154). Thereafter, Evans moved to vacate the judgment and to consolidate Civil Action 83154 with the still pending litigation initiated by Ace. These motions were granted.

In the consolidated action, Judd sought and obtained a confirmation of the Award of Arbitrator, and judgment was again entered on the award on June 21, 1979. ² Evans argued that the entry of final judgment should be delayed until all claims in the Ace litigation were resolved and that the Award of Arbitrator should be corrected to clarify the "hold harmless" provision. The trial court rejected Evans' position, and Evans filed its Notice of Appeal. Subsequent to the filing of the appeal, the parties and Ace stipulated to the dismissal with prejudice of the claims of Ace against Judd and Evans. This stipulation did not affect the cross claims filed by Evans against Judd.

The court of appeals reversed, holding that once the proceeding for confirmation and entry of judgment on the arbitrator's award (Civil Action No. 83154) was consolidated with the Ace litigation (Civil Action No. 80448), all claims, including cross claims of Evans against Judd, had to be resolved before entry of a final judgment and the Uniform Arbitration Act of 1975 (Arbitration Act), sections 13-22-201 to -223, C.R.S. 1973 (1981 Supp.), did not provide otherwise. The court of appeals reasoned that, absent an appropriate C.R.C.P. 54(b) order, a final judgment could not be entered when fewer than all claims have been resolved; and since resolution of the cross claims could result in an offset against the arbitrator's award, permitting execution on the judgment would encourage multiplicity of litigation in derogation of the purpose of the rules.

II.

The issue to be resolved in this case is whether, in view of the provisions of the Arbitration Act, a judgment may be entered confirming an Award of Arbitrator when other claims remain to be resolved in a consolidated action.

Judd argues that the Arbitration Act requires entry of judgment on the Award of Arbitrator unless proper grounds for modification, correction, or vacation of award are presented; the existence of the cross claim of Evans against Judd and the consolidation of the cases does not change or limit the mandate of the Arbitration Act; and C.R.C.P. 54(b) is not relevant because the Arbitration Act authorizes a summary procedure to effectuate the public policy in favor of arbitration. We agree.

Arbitration provides an efficient, convenient alternative to litigation, and it has long been the policy of this state to foster and encourage the use of arbitration as a method of dispute resolution. See Sandefer v. District Court, Colo., 635 P.2d 547 (1981); Columbine Valley Constr. Co. v. Board of Directors, Colo., 626 P.2d 686 (1981); Ezell v. Rocky Mountain Bean & Elevator Co., 76 Colo. 409, 232 P. 680 (1925). See also Colo. Const. Art. XVIII, Sec. 3 ("It shall be the duty of the general assembly to pass such laws as may be necessary and proper to decide differences by arbitrators ....").

The Arbitration Act was adopted in order to establish a statutorily based scheme of arbitration. The stated purpose of the Act is to "validate voluntary written arbitration agreements, make the arbitration process effective, provide necessary safeguards, and provide an efficient procedure when judicial assistance is necessary." Section 13-22-202, C.R.S. 1973 (1981 Supp.).

Under the Arbitration Act, provision is made for judicial confirmation of an arbitrator's award. The Arbitration Act further establishes the grounds upon which a court may vacate, modify, or correct an arbitration award. Finally, provision is made for the entry of judgment upon an award and the appeal therefrom.

A review of these provisions discloses that the role of a court in considering an arbitrator's award is strictly limited. This is in conformity with the purpose of the Arbitration Act and the significance of an arbitration award. The procedure of the Arbitration Act is designed to achieve enforcement without delay, or undue expense. Further, under both the Act and the common law, an arbitration award is tantamount to a judgment and is entitled to be given such status by a court sitting in review. See Columbine Valley Constr. Co. v. Board of Directors, supra.

Section 213 provides that upon "application of a party, the court shall confirm an award, unless within the time limits imposed in this (Act) grounds are urged for vacating or modifying or correcting the award...." Grounds for vacating, modifying or correcting an arbitration award are set out in sections 214 and 215 of the Arbitration Act. An award may be vacated where:

"(I) The award was procured by corruption, fraud, or other undue means;

(II) There was evident partiality by an arbitrator appointed as a neutral or corruption in any of the arbitrators or misconduct prejudicing the rights of any party;

(III) The arbitrators exceeded their powers;

(IV) The arbitrators refused to postpone the hearing upon sufficient cause being shown therefor or refused to hear evidence material to the controversy or otherwise so conducted the hearing, contrary to the provisions of section 13-22-207, as to prejudice substantially the rights of a party; or

(V) There was no arbitration agreement and the issue was not adversely determined in proceedings under section 13-22-204 and the party did not participate in the arbitration hearing without raising the objection."

Section 13-22-214, C.R.S. 1973 (1981 Supp.). An award is subject to correction or modification where:

"(a) There was an evident miscalculation of figures or an evident mistake in the description of any person, thing, or property referred to in the award;

(b) The arbitrators awarded upon a matter not submitted to them and the award may be corrected without affecting the merits of the decision upon the issues submitted; or

(c) The award is imperfect in a matter of form, not affecting the merits of the controversy."

Section 13-22-215, C.R.S. 1973 (1981 Supp.). Finally, section 216 of the Arbitration Act provides that upon the "granting of an order confirming, modifying, or correcting an award, judgment or...