Loretta Realty Corp. v. Massachusetts Bonding & Ins. Co., 2334
| Decision Date | 17 June 1955 |
| Docket Number | No. 2334,2334 |
| Citation | 114 A.2d 846,83 R.I. 221 |
| Parties | LORETTA REALTY CORPORATION et al. v. MASSACHUSETTS BONDING AND INSURANCE COMPANY et al. Equity |
| Court | Rhode Island Supreme Court |
Aisenberg & Joslin, Alfred H. Joslin, Providence, for plaintiffs.
Boss & Conlan, Francis W. Conlan, Carroll & Dwyer, Providence, for defendant Massachusetts Bonding & Ins. Co.
This is an action of debt on bond. After the cause was at issue in the superior court it was submitted to an arbitrator in accordance with general laws 1938, chapter 475. It is here on the plaintiffs' appeal from an order of the superior court confirming the arbitrator's award.
The plaintiffs are Loretta Realty Corporation and Christopher L. Migliaccio. The defendants are the Massachusetts Bonding and Insurance Company, hereinafter called the surety, and the Industrial Sales & Construction Company, Inc. Certain other parties were allowed to intervene but it is not necessary to describe them here since only the rights of plaintiffs and the surety are involved in the instant appeal.
The controversy between them arose out of the alleged breach by the surety of a bond given by the construction company to secure the faithful performance of a building contract which it had entered into with the plaintiffs. Among other things the arbitrator found that the construction company 'committed a very substantial breach of its contract in that it abandoned the work before completion and prior to abandoning the work failed in several respects to comply with the contract.' He also found that plaintiffs had made a payment of $7,500 to the construction company after such breach and did not notify the surety thereof before making said payment.
On the basis of those findings the arbitrator held that the construction company was liable to plaintiffs in the sum of $5,155.65 plus interest and that the surety was released. The award states that plaintiffs' payment of $7,500 to the construction company when it 'was in default, without notice of the situation to Surety and without Surety's having been afforded an opportunity to object to the payment, released the Surety to the extent of the amount paid.' The plaintiffs claim that this is a clear mistake of law in the circumstances here. In the case of such a mistake they contend that under the provisions of § 10 of chapter 475 the superior court must vacate the award.
Hence upon the return of the award to the superior court the surety duly filed a motion that the award be confirmed. Thereupon plaintiffs filed a motion in writing that it 'be modified and corrected, or in the alternative that it be vacated.' The superior court denied plaintiffs' motion and entered an order confirming the award. In their reasons of appeal from such order plaintiffs allege that it is erroneous, because the arbitrator was 'guilty of misbehavior as a result of which misbehavior the rights of the plaintiffs were substantially prejudiced,' and also that he 'so exceeded his powers and so improperly executed them that a mutual, final and definite award upon the subject matter was not made.'
The plaintiffs expressly concede in their brief that the arbitration was under chapter 475; that the arbitrator's findings of fact are conclusive; that all reasonable presumptions are to be made in favor of his award; and that the only grounds upon which this award may be set aside are found in paragraphs (c) and (d) of said chapter. The sole question raised on this appeal, therefore, appears to be this: Is the alleged mistake of law equivalent to 'any other misbehavior' as that term is used in paragraph (c) or to the arbitrator exceeding his powers or so imperfectly executing them as stated in paragraph (d)?
Those paragraphs are set out with two others in § 10 as follows:
'(a) Where the award was procured by corruption, fraud or undue means.
'(b) Where there was evident partiality or corruption on the part of the arbitrators, or either of them.
'(c) Where the arbitrators were guilty of misconduct in refusing to postpone the hearing, upon sufficient cause shown, or in hearing legally immaterial evidence, or refusing to hear evidence pertinent and material to the controversy, or of any other misbehavior by which the rights of any party have been substantially prejudiced.
'(d) Where the arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final and definite award upon the subject matter submitted was not made.'
The plaintiffs contend that a mistake of law appearing on the face of the award should be regarded under paragraph (c) as 'other misbehavior' by which their rights 'have been substantially prejudiced', and under paragraph (d) as a case of the arbitrator exceeding his powers or imperfectly executing them. In reply the surety argues that the omission of 'mistake of law' from § 10 percludes such construction of paragraphs (c) and (d). The finality of an award under the statute, it claims, is explicit and can be vacated only for a ground specifically enumerated in § 10. Those grounds, it further argues, are tied to misconduct or misbehavior in its true sense and mistake of law cannot be regarded as such within the reasonable intendment of paragraph (c) in the context of § 10 as a whole. Finally the surety claims that plaintiffs' construction of paragraph (d) is without any foundation whatever and misses completely the real purport of that provision.
After carefully considering the above contentions and the authorities which the parties have cited in support of their respective views, we are of the opinion that the legislature did not intend to make such mistake of law the equivalent of misconduct or misbehavior and therefore a ground for vacating an award under the statute. Prior to its enactment in 1929 it was settled in this state that an award in an arbitration at common law could be vacated for mistake of law appearing on...
To continue reading
Request your trial
-
M&L Power Services v. American Networks Intern.
...face of the award is not grounds for vacating an arbitration award for other misbehavior. See Loretta Realty Corp. v. Massachusetts Bonding & Ins. Co., 83 R.I. 221, 114 A.2d 846, 849 (1955). Nor is a mistake of law grounds for finding a manifest disregard of the law. See Westminster Constr.......
-
Belanger v. Matteson
...Such an omission is clear evidence that an award cannot be challenged on such a ground. Loretta Realty Corp. v. Massachusetts Bonding & Ins. Co., 83 R.I. 221, 226, 114 A.2d 846, 849 (1955). We see no reason for faulting the arbitrators for the manner in which they decided to evaluate the ev......
-
Rathbun v. Autozone, Inc.
...508 A.2d 678 (R.I.1986); Langdeau v. Narragansett Ins. Co., 94 R.I. 128, 179 A.2d 110 (R.I. 1962); Loretta Realty Corp. v. Massachusetts Bonding Ins. Co., 83 R.I. 221, 114 A.2d 846 (1955). To hold otherwise, would allow a plaintiff that missed the FEPA statutory deadline, or as in this case......
-
Bradford Dyeing Assoc. v. J. Stog Tech GmbH
...92 (R.I.1991). Error of law on the part of the arbitrator affords no ground for relief. Loretta Realty Corp. v. Massachusetts Bonding and Insurance Co., 83 R.I. 221, 225, 114 A.2d 846, 848 (1955).8 In Westminster Construction Corp. v. PPG Industries, Inc., 119 R.I. 205, 210, 376 A.2d 708, 7......