LETKE SEC., CONTR., INC. v. US SURETY CO.
Decision Date | 29 March 2010 |
Citation | 191 Md. App. 462,991 A.2d 1306 |
Parties | LETKE SECURITY CONTRACTORS, INC. v. UNITED STATES SURETY COMPANY. |
Court | Court of Special Appeals of Maryland |
Donald D. Hecht, Baltimore, for appellant.
Lucas F. Webster (William M. Huddles, Huddles, Jones, Sorteberg & Dachille, PC, on the brief), Columbia, for appellee.
Panel: SALMON,* ZARNOCH, IRMA S. RAKER (Retired, specially assigned), JJ.
IRMA S. RAKER, J., Retired, specially assigned.
This dispute arises out of a voluntary, non-judicial, binding arbitration held in Maryland pursuant to the parties' agreement to arbitrate. The arbitrator issued an award in favor of appellee, United States Surety Company (hereinafter USSC). Appellant Letke Security Contractors (hereinafter Letke), a construction subcontractor, appeals from the order of the Circuit Court for Baltimore City confirming the arbitration award in favor of appellee, USSC. Appellant asks this Court to reverse the order of the circuit court denying Letke's petition to vacate the arbitration award pursuant to the provisions of the Maryland Uniform Arbitration Act (hereinafter MUAA), Maryland Code (1974, 2006 Repl. Vol., 2009 Cum. Supp.), Courts and Judicial Proceedings Article, §§ 3-201 et seq.1 We shall affirm the judgment of the Circuit Court for Baltimore City denying appellant's petition to vacate the arbitration award and affirming the award.
This case arises from a public construction project on the City of Baltimore's Black River Wastewater Treatment Plant. Letke acted as a subcontractor for the principal contractor, Shaney Construction Company (hereinafter Shaney). Under Maryland's "Little Miller Act," Maryland Code (1985, 2006 Repl. Vol., 2008 Cum. Supp.), State Finance and Procurement Article, §§ 17-101 et seq., Shaney was required to secure the payment of its obligations to its subcontractor by obtaining a performance and payment bond. Shaney contracted with USSC for those bonds.
For reasons not germane to this litigation, the relationship between appellant and Shaney Construction Company came to an early end. The parties agreed to arbitrate the matter before Robert M. Wright, Esq. On August 6, 2007, the arbitrator conducted a conference call to set administrative deadlines and the date of the arbitration hearing. Both parties were represented by counsel, and Letke, through counsel, agreed to the dates of January 3 and 4, 2008, for the hearing.
On October 31, 2007, appellant's counsel withdrew from the case. Letke's counsel requested Shaney to consent to a postponement of the hearing if new counsel needed it, and Shaney agreed. No new counsel entered an appearance in the case. There was no further communication on this topic until December 21, 2007, thirteen days before the scheduled merits hearing. Shaney wrote to the arbitrator to determine whether Letke would be retaining counsel; whether Letke would be permitted to proceed pro se; whether Letke would meet the December 28, 2007, deadline for the exchange of witness lists and exhibits; and whether the hearing would proceed as scheduled on January 3 and 4, 2008. At that time, Shaney was still willing to agree to a postponement, and stated in its letter as follows:
The letter further read in relevant part as follows:
In response to appellee's letter, the arbitrator contacted appellant, and on December 21, Kimberly Letke responded with a letter on behalf of her company, which was faxed to both appellee and the arbitrator. The letter stated in relevant part:
On the same day, the arbitrator responded to Ms. Letke's letter, confirming that Ms. Letke would be permitted to represent her company without counsel, at her election.
On December 28, Ms. Letke sent a letter to the arbitrator requesting a postponement of the January 3, hearing, arguing that she did not receive appellee's exhibits until 6:30 p.m. on December 28, after the agreed upon deadline of 5:00 p.m. Ms. Letke further argued that appellant's new attorney would not have time to review the case. The attorney had not entered an appearance on behalf of appellant, and this December 28 communication was the first indication of any plan for him to represent appellant. Appellee opposed Ms. Letke's request, arguing that it had incurred expenses in preparation for the early January hearing. The arbitrator denied the postponement request, ruling as follows:
The hearings occurred according to the original schedule, on January 3 and 4, 2008, with all parties present and participating. Ms. Letke appeared at the hearing, made arguments, provided testimony, introduced documents, and cross-examined witnesses.
On January 23, 2008, the arbitrator issued an award in favor of USSC, mailing it to the parties by regular mail. Appellant sent an undated letter to the arbitrator, seeking "reconsideration" of the award.2 The letter was postmarked February 19 and received by the arbitrator on February 21, 2008.
On May 16, 2008, appellee filed a motion in the Circuit Court for Baltimore City to confirm the arbitration award and for entry of judgment in its favor. Appellant responded, stating that appellee's motion to confirm the award was premature because appellant had requested the arbitrator "to modify or correct his decision." On July 14, 2008, the circuit court denied appellee's motion on the grounds that "plaintiff asserts that it filed a timely request for modification of the arbitration award and, there being no final determination from the arbiter at this time, the Court may not act on defendant's motion to confirm the award or enter judgment." On the same day, July 14, the arbitrator denied appellant's motion for modification. The Order, signed by Robert M. Wright, stated as follows:
Appellant filed a motion in the circuit court, requesting that the court vacate the arbitration award. It argued that it had been prejudiced by the arbitrator's refusal to postpone the hearing.
Appellee filed an opposition to the motion to vacate, and asked the court to confirm the Award and enter final judgment in favor of USSC. Appellee presented two arguments to the circuit court—the first, that the motion to vacate the award was untimely filed,3 and the second, that the arbitrator did not abuse his discretion in denying the request to postpone the hearing.
The circuit court ruled that the motion to vacate was timely filed but denied the motion on the grounds that the arbitrator did not abuse his discretion in denying the postponement and requiring the parties to go forward with the hearing that was previously scheduled and agreed upon. The court issued an order denying the motion to vacate, confirming the January 23, 2008 arbitration award, and entering judgment in favor of USSC.
Appellant noted a timely appeal to this Court, and presents two issues: first, whether the arbitrator's refusal to postpone the hearing was arbitrary and an abuse of discretion, and second, whether appellant was substantially prejudiced and denied fundamental fairness when it was required to proceed at the arbitration hearing without counsel.
Before this Court, appellant argues that the arbitrator abused his discretion in denying its motion to postpone the participatory hearing. It maintains that it was prejudiced by...
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